Texas Daily Ag Market Summary 7/2/14

Posted 10 years 149 days ago by

Feeder cattle mostly $1-$5 higher, few steady to lower; futures limit higher.
Fed cattle cash trade inactive; futures higher; beef prices record high.
Cotton lower.
Grains and soybeans lower.
Crude oil and natural gas lower.
Stock markets higher.

Feeder cattle prices reported by Texas auctions mostly $1-$5 higher per cwt, though one location quoted prices steady to $5 lower. As noted previously, record high prices also create volatility as prices bounce off those records and then, as has been the case lately, jump back to new highs. In addition, price trends this week and next will be based on a thinner market test as some auctions take their annual July 4 holiday break. Feeder cattle futures were sharply higher, with many contract months up their $3 daily trading limit. Lower corn prices and higher fed cattle continue to fuel the market. The fed cattle cash trade remained inactive yesterday with reports pegging initial asking prices at $156-$158, up $2-$4 from last week’s average. No word yet on packer bids. Wholesale boxed beef values were higher. Estimated cattle harvest so far this week has totaled 232,000 head, up 2K from last week, but 16K below a year ago. Fed cattle futures were higher.

Cotton cash prices and futures were lower yesterday as markets continue to adjust to the unexpectedly-high plantings reported on Monday by USDA. Rain on the Texas High Plains continues to push along the prospects for this year’s crop, but the lack of moisture reserves means that timely rains will remain critical to the crop’s development. A senior cotton analyst wrote yesterday, “Given how critical weather will continue to be and how much of an impact the West Texas crop has not only on the Southwest region but the U.S. as a whole, there are no guarantees with potential production. The rain to date is wonderful — no one doubts that, but subsoil moisture readings indicate the crop will require additional timely summer rain.”

Wheat prices were lower again yesterday as the market deals with increasing harvest-time supplies, already-ample world inventories and lackluster demand. Losses were limited somewhat by harvest delays, low yields and quality issues on the U.S. Southern Plains, including Texas.

Corn and grain sorghum prices were modestly lower yesterday as prospects for a large U.S. crop continue to put pressure on the market. However, there are also concerns about the severe storms and flooding in parts of the Corn Belt. There were reports of very heavy rain, tornadoes and hail in eastern Iowa and northern Illinois. Farther south, Arkansas officials said that 75,000 acres of cropland there are flooded with soybeans the hardest hit.

The DTN fertilizer price survey said, “Retail fertilizer prices continue to fluctuate, with some slightly lower and others a bit higher during the fourth week of June 2014. Price movement in either direction was not significant.”

Stock markets closed solidly higher yesterday with both the D-J Industrial Average and S&P 500 posting new record highs. Economic data were mixed. A leading manufacturing index came in lower than expected and the Commerce Department reported that construction spending rose only 0.1% during May, also less than expected. On the other hand, a “new orders index” was higher and a Chinese manufacturing index rose more than expected.

Disclaimer: The information compiled in the Daily Market Summary is obtained from a variety of sources, including those available on the Internet, that are believed to be reliable and accurate, but are in no way guaranteed. This information is intended to provide only a summary of market trends and a daily snapshot of agricultural markets and economic indicators. It should not be relied upon as a sole source of market information. Commentary is the author’s alone and does not in any way convey official TDA policies.