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Feb
28
2014

TDA Daily Market Summary 2/28/2014

Posted 4 years 89 days ago ago by Texas Department of Agriculture

  • Feeder cattle steady to $7 higher; futures lower
  • Fed cattle cash trade $5-$6 higher for the week; futures mostly lower; beef prices higher.
  • Cotton higher.
  • Grains and soybeans lower.
  • Crude oil and natural gas lower.
  • Stock markets higher.

 

Texas auctions reported feeder cattle prices steady to $7 higher as strong fed cattle and beef prices and higher feeder cattle futures a day earlier supported the market. One East Texas location noted prices to $3 lower on lighter-weight calves and several said their strongest prices were on heavier, stocker-type cattle. Feeder cattle futures were modestly lower in spite of lower corn futures. The fed cattle cash trade was quiet yesterday after jumping $5-$6 higher on Wednesday to a new record high $150 per cwt. Wholesale beef cutout values have advanced steadily all week and yesterday posted another solid $2.46 increase on Choice cuts. Estimated daily cattle slaughter continues to run higher than both last week and a year ago. Fed cattle futures were mostly lower, though the nearby Feb contract, with expires at the end of today’s session, was higher. Weekly beef export sales totaled 11,700 metric tons (MT), up 19 percent from the previous week and five percent from the prior four-week average. Export shipments were up three percent from a week earlier, but down one percent from the average. Japan, South Korea and Hong Kong were the leading destinations for U.S. beef.

It’s also worth noting that hog futures were sharply higher yesterday after Russia announced that it would once again allow pork imports from the U.S. from operations that don’t use growth promotant ractopamine. Pork prices have been increasing anyway due to disease issues and increased pork demand resulting from the run-up in beef prices.

Cotton cash prices and futures were higher yesterday in spite of weak export data as much of the increase was attributed to “bargain hunting” following recent price declines. Cotton export sales totaled only 27,100 bales, a marketing year low, down 62 percent from the previous week, 87 percent below the prior four-week average and about half the weekly average needed to meet USDA projections for the marketing year. On the plus side, sales for the marketing year have reached 90 percent of the USDA projection, ahead of last year’s pace. Export shipments were down 15 percent from a week earlier and 16 percent from the average. The top destinations were Turkey, China and Vietnam. Cumulative sales for the year are running behind last year’s pace.

Corn and grain sorghum prices were lower as recent price increases have pulled more corn out of elevators and farm storage bins. Mixed export data and weakness in soybeans also contributed to the decline. Corn export sales for the week totaled 840,800 MT, at the high end of pre-report expectations, up 22 percent from the previous week, but down 39 percent from the prior four-week average. The leading buyers were Japan, Columbia and Peru. Shipments were up 15 percent from a week earlier, but down one percent from the average.

Wheat prices were also lower due to mixed export data and spillover weakness from other crops. Global wheat supplies remain more than ample, so it does not take much bearish news to send the wheat prices lower. Wheat export sales of 365,100 MT were on the lower end of expectations, down 14 percent from the previous week and 39 percent from the prior four-week average. The Philippines, Thailand and Brazil were the top buyers. Export shipments were up 97 percent from a week earlier and 54 percent above the average.

Stock markets closed modestly higher yesterday, with the S&P 500 posting a new record high. Federal Reserve Chairwoman Janet Yellen told Congress that she intends to continues scaling back asset purchases “in measured steps” and that she thinks the weather is largely to blame for recent weak economic data. The Commerce Department reported that orders for durable goods fell less than expected during January. Orders excluding transportation posted their largest increase since last May. The Labor Department reported that new unemployment claims rose last week, compared to expectations for a 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.