Texas Daily Ag Market Summary 10/1/14

Posted 10 years 58 days ago by

Feeder cattle steady to $10 higher; futures higher.
Fed cattle cash trade inactive; formula trades higher; futures lower.
Choice beef prices slightly higher; Select-grade lower.
Cotton cash prices unchanged; futures lower.
Grains and soybeans lower.
Crude oil and natural gas lower.
Stock markets lower.

Texas feeder cattle auctions quoted prices steady to $10 higher per cwt, but feeder cattle futures were lower. Reports noted strong auction prices in spite of increasing supplies of short-weaned new crop calves that are always discounted because of their health issues and higher mortality. The fed cattle cash trade remained inactive yesterday with asking prices reported around $161-$162, compared with $159 two weeks ago. Formula trades were $3 higher. Wholesale boxed beef values were slightly higher for Choice offerings, but lower for Select-grade cuts. Both were pretty close to unchanged, which suggests beef prices may be stabilizing, at least temporarily. Estimated cattle harvest through Tuesday totaled 230,000 head, unchanged from last week, but 13K below a year ago. Fed cattle futures were lower in spite of bullish fundamentals and prospects that packers might have to pay more for cattle this week to make up for light purchases recently.

Cotton cash prices were unchanged, but futures were modestly lower. The China Cotton Association updated its production forecast to 30.8 million bales, down from its previous forecast, but still higher than USDA’s most recent projection. Harvest pressure is also starting to build as more new crop cotton hits the market. There were numerous reports yesterday that “The United States and Brazil are close to settling a decade-old trade dispute over cotton subsidies.” The new agreement was said to include a one-time, $300 million payment by the U.S. to the Brazilian Cotton Institute, which provides technical assistance to growers. Brazil would give up its right to implement retaliatory measures against U.S. trade and agree not to file new WTO complaints over the same issue.

Wheat prices followed corn lower after USDA wheat stocks estimates came in on the high side of pre-report expectations and higher than stocks at this time last year. Final 2014 production numbers were in line with expectations, but the two reports did nothing to ease the pressure from ample world wheat supplies.

Corn and grain sorghum prices were lower after USDA showed corn stocks up 51% from last year and also on the high end of expectations. On top of that, we’re still looking at a record large corn crop this year, with an advancing harvest putting more and more of that corn on the market.

Stock markets were lower after a Midwest business index, a consumer confidence index and a measure of new home prices all came in lower than expected. Ongoing unrest in the Middle East and pro-democracy demonstrations in Hong Kong also contributed to the decline.

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.