Texas Daily Ag Markets 5/14/14

Posted 7 years 165 days ago ago by Texas Department of Agriculture

  • Feeder cattle steady to $6 higher; futures higher.
  • Fed cattle cash trade inactive; futures lower; beef prices higher.
  • Cotton lower.
  • Grains and soybeans mostly higher, except wheat unchanged.
  • Crude oil higher; natural gas lower.
  • Stock markets near unchanged.

Feeder cattle prices reported by Texas auctions were fully steady at several locations and $2-$6 higher at others. Supply/demand fundamentals remain very supportive and right now, there just does not seem to be a top to the market. Oklahoma City set record highs again this week, with 5-weight steers averaging more than $220 per cwt. Feeder cattle futures were higher. The fed cattle cash trade remained inactive yesterday, with feedlots asking $148, up $2 from last week’s average. No word yet on packer bids. Wholesale boxed beef prices were higher and estimated cattle slaughter so far this week continues to run below both last week and last year. Fed cattle futures were lower.

Cotton cash prices and futures were lower again yesterday as markets continue to adjust to last week’s USDA projections for higher carryover stocks. Traders remain very concerned about the dry conditions on the Texas High Plains, but planting made good progress last week, which likely put a little pressure on new crop futures contracts. One wire service report noted that changes in Chinese cotton policies continue to cast a shadow over the market. Their large reserves will likely limit Chinese cotton imports from the U.S. and other suppliers, but China is not expected to unleash large volumes of cotton on world markets. That should help maintain cotton prices, but any shift in policies could have a significant impact.

Wheat cash prices were unchanged, but futures were mostly lower as there was not much fresh news to move markets much in either direction. Major market factors remain supportive of wheat prices. Eastern sections of the Wheat Belt received rain, but major producing areas to the west remain very dry. Production in Texas is expected to be the lowest since 2006 and in Kansas, the lowest since 1996. There were also concerns about how the cold, wet weather in the Upper Midwest will impact spring wheat. Questions about the demand side of the equation continue to limit gains, but there was a little good news on that front yesterday in reports that Taiwan bought 110,500 metric tons of U.S. wheat.  

Corn and grain sorghum prices were higher after reports that South Korea bought 126,000 metric tons of old-crop corn from the U.S. Planting made good progress last week, but traders were concerned that cool temperatures and more rain this week could impede fieldwork in much of the Corn Belt.

Stock markets closed near unchanged, with the Dow slightly higher, S&P 500 unchanged, and NASDAQ slightly lower. The D-J Total Stock Market Index was also slightly lower. Stocks were higher early in the day on follow-through from Monday’s record highs, but then slipped lower due to a round of weak economic data. The Commerce Department reported that retail sales rose just 0.1% during April, much less than the 0.4% increase expected. Excluding autos, sales were unchanged, compared to expectations for a 0.6% increase. In a separate report, Commerce reported that import prices fell 0.4% during April for the first decline since late 2013, compared to expectations for a 0.3% increase. Export prices were 0.1% lower, the largest drop since June 2012 and much lower than expectations for a 0.3% increase.

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.