Texas Daily Ag Market Summary 10/9/14

Posted 10 years 50 days ago by

Feeder cattle mostly steady to $10 higher, few lower; futures higher.
Fed cattle cash trade inactive; formula trades steady; futures higher; beef prices higher.
Cotton cash prices unchanged; futures modestly lower.
Corn and grain sorghum higher; wheat, rice, soybeans lower.
Crude oil and natural gas lower.
Stock markets higher.

Texas feeder cattle auctions quoted prices mostly steady to as much as $10 higher per cwt, though one location quoted light-weight steers lower. Feeder cattle futures were higher. The fed cattle cash trade remained inactive yesterday and formula sales were steady. Wholesale boxed beef values again posted solid gains and are now up about $8 per cwt for the week. Estimated week-to-date cattle harvest totals 342,000 head, down 2K from a week ago and 22K lower than last year. Fed cattle futures were higher. One observer speculated yesterday whether beef prices could continue to rise and whether live cattle futures could break through the $170 mark any time soon. He concluded that it was not likely in the near-term, but that ever-tighter cattle supplies could make it happen by the end of the year. Of course, it all depends on consumers’ willingness (and ability) to pay more for beef.

Cotton cash prices were unchanged yesterday, but futures were modestly lower as the market rally ran out of gas ahead of tomorrow’s USDA crop production and supply/demand reports. Pre-report expectations are coming in on both sides of USDA’s current production forecast. The report is based on crop conditions as of October 1 so it may not fully capture the impacts of September weather and, of course, will not factor-in more recent harvest delays and cool, wet conditions in much of the Cotton Belt.

Wheat prices were lower as weather conditions here in the U.S. remain favorable. Rains may have slowed down winter wheat seedings somewhat, but they are also restoring much-needed moisture that will benefit emergence and crop development. Reports noted some growing concerns about dry conditions in Australia.

Corn and grain sorghum prices were higher yesterday as traders watched the weather and waited for fresh news. Some parts of the Corn Belt have experienced harvest delays, but weather forecasts look a little more favorable. The trade still expects a record-large corn crop this year, with most figuring that USDA’s production forecast tomorrow will come in even higher than a month ago.

This week’s U.S. Drought Monitor (click here for the Texas map or here for the U.S. map and summary) showed continued improvement in conditions in Texas with 70% of the state now in some degree of drought or abnormal dryness, down one percentage point from a week ago. Less than 3% of the state is rated in the worst category, exceptional drought, and only 9% is in extreme drought. Nationally, the total acreage experiencing abnormal dryness or some degree of drought also declined by one point to 47% percent of the contiguous states. California, Oregon and Nevada remain in the worst condition.

Stock markets post solid gains yesterday, with most major indexes up one and a half to two percent, after minutes from the Federal Reserve’s last policy meeting indicated it intends to maintain its low interest rate policies “for a considerable time.”

The U.S. Surface Transportation Board yesterday announced new requirements for railroads to report weekly performance metrics. The reports are intended to provide more transparency for shippers and help explain (maybe eventually fix) the rail bottlenecks that are backing up grain shipments.

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.