The weekly Fed Cattle Exchange auction on Wednesday offered hope that cash fed cattle trade this week might be no worse than steady. Out of 1,732 head offered, 784 head sold for a weighted average price of $108/cwt. for delivery at 1-9 days and 1-17 days. That’s about even with last week’s country trade. There were no sales at the auction the previous week.
Similarly, slaughter steers sold mostly steady to $1 higher at Sioux Falls Regional Livestock on Wednesday. Slaughter heifers traded steady to $3 higher.
Cattle futures closed mixed on Wednesday after an up and down day of trading.
Live Cattle futures closed narrowly mixed (30¢ lower to 40¢ higher).
Feeder Cattle futures closed an average of 82¢ lower (32¢ to $1.17 lower).
Choice boxed beef cutout value was 46¢ lower Wednesday afternoon at $197.41/cwt. Select was 53¢ higher at $189.55.
******************************
Major U.S. financial indices closed higher again on Wednesday. Support included positive employment and non-manufacturing numbers.
The Dow Jones Industrial Average closed 19 points higher. The S&P 500 closed 3 points higher. The NASDAQ closed 2 points higher.
******************************
Although the September Purdue University/CME Group Ag Economy Barometer held steady from August to September, the sub-index for future expectations declined by seven points. Conversely, the sub-index for current conditions increased 10 points month to month.
“Although the decline in the Index of Future Expectations was modest, it could be an indication that some of the optimism that surfaced among producers in late 2016 and early 2017 is eroding,” says Jim Mintert, director of Purdue’s Center for Commercial Agriculture and principal investigator for the barometer. “One of the drivers of the jump in producer sentiment after the 2016 U.S. presidential election was a sharp increase in expectations about the U.S. economy. But the last two times the barometer survey has posed questions about the overall economy, respondents were noticeably less optimistic.”
For example, on the September survey, just 40% of the respondents said the U.S. economy was likely to expand, a decline of almost one-third from March when nearly 60% said they expected expansion.
Another topic on the September survey was trade agreements and negotiations, specifically the North American Free Trade Agreement (NAFTA). The survey asked respondents whether NAFTA has been good or bad for the U.S. economy, and separately, for U.S. farmers and ranchers. In both cases, more producers than not reported that the agreement had been good. In the case of the U.S. economy, 52% of respondents said they thought NAFTA had been good. Fifty-nine percent reported that they thought the agreement had been good for U.S. farmers and ranchers.”
“An unusually large percentage of survey participants—24% in the case of the U.S. economy and 20% in the case of farmers and ranchers—opted not to answer these two questions,” Mintert says. “Although we can’t say for sure why producers opted not to respond to these two questions, it might also reflect a relatively high degree of uncertainty regarding NAFTA’s impact.”
The Ag Economy Barometer is based on a monthly survey of 400 U.S. agricultural producers.