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Mar
10
2014

TDA Daily Agricultural Market Summary 3/10/2014

Posted 4 years 79 days ago ago by Texas Department of Agriculture

Feeder cattle auctions steady to $10 higher; futures higher.
Fed cattle cash trade $2-$3 lower for the week; futures higher; Choice beef higher, Select lower.
Cotton cash prices unchanged futures higher.
Grains and soybeans mostly higher except corn lower.
Crude oil higher; natural gas lower.
Stock markets mostly higher.

Texas feeder cattle auctions reported prices mostly steady to $3 higher, with one location as much as $10 higher, compared to the previous sale. Market fundamentals remain very supportive with tight supplies expected for some time to come and strong competition for the limited available supply. Feeder cattle futures were higher in response to lower corn futures. The fed cattle cash trade was inactive on Friday, but has been $2-$3 lower for the week, in spite of stronger beef prices. Wholesale boxed beef values on Friday were higher for Choice offerings, but modestly lower for Select-grade cuts. Estimated daily cattle slaughter for the week totaled 548,000 head, considerably below both the previous week and a year ago. Fed cattle futures were higher.  

Cotton cash prices were unchanged on Friday while the expiring March futures contract was higher, but deferred contract months were lower. Traders were anticipating today's USDA World Agricultural Supply & Demand Estimates (WASDE), expecting it to show slightly higher exports and lower projected ending stocks compared to last month's report. Export sales and higher equity markets remain supportive, but the turmoil in Ukraine is seen as a negative for cotton and there are ongoing concerns about how China will handle its transition to new cotton support programs. 

Corn prices were 2-4 cents lower per bushel and grain sorghum was 3-6 cents lower per cwt, mostly due to speculative profit-taking on the underlying futures contract. (Average cash prices showed an increase because of another erratic shift in the price range reported by USDA Market News. Even so, they also quoted the trend lower.) Many traders still expect some increase in demand for U.S. corn due to the situation in Ukraine, but world supplies remain ample, which will likely keep a lid on potential price gains. 
Wheat prices were higher on Friday amid expectations for increased demand for U.S. wheat due to the Ukraine crisis and the potential for more evidence of winter freeze damage as the winter wheat crop breaks dormancy. Dry conditions across much of the U.S. wheat production area are also a concern.

Canadian grain shipments are expected to pick up after the government said it would fine railroads CN$100,000 per day if they don't ship at least 500,000 metric tons of grain per week. Canadian railroads had reduced grain shipments in order to haul more crude oil. The reduced grain shipments have been helping support prices for U.S. grains, especially wheat.

Stock markets closed mostly modestly higher on Friday, with only the Nasdaq posting a decline, mostly due to a bullish employment report. The Labor Department reported that payrolls expanded by 175,000 during February, much more than the expected increase of 152,000. However, the unemployment rate rose to 6.7% from 6.6% a month earlier and compared to expectations for a decline to 6.5%. Traders also remained concerned over the Ukraine crisis and the impact it could have on global trade.

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.