WLI

Negotiated cash fed cattle trade was active on very good demand in Nebraska Wednesday with live prices steady at $144-$145/cwt. and dressed prices mainly steady to $4 lower at $228.

Trade was slow on moderate demand in the western Corn Belt, where there were a few live sales at $144-$145 and a few in the beef at $228, but too few to trend, according to the Agricultural Marketing Service. Prices there last week were $145-$148 and $227-$234, respectively.

Trade in the Southern Plains ranged from limited to mostly inactive on light demand. Live prices there the previous day were steady at $143.

Choice boxed beef cutout value was 88¢ lower Wednesday afternoon at $247.55/cwt. Select was $2 lower at $219.21.

Cattle futures weakened again Wednesday with hangover pessimism from recent sessions.

Feeder Cattle futures closed an average of 72¢ lower (32¢ to $1.12 lower).

Live Cattle futures closed an average of 50¢ lower except for 15¢ higher in the back contract.

Corn and Soybean futures crawled higher, perhaps on increasing Russian rhetoric and positioning ahead of Friday’s Grain Stocks report.

Corn futures closed mostly 3¢ higher.

Soybean futures closed 5¢ to 9¢ higher.

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Major U.S. financial indices rallied Wednesday, apparently based mainly on oversold conditions. 

The Dow Jones Industrial Average closed 549 points higher. The S&P 500 closed 72 points higher. The NASDAQ was up 222 points.

West Texas Intermediate Crude Oil futures (CME) closed $2.82 to $3.65 higher through the front six contracts.

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Economic conditions continue to deteriorate in the 10-state region dependent on agriculture and/or energy, monitored by the Rural Mainstreet Index (RMI).    

“The Rural Mainstreet economy is now experiencing a downturn in economic activity. Supply chain disruptions and inflationary pressures from higher farm input costs continue to constrain growth,” says Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business. “Farmers and bankers are bracing for escalating interest rates, higher farm input costs, and drought.”

The Creighton University Rural Mainstreet Index (RMI) fell for the fifth straight month, sinking below growth neutral for a fourth consecutive month, according to the monthly survey of bank CEOs.

Four of 10 bankers indicated that high and escalating farm input costs were the greatest economic challenge to their bank and area over the next 12 months.

More than one of five, or 21.4%, of bank CEOs reported drought impacts were the greatest economic challenge going forward.

Cattle futures continued lower with outside markets Tuesday.

Feeder Cattle futures closed an average of $1.02 lower.

Live Cattle futures closed an average of 67¢ lower.

Negotiated cash fed cattle trade was steady in the Southern Plains Tuesday at $143/cwt. on slow trade and moderate demand.

Elsewhere, trade was inactive on light demand.

Last week, live prices were $144-$145 in Nebraska and $145-$148 in the western Corn Belt. Dressed prices were $228-$232 in Nebraska and $227-$243 in the western Corn Belt.

Choice Boxed beef cutout value was $1.07 higher Tuesday afternoon at $248.91/cwt. Select was 1.27 lower at $222.08/cwt.

Corn futures closed 1¢ to 2¢ higher through Jly ‘23 and then mostly unchanged to fractionally lower.

Soybean futures closed 1¢ to 3¢ lower through Aug ‘23 and then mostly fractionally higher.

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Major U.S. financial indices closed mixed Tuesday as a relief rally from recent steep losses fell short. 

The Dow Jones Industrial Average closed 125 points lower. The S&P 500 closed 7 points lower. The NASDAQ was up 26 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.14 to $1.79 higher through the front six contracts.

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Winter wheat planting increased 10% week to week (Sept. 25), according to the latest USDA Crop Progress report.

31% of winter wheat was planted, which was 10% more than the previous week, 1% less than last year but 1% more than the five-year average. 9% was emerged, which was 7% more than the previous week, 2% more than last year and 3% more than average.

26% of pasture and range was rated as Good (22%) or Excellent (4%), which was 2% less than a week earlier but 3% more than a year earlier. Conversely, 43% was rated as Poor (23%) or Very Poor (20%), which was the same as the previous week but 3% less than a year earlier.

92% of corn was dented, which was 4% less than last year and 2% less than the five-year average. 58% was mature, which was 14% less than a year earlier and 3% less than average. 12% was harvested, which was 5% less than last year and 2% less than the average. 52% was rated as Good (42%) or Excellent (10%), which was the same as the prior week but 7% less than a year earlier. 21% was rated Poor (12%) or Very Poor (9%) the same as a week earlier but 6% more than a year earlier.

63% of soybeans were dropping leaves, which was 10% less than last year and 2% less than the average. 8% were harvested, compared to 15% last year and 13% for average. 55% were rated as Good (46%) or Excellent (9%) which was the same as the previous week and 3% less than the prior year. 15% were rated Poor (10%) or Very Poor (5%), which was the same as the previous week but 1% more than the prior year.

Cattle futures weakened further Monday, along with other commodities and financial markets as fears about a contracting economy, high unabated inflation and increasing interest rates ruled the day.

Feeder Cattle futures closed an average of $1.75 lower ($1.20 lower toward the front to $2.40 lower in the back contract.

Live Cattle futures closed an average of $1.32 lower (77¢ to $1.70 lower).

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

Last week, live prices were $143/cwt. in the Southern Plains, $144-$145 in Nebraska and $145-$148 in the western Corn Belt. Dressed prices were $228-$232 in Nebraska and $227-$243 in the western Corn Belt.

Choice boxed beef cutout value was 79¢ lower Monday afternoon at $247.84/cwt. Select was $4.04 higher at $223.35.

Corn futures closed 8¢ to 11¢ lower through Sep ’23 and then mostly 5¢ lower.

Soybean futures closed mostly 11¢ to 15¢ lower.

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Major U.S. financial indices closed sharply lower again Monday with the surging dollar and continued   worries about climbing interest rates and recessionary fears.

The Dow Jones Industrial Average closed 329 points lower. The S&P 500 closed 38 points lower. The NASDAQ was down 65 points.

West Texas Intermediate Crude Oil futures (CME) closed $2.03 to $2.14 lower through the front six contracts.

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“Both feedlot inventories and cattle slaughter have remained stubbornly high this year due to drought-forced movement of cattle out of the country. Total fed cattle slaughter thus far in 2022 is up 0.8% as the 1.7% decrease in steer slaughter for the year to date is offset by a 4.9% increase in heifer slaughter,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Total cow slaughter is up 5.6% so far this year, driven by a 13.4% increase year over year in beef cow slaughter. Total cattle slaughter is up 1.8% year over year thus far in 2022, with female (cow plus heifer slaughter) accounting for 50.9% of total cattle this year. Cattle slaughter and beef production are projected to decrease year over year in the fourth quarter but higher than expected beef production in the first three quarters of the year likely mean that annual totals for beef production will be steady or fractionally higher year over year. Feedlot production, cattle slaughter and beef production are all expected to decrease sharply in 2023.”

Referencing Friday’s Cattle on Feed report, Peel explains, feedlot inventories grow seasonally in the fall but are expected to increase less this year and trail last year’s record levels.

“In the past four months — May – August — total placements were down 0.6% year over year with placements under 700 lbs. up 5.3% and placements over 700 pounds down 3.7% compared to last year. Past placements of lightweight cattle suggest fewer cattle available for placement going forward,” Peel says.

Cattle futures softened again Friday amid sharply lower outside markets, rising interest rates and perhaps some prescient defensiveness ahead of the monthly Cattle on Feed report.

Feeder Cattle futures closed an average of 61¢ lower, except for an average of 28¢ higher in two contracts.

Live Cattle futures closed an average of 89¢ lower.

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

Based on the last established trends, live prices for the week were $1 higher in the Southern Plains at $143/cwt., steady to $4 higher in the western Corn Belt at $148 and $1 higher in Nebraska at $144. Dressed prices were $2-$8 higher in the western Corn Belt at $228-$234 and $2-$5 higher in Nebraska at $228-$232.

Choice Boxed beef cutout value was 23¢ higher Friday afternoon at $248.63/cwt. Select was $2.80 lower at $219.31/cwt.

Corn and Soybean futures softened Friday with outside market concerns, including the impact the climbing U.S. dollar will have on exports.

Corn futures closed 10¢ to 13¢ lower.

Soybean futures closed 28¢ to 31¢ lower through Aug ‘23 and then 20¢ to 25¢ lower.

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Major U.S. financial indices closed sharply lower Friday as investors focused on climbing interest rates and recessionary fears.

The Dow Jones Industrial Average closed 468 points lower. The S&P 500 closed 64 points lower. The NASDAQ was down 198 points.

CME WTI Crude Oil futures closed $4.29 to $4.78 lower through the front six contracts.

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Feedlot placements were higher than expected again in August, according to the latest monthly Cattle on Feed report for feedlots with 1,000 head or more capacity. Placements in August of 2.11 million head were 9,000 head more year over year (+0.4%) but almost 2% more than pre-report expectations.

In terms of placement weights, 35% went on feed weighing 699 lbs. or less, 47% were 700-899 lbs. and 18% weighed 900 lbs. or more.

Marketings in August of 2.00 million head were 120,000 head more (+6.4%), which was in line with expectations.

Cattle on feed Sept 1 of 11.3. million head were 45,000 head more (+0.4%) than the previous year, which also mirrored expectations ahead of the report. It was the second largest inventory for the date since the data series began in 1996.

Negotiated cash fed trade ranged from slow to moderate on moderate demand in the Southern Plains through Thursday afternoon, according to the Agricultural Marketing Service. Prices so far this week are $1 higher at $143/cwt.

Elsewhere, trade was moderate on moderate to good demand.

Dressed trade in Nebraska was $2-$5 higher at $228-$232. Live prices there last week were $143.

In the western Corn Belt, live prices this week are steady to $1 higher at $144-$145 and $2 higher in the beef at $228

Even so, Cattle futures continued to weaken Thursday with pressure from struggling outside markets and likely positioning ahead of Friday’s Cattle on Feed report. Pre-report estimates expect placement to be down 1% or so compared to last year and on-feed numbers to be about even.

Feeder Cattle futures closed an average of $1.41 lower, except for 2¢ higher in spot Sep.

Live Cattle futures closed an average of 85¢ lower (30¢ to $1.40 lower).

Cattle futures are weaker again through noon today.

Corn and Soybean futures paddled in place Thursday with ongoing pressure from lower outside markets and the higher U.S. dollar, but also speculation about lower yields.

Corn futures closed mostly fractionally higher to 2¢ higher.

Soybean futures closed 2¢ to 4¢ lower through Jly ‘23 and then mostly fractionally mixed.

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Major U.S. financial indices closed lower again Thursday with growing concern about recession as the Fed battles inflation.

The Dow Jones Industrial Average closed 107 points lower. The S&P 500 closed 31 points lower. The NASDAQ was down 153 points.

CME WTI Crude Oil futures closed 55¢ to 66¢ higher through the front six contracts.

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“August cutout data showed a strong resurgence in interest for Prime graded beef, approaching levels not seen since January of 2022,” according to analysts with the Livestock Marketing information Center, in its Livestock Monitor. “The Prime cutout value was $330.57/cwt., up from July’s $317.51 value, and just short of January’s peak for the year of $341.12. Interestingly, other grades of beef cutout failed to rally and were even with the month before. Branded, Choice, and Select cutout values have held the $275-$250 range since March 2022.”

The loin and rib drove increased Prime cutout value.

“The strong interest in prime rib and loin values is associated with a seasonal component that has become much more pronounced since 2017 in the premiums between Prime and other grades of beef,” LMIC analysts say. “Fall of 2021 was one of the largest historical cutout spreads, in which Prime commanded more than $80/cwt. over Choice. Prime Rib values are on pace to approach last year’s high point, while Prime loin values are slightly weaker.” 

LMIC analysts point out 7.6% of carcasses graded Prime in August versus 8.7% the prior year.