Texas Daily Ag Market Summary 12/4/14

Posted 10 years 25 days ago by

Feeder cattle mostly steady to $8 higher, few lower; futures lower.
Fed cattle cash trade inactive; formula trades higher; futures lower; beef prices mixed.
Cotton cash prices unchanged; futures higher.
Corn, grain sorghum, soybeans higher; wheat, rice lower.
Crude oil higher; natural gas lower.
Stock markets higher.

Texas feeder cattle auctions quoted prices mostly steady to $8 higher per cwt, though one reporting location was $3 lower on feeder heifers. Feeder cattle futures were lower in response to higher corn futures. The fed cattle cash trade remained inactive with asking prices still at $175 (up $2) and a few packer bids surfaced in Kansas and Nebraska at $166. Formula sales were up $1.60. Wholesale beef values were mixed, with Choice cuts modestly higher, but Select-grade offerings lower. Estimated cattle harvest so far this week totals 328,000 head, down 19K from last week and 32K below a year ago as packers try to stall the decline in beef prices. Fed cattle futures were lower as weak beef prices raised concerns about demand.

Cotton cash prices held unchanged, but futures were higher again yesterday after the International Cotton Advisory Committee said that Southern Hemisphere production will likely fall by 18% this season. Even with the decline, world carryout is expected to rise 9% from a year ago to equal 88% of projected mill use. That’s somewhat lower than last month’s USDA projection which represented 94% of estimated consumption.

Grain prices were mixed. Corn and grain sorghum prices ended the day modestly higher after trading lower for most of Wednesday. Mexico bought 190,000 metric tons of U.S. corn and traders expressed some concerns about South American weather. Higher crude oil and soybean prices also contributed to the increase. Wheat prices were lower on news that Egypt bypassed the U.S. and bought several loads of wheat from Romania and Ukraine. The stronger dollar and early-session weakness in row crops added to the negative mood.

This week’s U.S. Drought Monitor (click here for the Texas map or here for the U.S. map and summary) showed conditions in Texas near unchanged, with 66% of the state in some degree of drought or abnormal dryness. 22% of the state remains in severe, extreme or exceptional drought, the same as last week. Nationally, 48% of the country is experiencing abnormal dryness or some degree of drought, up one percentage point from a week ago.

Stock markets were higher with both the Dow Industrials and S&P 500 setting new records. Energy stocks led the way higher after crude oil futures posted a modest gain. Economic news was mixed. Payroll processor ADP said that private sector employment rose less than expected during November. Official monthly data from the Department of Labor are scheduled for release tomorrow. On a more bullish note, the Institute for Supply Management’s non-manufacturing index came in higher 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.