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Cattle Current Daily—Jan. 21, 2020

Cattle futures and equity markets were closed Monday, in observance of Martin Luther King, Jr. Day.

Wholesale beef values were firm on moderate demand and light offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 47¢ higher Monday afternoon at $214.64/cwt. Select was 73¢ higher at $213.48.

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Despite last year’s many weather challenges, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University notes that total Dec. 1 hay stocks were 6.9% more year over year at 84.488 million tons. However, he adds the total is 5.4% less than the average for 2014-18.

“Hay stocks were generally up year over year in the Western, Mountain and Plains states, and the Corn Belt, but down in the Great Lakes, Appalachian and Eastern regions,” Peel explains, in his weekly market comments. “Missouri had the largest hay stocks and showed the most increase year over year with stocks up 64.3%, the highest level for the state since 2009. Among the top 10 states for hay stocks, Kentucky, Nebraska, Oklahoma and Tennessee had year over year declines.

According to recent USDA data, Peel says total production of all hay was 128.864 million tons, which was 4.3% more year over year—consisting of 42.6% alfalfa hay and 57.4% other hay. Total hay production was 2.4% below the 2014-2018 average.

“Total hay supplies appear to be generally adequate, although quality may be an issue in some instances,” Peel says. “However, average hay prices are projected to increase 2-4% over the previous crop year. Regionally, the tightest supplies appear to be in the Southeast, Appalachian and Great Lakes regions. Nebraska stands out as a major hay state with decreased production and stocks but surrounded on all sides by states with increased year over year hay production.”

Cattle Current Daily—Jan. 21, 2020 2020-01-20T19:46:00-06:00

Cattle Current Podcast—Jan. 20, 2020

Negotiated cash fed cattle trade through Friday afternoon was steady on a live basis in the Southern Plains and Nebraska at $124/cwt., but $1 lower in the western Corn Belt at $123-$125. Dressed sales were steady to $2 lower at $198-$200.

Cattle futures closed mixed on Friday, but with a firmer feel in Live Cattle as traders positioned ahead of the three-day weekend.

Other than unchanged and 5¢ lower in the back three contracts, Live Cattle futures close an average of 33¢ higher.

Other than 17¢ and 7¢ higher in two nearby contracts, Feeder Cattle futures closed an average of 43¢ lower amid light trade.

Wholesale beef values were higher on moderate to good demand and moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $1.27 higher Friday afternoon at $214.17/cwt. Select was $1.28 higher at $212.75.

Corn futures closed 12¢ to 13¢ higher in the front three contracts and then mostly 5¢ to 8¢ higher, basically recovering what was lost in the previous session.

Soybean futures closed 2¢ to 5¢ higher. 

Cattle Current Podcast—Jan. 20, 2020 2020-01-18T17:29:07-06:00

Cattle Current Daily—Jan. 20, 2020

Negotiated cash fed cattle trade through Friday afternoon was steady on a live basis in the Southern Plains and Nebraska at $124/cwt., but $1 lower in the western Corn Belt at $123-$125. Dressed sales were steady to $2 lower at $198-$200.

Cattle futures closed mixed on Friday, but with a firmer feel in Live Cattle as traders positioned ahead of the three-day weekend.

Other than unchanged and 5¢ lower in the back three contracts, Live Cattle futures close an average of 33¢ higher.

Other than 17¢ and 7¢ higher in two nearby contracts, Feeder Cattle futures closed an average of 43¢ lower amid light trade.

Wholesale beef values were higher on moderate to good demand and moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $1.27 higher Friday afternoon at $214.17/cwt. Select was $1.28 higher at $212.75.

Corn futures closed 12¢ to 13¢ higher in the front three contracts and then mostly 5¢ to 8¢ higher, basically recovering what was lost in the previous session.

Soybean futures closed 2¢ to 5¢ higher. 

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Major U.S. financial indices closed higher Friday, amid positive quarterly corporate earnings and economic news that included a surge in housing starts.

Privately-owned housing starts in December were at a seasonally adjusted annual rate of 1,608,000, which was 16.9% more than the revised November estimate, according to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

The Dow Jones Industrial Average closed 50 points higher. The S&P 500 closed 12 points higher. The NASDAQ was up 31 points.

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“Wholesale beef prices are below year-ago levels, but packers continue to pay slightly higher prices than a year ago to bid cattle out of the feedlots, despite weaker margins,” says analysts with USDA’s Economic Research Service (ERS), in the monthly Livestock, Dairy and Poultry Outlook, describing factors for updated first-quarter price forecasts.

“This strength was carried into first-quarter 2020, and that price forecast was raised by $3 to $125/cwt. (fed steer). However, larger numbers of cattle are expected to be available for marketing during the second quarter, which is expected to moderate prices. The 2020 average price for fed steers is forecast at $117.50.”

ERS also increased expectations for first-quarter feeder steer prices (750-800 lbs., basis Oklahoma City).

“Based on recent price data and fewer expected cattle overwintering on pasture, the price forecast for first-quarter 2020 feeder steers was raised by $4 to $144/cwt. The second-quarter 2020 price forecast was raised $2 to $144.00. The fourth-quarter 2020 price forecast was raised by $1 to $145 on expected feedlot demand. The 2020 annual price forecast for feeder steers was raised by $2 to $145.”

Cattle Current Daily—Jan. 20, 2020 2020-01-18T17:24:33-06:00

Cattle Current Weekly Highlights—Week ending Jan. 17, 2020

Although overall market optimism continued last week, weather and market volatility surrounding trade issues created some price pressure for feeder cattle and calves. Nationwide, steers and heifers sold from $1/cwt. lower to $2 higher, according to the Agricultural Marketing Service (AMS).

“Colder weather conditions combined with moisture systems affected many areas of the country, constraining receipts in some areas as producers elected to wait for better conditions before bringing cattle to town,” say AMS analysts. “Feedlots in all regions remain at or near full capacity. Grazing wheat in areas of the Southern Plains remains challenging with the current conditions, which has caused many cattle to be placed in grow yard or feedlots earlier than planned.”

Feeder Cattle futures closed an average of $1.53 lower week to week on Friday, from 45¢ lower at the back to $2.45 lower toward the front.

Regionally speaking, Andrew P. Griffith, agricultural economist at the University of Tennessee says, “The mild temperatures that have been experienced in the Southeast United States may have calf prices escalating more quickly than is typical because some stocker operations may have more grass available this time of year than they normally would. The warmer than average temperatures and adequate moisture has definitely supported winter annual forage production, and producers who graze these species are definitely looking for animals to graze and manage the growth.”

In his weekly market comments, Griffith also notes increasingly strong demand for calves with less health risk.

“Based on weekly auction market price averages, 525-pound value-added steers brought $12/cwt. more than non-value-added steers,” Griffith says. “This equates to the value-added steers bringing about $60 more per head, which more than pays for the vaccines and extra labor. This does not include the additional weight a producer may have achieved from a preconditioning program.”

Fed Cattle Prices Wobble

Negotiated cash fed cattle trade through Friday afternoon was steady on a live basis in the Southern Plains and Nebraska at $124/cwt., but $1 lower in the western Corn Belt at $123-$125. Dressed sales were steady to $2 lower at $198-$200.

“Following the strong run in finished cattle prices in December and a strong start to January, fed cattle prices have stagnated the past couple of weeks,” Griffith says. “Despite the appearance that prices stalled, this should still be considered positive for cattle feeders. January and February are not known as strong beef demand months, nor are they known for having the best finished cattle prices. The upside to current prices is that beef and cattle demand are strong in the spring, which should bode well for the price of finished cattle. There remains potential for the cash market to trade over $130 at some point, but cattle feeders are more concerned with maintaining strong prices over a longer period.”

Live Cattle futures closed an average of 57¢ lower, from 25¢ lower to $1.07 lower in spot Feb.

Wholesale beef values continued to crawl up from the seasonal ebb. Choice boxed beef cutout value was $4.13 higher week to week on Friday at $214.17/cwt. Select was $6.20 higher at $212.75.

Positive Trade Deals and Lots of Questions

U.S. agriculture, including cattle and beef, scored long-sought trade victories last week with the signing of the phase-one trade deal between the U.S. and China, as well as Senate approval of the U.S.-Mexico-Canada Agreement (USMCA). Market reaction was muted to negative, though, given the lack of clarity regarding timing and potential purchase volume.

China agreed to purchase and import, on average, at least $40 billion of U.S. food, agricultural, and seafood products annually for a total of at least $80 billion over the next two years, according to a factsheet from the U.S. Trade Representative.

“It is not likely that beef will be the big winner in the trade agreement with China as it relates to direct shipments of beef to China,” Griffith explains. “The United States ships very little beef to mainland China, and it is unlikely this agreement will change that. It is most likely that pork will witness the largest increase in purchases from China, given their depleted pork supplies from African Swine Fever, while the purchase of soybeans will also be on the top of the list. Despite the expectation that direct beef trade will not escalate quickly, moving more pork should support domestic meat protein prices and thus beef prices.”

Part of the phase-one trade deal does remove key Chinese non-tariff trade barriers to U.S. beef, which could prove to be the major win. The deal eliminates the 30-month age restriction, provides acceptance of current U.S. traceability and removes the ban on U.S. beef from cattle grown with commonly used and safe-proven growth hormones.

As for the USMCA, Canada and Mexico are the first and second largest export markets for U.S. food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018, according to USDA. Mexico and Canada account for about one-third of all U.S. red meat exports, according to the U.S. Meat Export Federation. Shipments to Mexico and Canada in 2019 totaled about 1.25 million metric tons valued at $3.8 billion.

Before ratification and signing of the latter two agreements, ERS forecast total U.S. beef exports in 2020 to increase about 6% year over year to a record 3.3 billion lbs.

Friday to Friday Change

Weekly Auction Receipts

 

Jan. 17 Auction Direct

Video/net

Total
 

281,400

(-96,100)

49,300

(-10,600)

61,700

(-32,600)

392,400

(-139,300)

 

CME Feeder Index

CME Feeder Index* Jan. 16 Change
  $145.67 –   $1.16

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Jan. 17 Change
600-700 lbs. $160.77 + $2.03
700-800 lbs. $149.77 –  $1.09
800-900 lbs. $145.81 + $1.21

 

South Central

Steers-Cash Jan. 17 Change
500-600 lbs. $164.28 + $1.36
600-700 lbs. $150.06 + $0.01
700-800 lbs. $143.76 –  $1.93

 

Southeast

Steers-Cash Jan. 17 Change
400-500 lbs. $159.36 + $2.10
500-600 lbs. $147.91 + $2.45
600-700 lbs. $137.06 + $0.82

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Jan. 17 ($/cwt) Change
Choice $214.17 + $4.13
Select $212.75 + $6.20
Ch-Se Spread $1.42 –  $2.07

 

Futures

Feeder Cattle  Jan. 17 Change
Jan ’20 $145.350 –  $2.250
Mar $145.000 –  $2.450
Apr $147.875 –  $2.175
May $149.450 –  $1.750
Aug $154.875 –  $1.425
Sep $155.950 –  $1.025
Oct $156.200 –  $0.700
Nov $156.225 –  $0.450

 

Live Cattle   Jan. 17 Change
Feb ’20 $126.350 –  $1.075
Apr $127.250 –  $0.700
Jun $119.200 –  $0.575
Aug $116.775 –  $0.500
Oct $118.900 –  $0.500
Dec $121.750 –  $0.250
Feb ’21 $123.450 –  $0.375
Apr $124.000 –  $0.450
Jun $117.125 –  $0.725

 

Corn  Jan. 17 Change
Mar ’20 $3.892 + $0.036
May $3.952 + $0.026
Jul $4.010 + $0.016
Sep $4.002 –  $0.002
Dec $4.026 -0-
Mar ’21 $4.124 -0-

 

Oil CME-WTI Jan. 17 Change
Feb $58.54 –  $0.50
Mar $58.58 –  $0.41
Apr $58.51 –  $0.34
May $58.30 –  $0.33
Jun $57.96 –  $0.36
Jly $57.54 –  $0.38

 

Equities

Equity Indexes Jan. 17 Change
Dow Industrial Average  29348.10 +  524.23
NASDAQ   9388.94 +  210.08
S&P 500   3329.62 +    64.27
Dollar (DXY)        97.64 +      0.29
Cattle Current Weekly Highlights—Week ending Jan. 17, 2020 2020-01-18T17:21:29-06:00

Cattle Current Podcast—Jan. 17, 2020

Negotiated cash fed cattle prices began to take shape through Thursday afternoon. Live prices in the Southern Plains were steady at $124/cwt. Although too few to trend, early dressed prices up north were steady to $2 lower at $198-$200, based on USDA reports.

Although backing away from session lows, reduced momentum in the cash market helped push Cattle futures lower, as did likely selling and profit taking by those who provided fuel ahead of the phase-one trade agreement between the U.S. and China. That and Senate ratification of the U.S.-Mexico-Canada Agreement (USMCA), which replaces the North American Free Trade Agreement hold plenty of promise, but plenty of questions remain.

Live Cattle futures close an average of 51¢ lower.

Feeder Cattle futures closed unchanged to an average of 27¢ lower through the front five contracts and then an average of 6¢ higher.

Wholesale beef values were firm to higher on moderate to fairly good demand and moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 37¢ higher Thursday afternoon at $212.90/cwt. Select was $1.80 higher at $211.47.

Corn futures closed 11¢ to 12¢ lower in the front three contracts and then mostly 5¢ to 7¢ lower.

Soybean futures closed 1¢ to 4¢ lower through Sep ’21 and then mostly 1¢ higher.

Cattle Current Podcast—Jan. 17, 2020 2020-01-16T19:10:33-06:00

Cattle Current Daily—Jan. 17, 2020

Negotiated cash fed cattle prices began to take shape through Thursday afternoon. Live prices in the Southern Plains were steady at $124/cwt. Although too few to trend, early dressed prices up north were steady to $2 lower at $198-$200, based on USDA reports.

Although backing away from session lows, reduced momentum in the cash market helped push Cattle futures lower, as did likely selling and profit taking by those who provided fuel ahead of the phase-one trade agreement between the U.S. and China. That and Senate ratification of the U.S.-Mexico-Canada Agreement (USMCA), which replaces the North American Free Trade Agreement (see below) hold plenty of promise, but plenty of questions remain.

Live Cattle futures close an average of 51¢ lower.

Feeder Cattle futures closed unchanged to an average of 27¢ lower through the front five contracts and then an average of 6¢ higher.

Wholesale beef values were firm to higher on moderate to fairly good demand and moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 37¢ higher Thursday afternoon at $212.90/cwt. Select was $1.80 higher at $211.47.

Corn futures closed 11¢ to 12¢ lower in the front three contracts and then mostly 5¢ to 7¢ lower.

Soybean futures closed 1¢ to 4¢ lower through Sep ’21 and then mostly 1¢ higher.

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Major U.S. financial indices closed strongly higher Thursday, buoyed by positive economic news and quarterly earnings reports.

The Dow Jones Industrial Average closed 267 points higher. The S&P 500 closed 27 points higher. The NASDAQ was up 98 points.

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The U.S. Senate, on Thursday, approved the U.S.-Mexico-Canada Agreement (USMCA), which replaces the North American Free Trade Agreement (NAFTA).

“We’ve long waited for this day and now USMCA will finally head to the President’s desk,” said U.S. Secretary of Agriculture Sonny Perdue. “The passage of USMCA is great news for America’s farmers and ranchers. With Congressional consideration now complete, our farmers and ranchers are eager to see the President sign this legislation and begin reaping the benefits of this critical agreement.”

Canada and Mexico are the first and second largest export markets for United States food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018, according to USDA.

All food and agricultural products that have zero tariffs under the North American Free Trade Agreement (NAFTA) will remain at zero tariffs. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the United States and Canada, the USMCA will create new market access opportunities for United States exports to Canada of dairy, poultry, and eggs. In exchange, the U.S. will provide new access to Canada for some dairy, peanut, and a limited amount of sugar and sugar-containing products.

“This year, we’ve secured new agreements with Japan, China, Canada and Mexico—four of our largest trading partners—which gives producers greater market access for their products and a renewed sense of optimism heading into the 2020 growing season,” explained Iowa Secretary of Agriculture Mike Naig.

According to the U.S. International Trade Commission, Naig explained full implementation of USMCA could increase U.S. agricultural exports by $2.2 billion.

“The U.S. Senate moving quickly to approve USMCA reaffirms the United States’ commitment to two key trading partners, both of which are very important destinations for U.S. pork, beef and lamb,” says Dan Halstrom, president and CEO of the U.S. Meat Export Federation (USMEF).

Mexico and Canada account for about one-third of all U.S. red meat exports, according to USMEF. Shipments to Mexico and Canada in 2019 totaled about 1.25 million metric tons valued at $3.8 billion.

Cattle Current Daily—Jan. 17, 2020 2020-01-16T19:08:17-06:00

Cattle Current Podcast—Jan. 16, 2020

Cash fed cattle trade remained undeveloped through Wednesday afternoon, but early indicators were for at least steady prices.

For instance, Choice steers and heifers sold $2 higher at the fat auction in Tama, IA. Ch 2-4 steers (144 head) weighing an average of 1,416 lbs. sold for an average of $126.26/cwt.

Similarly, slaughter steers and heifers sold $2-$3 higher at Sioux Falls Regional in South Dakota. There were 201 Ch 2-3 steers weighing an average of 1,440 lbs. and bringing an average of $122.41.

Country trade in the western Corn Belt last week was at $124-$126.

There were 734 head offered in Wednesday’s Fed Cattle Exchange auction, with 435 head—two lots of steers in the Southern Plains—selling for a weighted average price of $124.22 for delivery at 1-9 days. The price was a tick higher than last week’s country trade in the region.

Futures market reaction to signing of the phase-one trade deal between the U.S. and China (see below) was largely muted Wednesday, likely a combination of some betting on the come ahead of the deal and the fact that details remain sketchy.

Live Cattle futures close an average of 19¢ lower.

Feeder Cattle futures closed an average of 35¢ lower through the front five contracts and then an average of 44¢ higher.

Wholesale beef values were steady to weak on light to moderate demand and moderate to heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 23¢ lower Wednesday afternoon at $212.53/cwt. Select was 63¢ lower at $209.67.

Corn futures closed mostly 1¢ lower.

Soybean futures closed 10¢-13¢ lower through Sep ’21 and then 8¢ lower.

Cattle Current Podcast—Jan. 16, 2020 2020-01-15T20:40:47-06:00

Cattle Current Daily—Jan. 16, 2020

Cash fed cattle trade remained undeveloped through Wednesday afternoon, but early indicators were for at least steady prices.

For instance, Choice steers and heifers sold $2 higher at the fat auction in Tama, IA. Ch 2-4 steers (144 head) weighing an average of 1,416 lbs. sold for an average of $126.26/cwt.

Similarly, slaughter steers and heifers sold $2-$3 higher at Sioux Falls Regional in South Dakota. There were 201 Ch 2-3 steers weighing an average of 1,440 lbs. and bringing an average of $122.41.

Country trade in the western Corn Belt last week was at $124-$126.

There were 734 head offered in Wednesday’s Fed Cattle Exchange auction, with 435 head—two lots of steers in the Southern Plains—selling for a weighted average price of $124.22 for delivery at 1-9 days. The price was a tick higher than last week’s country trade in the region.

Futures market reaction to signing of the phase-one trade deal between the U.S. and China (see below) was largely muted Wednesday, likely a combination of some betting on the come ahead of the deal and the fact that details remain sketchy.

Live Cattle futures close an average of 19¢ lower.

Feeder Cattle futures closed an average of 35¢ lower through the front five contracts and then an average of 44¢ higher.

Wholesale beef values were steady to weak on light to moderate demand and moderate to heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 23¢ lower Wednesday afternoon at $212.53/cwt. Select was 63¢ lower at $209.67.

Corn futures closed mostly 1¢ lower.

Soybean futures closed 10¢-13¢ lower through Sep ’21 and then 8¢ lower.

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Major U.S. financial indices edged higher Wednesday. While there appeared to be optimism for the signed phase-one trade deal between the U.S. and China, as mentioned earlier, details were scant.

The Dow Jones Industrial Average closed 90 points higher. The S&P 500 closed 6 points higher. The NASDAQ was up 7 points.

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There are plenty of questions to be answered, but Wednesday’s signing of the phase-one trade agreement between the U.S. and China appears to be a massive win for U.S. agriculture, as well as the nation as a whole.

“China will purchase and import on average at least $40 billion of U.S. food, agricultural, and seafood products annually for a total of at least $80 billion over the next two years,” according to a factsheet from the U.S. Trade Representative (USTR). “Products will cover the full range of U.S. food, agricultural, and seafood products.”

In 2017, before the trade war, U.S. agricultural exports to China were $23.8 billion, representing more than 17% of total U.S. agricultural exports, according to the Minnesota Department of Agriculture.

Although there are no details about the specific allocation of China’s agricultural purchases, the agreement paves the way to historic access for U.S. beef, via the removal of non-tariff trade barriers that hamstrung U.S. beef exports for years. Arguably, these were the primary ones:

**China continued to restrict U.S. beef imports from cattle 30 months of age or older. That restriction was imposed when bovine spongiform encephalopathy was discovered in this nation in 2003, but it remained in place, despite the “Negligible” risk status assigned to the U.S. by the World Organization for Animal Health.

**China banned beef from cattle grown with commonly used and safe-proven growth hormones (implants) and beta agonists.

**China demanded a bookend traceability system, knowing where cattle were born and where they were slaughtered.

The new agreement lifts those barriers, according to Kent Bacus, senior director of international trade and market access for the National Cattlemen’s Beef Association (NCBA), in a media call Wednesday afternoon.

“China will expand the scope of beef products allowed to be imported, eliminate age restrictions on cattle slaughtered for export to China, and recognize the U.S. beef and beef products’ traceability system,” according to the USTR factsheet. “China will establish maximum residue levels for three synthetic hormones legally used for decades in the United States, consistent with Codex Alimentarius Commission (Codex) standards and guidelines. Where Codex standards do not exist, China will use MRLs (maximum residue limits) established by other countries that have performed science-based risk assessments.”

Presumably, the latter ultimately could open the door to U.S. beef grown with use of beta agonists.

Further, according to USTR, “The Parties agreed to not implement food safety regulations that are not science-and risk-based and shall only apply such regulations to the extent necessary to protect human life or health…” 

USDA estimates U.S. beef and beef product exports to China could reach $1 billion annually. According to Bacus, U.S. beef exports to China totaled $60 million in 2018 and $70 million through the first 11 months of last year.

NCBA president, Jennifer Houston calls the agreement a game changer for U.S. beef.

“When you’ve got a country (China) with 1.4 billion people, and their middle class is larger than the U.S. population, I’m not sure that there is any other event in the past that has more potential to grow our markets like this does,” Houston explained, during the media call.

Cattle Current Daily—Jan. 16, 2020 2020-01-15T20:38:39-06:00

Cattle Current Podcast—Jan. 15, 2020

Wholesale beef values bounced higher Tuesday on good demand and light to moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.21 higher in the afternoon at $212.76/cwt. Select was $2.07 higher at $210.30.

That and stronger Lean Hog futures helped Live Cattle futures close an average of 22¢ higher.

Other than unchanged and 10¢ higher in the back two contracts, Feeder Cattle futures closed an average of 12¢ lower.

Corn futures closed fractionally lower to 1¢ lower.

Soybean futures closed fractionally lower to 1¢ lower.

Cattle Current Podcast—Jan. 15, 2020 2020-01-14T21:02:05-06:00

Cattle Current Daily—Jan. 15, 2020

Wholesale beef values bounced higher Tuesday on good demand and light to moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.21 higher in the afternoon at $212.76/cwt. Select was $2.07 higher at $210.30.

That and stronger Lean Hog futures helped Live Cattle futures close an average of 22¢ higher.

Other than unchanged and 10¢ higher in the back two contracts, Feeder Cattle futures closed an average of 12¢ lower.

Corn futures closed fractionally lower to 1¢ lower.

Soybean futures closed fractionally lower to 1¢ lower.

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Major U.S. financial indices closed mixed and little changed Tuesday, with better than expected quarterly earnings from the likes of J.P Morgan Chase, but skittishness over Wednesday’s scheduled signing of the phase-one trade deal between the U.S. and China.

The Dow Jones Industrial Average closed 32 points higher. The S&P 500 closed 4 points lower. The NASDAQ was down 22 points.

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“Beef exports are generally expected to be strong in 2020,” says Josh Maples, Extension livestock economist at Mississippi State University. “The latest World Agricultural Supply and Demand Estimates (WASDE) projection for 2020 beef exports is 3.3 billion lbs., which would be a new record and about 9% above 2019 levels.”

Although U.S. beef exports in 2019 look to be less year over year—4.6% less for January through November—in the latest issue of In the Cattle Markets, Maples emphasizes it was not a weak year.

“The 3.02 billion lbs. of 2019 beef exports projected by WASDE would trail only the 3.16 billion lbs. exported in 2018,” Maples says.

Heading into 2020, Maples notes the bevy of trade deals, either recently signed or in progress and ultimately signed, will add support.

As well, both African Swine Fever and the horrendous fires in Australia promise to impact the global flow of animal proteins. 

With respect to the latter, in his weekly market comments, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says, “Wildfires (in Australia) have burned over 15 million acres, an area the size of West Virginia, and are not yet under control as of Jan. 10. Roughly 9% of the Australian cattle herd is in areas significantly impacted by the fires; another 11% are in regions partially impacted by the fires.”

Drought-forced herd liquidation pushed last year’s Australian beef production and exports higher than previously projected, with female slaughter reaching record proportions of total cattle slaughter, according to Peel. This year, he says Australian beef production is forecast to decrease nearly 15% year over year to the lowest level since 2010. Australian exports are projected to decline by more than 19%, compared to 2019.

“It is mid-summer in Australia and the drought continues unabated with severe rainfall deficits and above average temperatures,” Peel explains. “Additional herd liquidation is likely if conditions do not improve. In any event, Australian cattle and beef production will be reduced for the foreseeable future and rebuilding, whenever it can begin, will take several years.”

Cattle Current Daily—Jan. 15, 2020 2020-01-14T21:00:07-06:00

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.