Whether it was retrenching for another run or a rudderless lull, Cattle futures stabilized by session’s end on Thursday, with lower corn prices helping buoy Feeder Cattle futures.
After 45¢ and 5¢ lower in the front two contracts, Live Cattle futures closed an average of 40¢ higher (32¢ to 60¢ higher).
Feeder Cattle futures closed an average of 84¢ higher (35¢ to $1.15 higher).
Choice boxed beef cutout value was 39¢ lower Thursday afternoon at $212.74/cwt. Select was 59¢ lower at $198.30.
*****************************
Major U.S. financial indices closed lower on Thursday, pressured by a slide in tech stocks and chatter about the Senate version of tax reform potentially delaying implementation until 2019.
The Dow Jones Industrial Average closed 101 points lower. The S&P 500 closed 9 points lower. The NASDAQ closed 39 points lower.
******************************
“The forecast for 2017 total red meat and poultry production is lowered from last month as lower beef, pork, and turkey production more than offsets higher broiler production,” say analysts with USDA’s Economic Research Service (ERS), in the latest World Agricultural Supply and Demand Estimates (WASDE). “Beef production is reduced from the previous month on a slower expected marketing pace for fed cattle in the fourth quarter and lighter carcass weights.”
For next year, however, total red meat production is forecast higher than in last month’s estimates, based on higher beef and pork production.
“Beef production (2018) is raised from last month as higher expected placements in the latter part of 2017 and first-half 2018 are expected to support higher marketings and fed cattle slaughter in 2018,” ERS analysts explain. “However, carcass weights are expected to be slightly lower.”
Projected cattle prices increased for 2017 and the first-half 2018. WASDE forecasts fourth-quarter fed steer prices at $117-$121/cwt. with the annual average price projected $2 higher at $121.80. First-quarter prices next year are forecast at $116-$124; second quarter at $112-$122.
Corn production for this year is forecast 298 million bu. higher than last month at 14.578 billion bu. The increase is based on an estimated record-high yield of 175.4 bu./acre, which is 3.6 bu./acre more than in the October forecast. Ending stocks are projected 147 million bu. more than last month. The estimated season-average corn price received by farmers was unchanged at $3.20/bu.
Soybean production is forecast 5 million bu. lower at a record 4.425 billion bu. based on an estimated fractional decrease in yield. The season-average soybean price is projected 10¢ higher at the midpoint at $9.30/bu. Soybean meal prices are estimated $5 higher at bother ends of the range at $295-$335/short ton. Soybean oil price projections are unchanged at 32.5¢ to 36.5¢/lb.
Ending wheat stocks were projected 25 million bu. lower based on increased exports. Although estimated ending stocks of 935 million bu. are 246 million bu. less than the previous year, they’re still above the 5-year average. The season-average farm price for wheat was unchanged at the midpoint at $4.60/bu.