Texas Daily Ag Market Summary 7/7/14

Posted 10 years 144 days ago by

Feeder cattle auction trend n/a; direct trade $1-$4 higher; futures higher.
Fed cattle cash trade $4 higher; futures higher; beef prices record high.
Cotton lower.
Grains and soybeans mostly lower, except wheat higher.
Crude oil lower; natural gas higher.
Stock markets higher.

A feeder cattle auction price trend is not available as all reporting locations were closed for the July 4 holiday. Texas direct feeder cattle sales were $1-$4 higher per cwt last week. Feeder cattle futures were higher. The fed cattle cash trade was nearly $4 higher per cwt to a new record high $158 per cwt. Wholesale boxed beef values also set new record highs on Friday and fed cattle futures were higher. Prices across the beef complex continue to find strong support from the tight cattle supplies and continued strong demand throughout the sector. Estimated cattle harvest for the week totaled 464,000 head, up 1Kfrom the previous week and 90K higher than the same period last year, because of how the July 4 holiday fell.

Beef export sales for the week totaled 5,700 metric tons (MT), the lowest weekly total of the marketing year, down 67% from the previous week and 60% below the prior four-week average. The primary buyers were Japan, Chile and Taiwan. Export shipments of 14,100 MT were down 9% from the previous week and unchanged from the average. Japan, South Korea and Hong Kong were the top destinations.

Cotton cash prices and futures slipped lower on Thursday as markets continued to adjust for this year’s unexpectedly large plantings as reported by USDA. However, losses were limited by better than expected U.S. employment data and higher stock markets. Mixed export data did not help much. Cotton old-crop export sales for the 2013/14 marketing year totaled 34,900 bales, more than nine times higher than last week’s dismal marketing year low, but down 58% from the prior four week average. The leading buyers were China, Turkey and Taiwan. New crop sales for the 2014/15 marketing year were 59,700 bales, more than double the previous week, but down 37% from the average. The primary buyers were Turkey, China and Mexico. Export shipments totaling 170,600 bales were up 35% from a week earlier,14% higher than the average and higher than the weekly total needed to meet USDA projections for the marketing year. The top destinations were Turkey, China and Mexico.

Wheat prices were higher mostly due to speculative and fund buying as supply/demand fundamentals remain bearish. Wire service reports noted favorable harvest weather in Russia and Ukraine, but also said that there is considerable uncertainty about how much grain will be exported from the Black Sea region due to the ongoing political instability. Wheat export sales totaled 567,500 MT, up 58% from the previous week, with Brazil, Taiwan and Mexico the leading buyers. Shipments of 335,500 MT were down 43% from a week earlier. The leading destinations were the Philippines, Japan and Mexico.

Corn and grain sorghum prices were lower as prospects for a large U.S. harvest this fall continue to pressure the market. Export data were mixed, stronger sales, but weaker shipments. Corn export sales for the old-crop 2013/14 marketing year totaled 290,700 MT, up 14% from the previous week, but down 12% from the prior four-week average. The top buyers were Mexico, Japan and the Netherlands. New crop sales of 474,700 MT were double the previous week and four times higher than the average. The leading buyers were unknown destinations, Japan and Guatemala. Export shipments totaled 905,500 MT, down 16% from a week earlier and 18% below the average. Primary destinations were South Korea, Egypt and Mexico.

Stock markets closed higher, with the Dow closing above 17,000 points for the first time ever and the S&P 500 setting another record high (the 25^th so far this year). The rally came in response to a better than expected U.S. jobs report. The Labor Department reported that the economy added 288,000 jobs during June, well above the 215,000 increase expected. The unemployment rate fell more than expected, from 6.3% last month to 6.1% in June.

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.