WLI

Cattle futures continued to churn higher Tuesday.

Feeder Cattle futures closed an average of 97¢ higher. Live Cattle futures closed an average of 94¢ higher (40¢ to $1.77 higher).

Corn and Soybean futures closed higher on likely positioning ahead of Wednesday’s World Agricultural Supply and Demand Estimates.

Corn futures closed 1¢ to 3¢ higher.

Soybean futures closed mostly 10¢ to 12¢ higher.

KC HRW Wheat closed mostly 6¢ 8¢ higher.

Negotiated cash fed cattle trade was inactive with very light demand in all regions through Tuesday afternoon, according to the Agricultural Marketing Service.

Last week, live prices were $178/cwt. in the Southern Plains, $183.00-$186.50 in Nebraska and $182-$184 in the western Corn Belt. Dressed prices were $290.

Choice boxed beef cutout value was $1.67 lower Tuesday afternoon at $312.12/cwt. Select was $2.09 lower at $280.24/cwt.

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Major U.S. financial indices closed higher again Tuesday with investors apparently expecting to see more data this week suggesting cooling inflation. 

The Dow Jones Industrial Average closed 317 points higher. The S&P 500 closed 29 points higher. The NASDAQ was up 75 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.65 to $1.84 higher through the front six contracts.

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Nationwide, pasture and range conditions improved some last week, according to Crop Progress report from USDA’s National Agricultural Statistics Service.

For the week ending July 9, 47% of pasture and range was rated as Good (37%) or Excellent (10%), which was 2% more than the previous week and 19% more than a year earlier. 23% was rated as Poor (15%) or Very Poor (8%), which was 2% less than a week earlier and 23% less than a year earlier. States with more than 40% of pasture and range rated as Poor or Very Poor include: Arizona (54%), Michigan (53%), Missouri (71%) and Texas (44%).

Corn and soybean condition also improved a bit.

22% of corn was silking, which was 8% more than the same time last year and 1% more than the five-year average. 55% of corn was rated, Good (45%) or Excellent (10%) condition, compared to 51% the previous week and 67% the previous year. 14% was rated as Poor (10%) or Very Poor (4%), which was 1% less than previous week but 4% more than a year earlier.

39% of soybeans were blooming, which was 9% more than a year earlier and 4% more than average. 51% of soybeans were rated in Good (44%) or Excellent (7%) condition, which was 1% more than the previous week but 11% less than the same week last year. 15% of soybeans were in Poor (11%) or Very Poor (4%) condition, the same as the previous week and 6% more than the previous year.

46% of winter wheat was harvested, which was 16% less than last year and 13% less than the average. 40% was rated in Good (33%) or Excellent (7%) condition, which was the same as a week earlier and 9% more than a year earlier. 28% was rated Poor (17%) or Very Poor (11%), which was 1% less than the previous week and 5% less than a year earlier. 

Stellar cash demand for calves and feeder cattle, along with steady to stronger cash fed cattle prices last week helped Cattle futures extend gains Monday.

Feeder Cattle futures closed an average of 65¢ higher (10¢ higher at the back to $1.00 higher).

Live Cattle futures closed an average of 40¢ higher.

Negotiated cash fed cattle trade ranged from mostly inactive with very light demand to a standstill through Monday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

Last week, live prices were steady to $1 lower in the Southern Plains at $178/cwt., $1.00 to $1.50 higher in Nebraska at $183.00-$186.50 and steady to $2 higher in the western Corn Belt at $182-$184. Dressed prices were steady at $290.

The five-area direct weighted average fed steer price last week was $182.06 on a live basis, up 73¢ from the previous week. The average fed steer price in the beef was 65¢ higher at 289.99.

Choice boxed beef cutout value was $3.11 lower Monday afternoon at $313.79/cwt. Select was $3.30 lower at $282.33/cwt.

Corn and Soybean futures closed higher on likely profit taking and positioning ahead of Wednesday’s World Agricultural Supply and Demand Estimates.

Corn futures closed mostly 4¢ to 5¢ higher.

Soybean futures closed 17¢ to 27¢ higher through Aug ’24 and then mostly 12¢ to 15¢ higher.

KC HRW Wheat closed mostly 3¢ to 7¢ lower.

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Major U.S. financial indices closed higher Monday as investors await further inflation readings this week, as well as the beginning of quarterly stock earnings reports.

The Dow Jones Industrial Average closed 209 points higher. The S&P 500 closed 10 points higher. The NASDAQ was up 24 points.

West Texas Intermediate Crude Oil futures (CME) closed 50¢ to 87¢ lower through the front six contracts.

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The U.S. beef industry trend toward tightening cattle supplies, decreased beef production and sharply higher prices are expected to impact international trade of U.S. cattle and beef, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University.

“Reduced beef supplies and higher prices are projected to lead to reduced beef exports and increased beef imports,” Peel explains in his weekly market comments. “The strength of the U.S. dollar and the impacts of exchange rates may further exaggerate or mute these underlying market forces. The relatively strong dollar in recent months has tended to dampen beef exports and support increased imports. Unique market factors in specific countries will also impact trade flows in particular markets. The most recent trade data confirms that the expected impacts are indeed developing.”

As noted in last Friday’s Cattle Current, U.S. beef exports in May were 14% less year over year for volume and down 19% for value. For January through May, volume was 10% less than the same period last year and value was down 21%.

On the other side of the equation, Peel says total beef imports to the U.S. were up 5.7% year over year in May. He adds that imports for the first five months of the year are 0.6% less than the same time last year.

“Beef imports appear to be reverting to more traditional import patterns with May imports of beef from Australia up 39.1% and imports from New Zealand up 23.2 % for the month,” Peel says. By volume, Peel explains these are the top five importers to the U.S. in this order: Canada, Mexico, Brazil, Australia and New Zealand.

“Beef imports will continue to be supported by higher domestic beef prices and the reduction in U.S. processing beef supplies due to reduced cow slaughter,” Peel says.

Lower Corn futures and producer leverage demonstrated by the week’s cash fed cattle trade helped push Cattle futures higher on Friday.

Feeder Cattle futures closed an average of $2.58 higher ($1.80 at the back to $3.27 higher toward the front).

Live Cattle futures closed an average of $1.13 higher (42¢ higher near the back to $2.42 higher at the front).

Negotiated cash fed cattle trade ranged from slow with light to moderate demand in the North, to limited on light demand in the South through Friday afternoon, according to the Agricultural Marketing Service.

For the week, live prices were steady to $1 lower in the Southern Plains at $178/cwt., steady to $1 higher in Nebraska at $183-$185 and steady to $3 higher in the western Corn Belt at $183-$184. Dressed prices were steady at $290.

Choice boxed beef cutout value Friday afternoon was $2.97 lower at $316.90/cwt. Select was $4.34 lower at $285.63/cwt.

Estimated total cattle slaughter for the holiday-shortened week of 539,000 head was 108,000 head fewer than the previous week and 49,000 head fewer than the same week last year. Year-to-date estimated total cattle slaughter of 16.8 million head was 3.6% less year over year. Year-to-date estimated beef production of 13.8 billion pounds was 676.9. million pounds less (-4.7%).

Corn and Soybean futures closed lower on a wetter weekend outlook and perhaps some positioning ahead of next week’s World Agricultural Supply and Demand Estimates, which will be USDA’s first opportunity to make adjustments to forecast yields. 

Corn futures closed mostly 6¢ to 12¢ lower.

Soybean futures closed mostly 16¢ to 21¢ lower.

KC HRW Wheat closed 21¢ to 25¢ lower.

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Major U.S. financial indices closed lower again Friday on lingering rate hike fears, despite a weaker jobs report than expected.

Total non-farm payroll employment increased by 209,000 in June, according to the U.S. Bureau of Labor Statistics. The unemployment rate was little changed at 3.6%. In June, average hourly earnings for all employees on private non-farm payrolls rose by 12¢ to $33.58.

The Dow Jones Industrial Average closed 187 points lower. The S&P 500 closed 12 points lower. The NASDAQ was down 18 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.57 to $2.06 higher through the front six contracts.

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U.S. beef exports improved month to month in May, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). However, exports remain less than last year’s record totals.

Beef exports totaled 116,159 metric tons (mt) in May, down 14% year over year but up 4% from the previous month. Export value was $874.7 million, down 19% year over year but 2% above April. May exports strengthened to Mexico, Taiwan and South Africa. Export value to Canada was the highest in nearly eight years. Beef variety meat exports were the largest in 12 months at just under 27,000 mt.

“U.S. beef exports face considerable headwinds in 2023, on both the supply and demand side, especially when compared to last year’s massive totals,” says Dan Halstrom, USMEF president and CEO. “To address tighter beef supplies, USMEF has heightened efforts to showcase underutilized cuts, even in our well-established markets. It’s also encouraging to see beef variety meat exports maintain a strong pace, as this is essential for maximizing carcass value.”

Beef export value equated to $399.71 per head of fed slaughter in May, down 21% from a year ago. The January-May average was $391.66, down 19%.

Feeder Cattle futures continued to adjust lower, down an average of $2.32 amid a bounce in Corn futures.

Live Cattle futures closed an average of 39¢ lower with apparent pressure from sliding seasonal wholesale beef values.

Corn futures bounced back Thursday with a gloomier weather outlook. They closed 12¢ to 18¢ higher through Jly ‘24, and then 6¢ to 7¢ higher.

Soybean futures closed lower on oversold conditions. They were down 15¢ to 24¢ lower through Jan ‘24, and then 7¢ to 12¢ lower.

KC HRW Wheat closed mixed, fractionally lower to 6¢ lower through May ’24 and then 3¢ to 6¢ higher.

Negotiated cash fed cattle trade ranged from slow on light demand to mostly inactive on very light demand through Thursday afternoon, according to the Agricultural Marketing Service.

On light trade, live prices were steady to $1 lower in the Southern Plains at $178/cwt. and unevenly steady in the western Corn Belt at $179-$184, where dressed prices last week were $290.

Last week, live prices in Nebraska were $180-$183 on a live basis and $290 in the beef.

Choice boxed beef cutout value was $2.91 lower Thursday afternoon at $319.87/cwt. Select was $2.72 lower at $289.97/cwt.

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Major U.S. financial indices closed lower Thursday with worries that positive employment data will fuel more interest rate hikes. Private sector employment increased by 497,000 in June, according to the ADP National Employment report. That was significantly more than expected.

The Dow Jones Industrial Average closed 366 points lower. The S&P 500 closed 35 points lower. The NASDAQ was down 112 points.

West Texas Intermediate Crude Oil futures (CME) closed mostly narrowly lower through the front six contracts.

Cattle futures showed signs of modest correction Wednesday as traders await direction from the week’s cash market.

Feeder Cattle futures closed an average of $2.79 lower ($2.17 to $3.25 lower).

Live Cattle futures closed an average of $1.14 lower (72¢ to $1.87 lower).

Negotiated cash fed cattle trade ranged from mostly inactive with very light demand to a standstill through Wednesday afternoon, according to the Agricultural Marketing Service.

Last week, live prices were $179/cwt. in the Texas Panhandle, $178 in Kansas, $182-$185 in Nebraska and $180-$183 in the western Corn Belt at $180-$183. Dressed prices were $290.

Choice boxed beef cutout value was $5.56 lower Wednesday afternoon at $322.78/cwt. Select was $1.61 lower at $292.69/cwt.

Wheat futures bounced higher Wednesday amid selling fatigue and concerns about Russia’s sword rattling.

KC HRW Wheat closed 25¢ to 50¢ higher.

Corn and Soybean futures held their own with static week over week crop conditions.

Corn futures closed mostly 1¢ to 3¢ higher, except for the front two contracts.

Soybean futures closed mostly 1¢ to 8¢ higher through Aug ‘24, and then 11¢ to 13¢ higher.

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Major U.S. financial indices resumed the trading week with softer tones Wednesday.

The Dow Jones Industrial Average closed 129 points lower. The S&P 500 closed 8 points lower. The NASDAQ was down 25 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.80 to $2.00 higher through the front six contracts.

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Agricultural producer sentiment improved last month, according to the Purdue University/CME Group Ag Economy Barometer index. It rose 17 points from the May reading to 121 in June. Producers’ perceptions of current conditions was unchanged but they were more optimistic about the future with Index of Future Expectations increasing 25 points to 123.

“Optimism about U.S. agriculture’s future and a more sanguine interest rate outlook help explain producers’ more positive view of the future expressed in June’s survey,” says James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture. “However, current conditions in the farming economy continue to present a challenge for some producers. This month four out of 10 producers stated that their financial situation has deteriorated compared to a year ago.”

The Farm Financial Performance Index also rose this month, up 10-points from May and was likely a result of a late-May to early-June rally in harvest time prices for corn and soybeans, as well as optimism towards positive returns for cattle producers.

In June, 50% of respondents said they expect “good times” for livestock producers in the next five years, up from 37% in May. Optimism about positive returns for cattle producers, especially cow-calf operations, was likely a key factor behind the positive livestock outlook.

The Ag Economy Barometer is calculated each month from 400 U.S. agricultural producers’ responses to a telephone survey. This month’s survey was conducted between June 12-16.