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Nov
24
2014

Texas Daily Ag Market Summary 11/24/14

Posted 9 years 147 days ago by

  • Feeder cattle mostly steady to $5 higher, few $10 higher; futures higher.
  • Fed cattle cash trade $2.50 higher; formula trades higher; futures higher; beef prices lower.
  • Cotton higher.
  • Wheat, soybeans higher; corn, grain sorghum lower.
  • Crude oil higher; natural gas lower.
  • Stock markets higher.



Texas feeder cattle auctions quoted prices mostly steady to $5 higher, with a few $5-$10 higher on a portion of their offerings. Feeder cattle futures were higher. The fed cattle cash trade was $2.50 higher  in very light trade, averaging $172 on only 400 head of confirmed sales. Prices were up from a week ago in all major U.S. cattle feeding regions. Formula prices were $1 higher. Wholesale boxed beef values were lower, further squeezing packer margins. Estimated cattle harvest for the week totaled 567,000 head, up 7K from a week earlier, but down 54K from a year ago. Cumulative harvest is running 7.3% lower than a year ago. Fed cattle futures were higher due to the increase in the cash trade.

USDA NASS released its monthly Cattle on Feed report on Friday showing a total of 10.6 million head of cattle in feedlots on Nov. 1, up less than 1% from a year ago and higher than pre-report expectations. Placements on feed were down 1%, much less than expected, while marketings for harvest were down 8%, a little more than expected. Texas remains the top cattle feeding state in the nation with 2.55 million head of cattle in feedlots on Nov.1, up 1% from a year ago. The higher inventory and placements will likely be bearish for prices when markets open this morning.

Cotton prices were higher on Friday on news that Chinese production this year may be down by 16%, rather than the 7% decline projected all season. Even if that adjustment makes it into the official estimates, world cotton supplies remain very large in relation to usage, which will keep a lid on any potential gains.

Corn and grain sorghum prices were lower mostly due to speculative selling and profit-taking on the underlying futures contract. Ethanol margins were good and USDA reported another large corn sale to unknown destinations, but that was not enough to turn attention away from this year’s record-large crop and large global supplies.

Wheat prices were higher. There were concerns about potential freeze damage to wheat on the U.S. Plains and markets were “assessing damage to southern Brazil’s crop from recent excessive rainfall.”

Stock markets closed higher on Friday with both the D-J Industrial Average and S&P 500 posting new record highs. Investors were encouraged by news that “China’s central bank cut interest rates and the European Central Bank’s president reiterated that the institution was ready to expand its stimulus program.” However, gains were limited by the reality that the central bank moves might push stocks higher in the short term, but that the stimuli are caused by fundamental economic problems. Those problems still need to be resolved and the slow or nonexistent global economic growth needs to show some real improvement.


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.







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