Texas Daily Ag Market Summary 12/5/14

Posted 9 years 358 days ago by

Feeder cattle steady to $15 higher; futures higher.
Fed cattle cash trade inactive; formula trades unchanged; futures lower; beef prices lower.
Cotton higher.
Corn, grain sorghum, soybeans higher; wheat, rice lower.
Crude oil and natural gas lower.
Stock markets modestly lower.

Texas feeder cattle auctions quoted prices steady to as much as $15 higher per cwt, with the most increase noted on lighter weight calves. Feeder cattle futures were higher in spite of higher corn and lower fed cattle futures. The fed cattle cash trade remained inactive in Texas with asking prices holding firm at $175 (up $2). However, a few head have traded in Nebraska and Iowa at $166, down $5 from last week’s average. Sliding beef prices have squeezed packer margins so they are looking for some relief in the form of lower fed cattle. Even with that kind of decline, prices will remain well above where they were a year ago and much above historical averages. Adding to the margin problems, beef prices were lower again yesterday. Estimated cattle harvest for the week totals 438,000 head, up 91K from last week’s holiday-shortened output, but 44K below a year ago. Fed cattle futures were lower. Weekly beef exports totaled 7,600 metric tons (MT), down 33% from the previous week and down 23% from the prior four-week average. Japan, Mexico and South Korea were the primary buyers. Export shipments of 11,300 MT were down 8% from the previous week and 13% lower than the average, with Japan, Hong Kong and South Korea the top destinations.

Cotton cash prices and futures were higher. Export sales came in lower than expected, but the volume was still somewhat supportive. Export commitments are running a little ahead of last year’s pace, but actual shipments are lagging. Cotton export sales for the week totaled 167,000 bales, down 45% from the previous week and 5% lower than the average. China, Indonesia and South Korea were the leading buyers. Shipments of 106,000 bales were down 1% from a week earlier, but up 32% from the average. China, Turkey and Mexico were the primary destinations. In other news, USDA’s ag attaché’ lowered forecast ending stocks for China citing lower production and higher consumption.

Corn and grain sorghum prices were higher after corn export sales “were a lot larger than expected, but it was yet another slow week on shipments.” There were also ongoing concerns about weather in South America. Corn export sales totaled 1,170,700 MT, up 24% from the previous week and 65% higher than the prior four-week average. Mexico, Japan and Peru were the top buyers. Shipments of 746,400 MT were up 21% from a week ago and 46% higher than the average. Mexico, Peru and Japan were the leading destinations.

Wheat prices were lower after export data came in on the low end of expectations. Wheat export sales totaling 319,200 MT were down 26% from the previous week and down 14% from the prior four-week average. Japan, Mexico and Panama were the primary buyers. Export shipments totaled 449,600 MT, down 13% from a week ago, but 54 percent higher than the average. The leading destinations were Japan, the Philippines and Peru. In addition, Canada’s latest wheat production forecast came in on the high end of expectations and Egypt bought more wheat from Romania and Ukraine rather than the U.S.

Stock markets closed modestly lower after the European Central Bank said yesterday that any new stimulus moves would have to wait until after the first of the year. Stock futures gained this morning after the Labor Department reported that the economy added 321,000 jobs during November, the strongest monthly gain in almost 3 years and much higher than the 230,000 increase 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.