Daily Market Highlights

Negotiated cash fed cattle trade was $1 higher at $120/cwt. in Kansas through Thursday afternoon. Although too few to trend, live sales were generally $1-$2 higher at $120-$121 in Nebraska and at $121 in the western Corn Belt. Early dressed sales were $2-$4 higher at $192.

Cattle futures were mixed on Thursday but closed mostly slightly higher, supported by stronger cash prices and sluggish trade.

Live Cattle futures closed mixed, from an average of 34¢ lower across the front four contracts to an average of 27¢ higher. 

Other than 7¢ lower in Mar, Feeder Cattle futures closed an average of 40¢ higher (7¢ to 85¢ higher).

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

Choice boxed beef cutout value was 58¢ lower Thursday afternoon at $208.99/cwt. Select was also 58¢ lower at $200.99.

Corn futures closed fractionally mixed through Jul ’21 and then unchanged to 4¢ higher.

Soybean futures closed 3¢ to 4¢ lower through Aug ’20 and then mostly 1¢ lower.

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Major U.S. financial indices closed higher Thursday, as investors seemed to ignore mixed economic news and the House vote to impeach president Trump.

The Dow Jones Industrial Average closed 137 points higher. The S&P 500 closed 14 points higher. The NASDAQ was up 59 points.

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The U.S. House of Representatives approved implementing legislation for the U.S.-Mexico-Canada Agreement (USMCA), by a vote of 385-41.

“Ratification of USMCA is an important step in solidifying trade relations with Mexico and Canada, which are critical destinations for U.S. pork, beef and lamb,” says Dan Halstrom, president and CEO of the U.S. Meat Export Federation. “This agreement will bolster the United States’ position as a reliable supplier to two leading markets that currently account for about one-third of all U.S. red meat exports.”

“Today was a crucial win for all U.S. beef producers and a reassurance that U.S. beef will continue to have duty-free access to Canada and Mexico,” says Jennifer Houston, president of the National Cattlemen’s Beef Association (NCBA).

Now, it’s up to the Senate to pass the legislation and President Trump to approve.

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Red meat and pork production were record high in November at 4.74 billion lbs., which was 1% more than the previous year, according to USDA’s monthly Livestock Slaughter report. For January through November, it was 3% more at 50.3 billion lbs.

Beef production in November of 2.30 billion lbs. was 1% less than the previous year. Cattle slaughter of 2.77 million head was also 1% less. Through November, beef production was 129.3 million lbs. more (+0.50%) than the same period last year at 24.89 billion lbs.

More recently, average steer carcass weights for the week ending Dec. 7 were 5 lbs. lighter than the previous week at 906 lbs., according to USDA’s most recent weekly Actual Slaughter Under Federal Inspection report. That was 10 lbs. heavier than the prior year. The average heifer carcass weight of 840 lbs. was even with the prior week and 5 lbs. heavier than the prior year. Total cattle slaughter for the week of 682,077 head was the most in more than two years. Fed cattle slaughter of 536,210 head was the most since June. Total beef production for the week was 564.8 million lbs., the most in more than two years.

Pork production totaled 2.43 billion lbs. in November, up 3% from the previous year. Hog slaughter of 11.3 million head was 3% higher year over year. For January through November, pork production was 5% more than the same period last year.

Prospects for negotiated cash fed cattle prices got a shot in the arm from the weekly Fed Cattle Exchange auction Wednesday. One lot of Texas steers—268 head—sold out of a total offering of 878 head, for a weighted average price of $120/cwt., which was $1 higher than last week’s country trade in the region.

Similarly, Choice steers and heifers sold $1.00-$1.50 higher at the fat auction in Tama, IA. There were 305 Ch 2-4 steers weighing an average of 1,453 lbs. and bringing an average price of $120.54, which was at the upper end of the previous week’s country price.

Cattle futures wavered, amid the lack of cash direction and sluggish overall trade.

Other than 2¢ higher in spot Dec, Live Cattle futures closed an average of 25¢ lower. 

Other than 7¢ higher toward the back, Feeder Cattle futures closed an average of 52¢ lower.

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

Choice boxed beef cutout value was $3.24 lower Wednesday afternoon at $209.57/cwt. Select was $1.90 lower at $201.57.

Corn futures closed 1¢ to 3¢ lower.

Other than fractionally lower in the front four contracts, Soybean futures closed 1¢ to 4¢ higher.

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Major U.S. financial indices closed narrowly mixed Wednesday, amid mixed news and continuing optimism surrounding the presumed phase-one U.S.-China trade deal.

The Dow Jones Industrial Average closed 27 points lower. The S&P 500 closed 1 point lower. The NASDAQ was up 4 points.

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Although narrowing recently, analysts with the Livestock Marketing Information Center (LMIC) point out the Choice-Select spread was $19-$27/cwt. from June through November, well above the previous year and the five-year average. They explain the spread typically begins to narrow following peak summer beef demand around Independence Day.

According to LMIC, in the latest Livestock Monitor, 70.9% of carcasses graded Choice through November, which was 1% less than the prior year. Prime-grading carcasses were higher, though, at 8.5%.

“Interestingly, total cattle slaughter through the first week of December is 1.4% above last year at 31.1 million head. Slaughter data does not indicate that there is a lack of cattle available, but there is a lack of Choice grade cattle,” say LMIC analysts. “A factor contributing to the lower available supplies of Choice product are cattle graded for branded programs. Branded programs typically include higher quality-grade cattle, which may contain cattle that grade Choice and/or Prime.”

More specifically, quality-based brands commonly target carcasses that grade in the upper two thirds of Choice. So far this year, USDA certified 31.5% of fed cattle for that category, according to LMIC. That’s 7.4% more than last year.

“Branded boxed beef prices have been commanding an average of $5.30/cwt. above the Choice boxed beef price, indicating that there may be more Choice product going into channels for branded products,” say LMIC analysts. “The relatively higher price for branded boxed beef products over Choice products, and more cattle qualifying for branded programs, may be contributing to lower availability in the Choice category.”

Negotiated cash fed cattle trade remained undeveloped through Tuesday afternoon.

Feeder Cattle futures mostly edged higher and Live Cattle mostly wandered lower.

Live Cattle futures closed an average of 38¢ lower (5¢ to 95¢ lower) to an average of 7¢ higher.

Feeder Cattle futures closed an average of 14¢ higher, except for 10¢ and 27¢ lower on either end of the board.

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

Choice boxed beef cutout value was $4.27 lower Tuesday afternoon at $212.81/cwt. Select was $2.04 lower at $203.47.

Corn futures closed mostly 1¢ higher through Jly ‘21; and then fractionally lower to 1¢ lower.

Soybean futures closed mostly 3¢ to 4¢ higher through Jan. ’21 and then mostly 1¢ higher.

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Major U.S. financial indices crept higher Tuesday. Support included more new housing starts than expected.

Total housing starts increased 3.2% in November to a seasonally adjusted annual rate of 1.37 million units, according to a report from the U.S. Housing and Urban Development and Commerce Department.

The November reading of 1.37 million starts is the number of housing units builders would begin if they kept this pace for the next 12 months, according to the National Association of Home Builders (NAHB). Within this overall number, single-family starts increased 2.4% to a 938,000 seasonally adjusted annual rate off downwardly revised estimates for recent months.

“Market conditions for single-family starts are positive, given a lack of resale inventory, low interest rates and a solid job market,” says Greg Ugalde, NAHB chairman and a home builder and developer from Torrington, Conn. “Builder confidence points to additional gains as we look forward.”

The Dow Jones Industrial Average closed 31 points higher. The S&P 500 closed 1 point higher. The NASDAQ was up 9 points.

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“Despite wholesale prices declining from abnormally high levels in mid November, packers continue to pay higher prices to bid cattle out of the feedlots,” say analysts with USDA’s Economic Research Service (ERS), in the latest monthly Livestock, Dairy and Poultry Outlook. “Greater fed cattle slaughter may in part reflect the packers’ inclination to capture stronger than typical margins as wholesale boxed beef prices averaged well above 2018 during November and into early December. Feedlots also have a higher proportion of cattle on feed over 150 days, and the narrowing of the Choice-Select spread may also be providing incentives to bring additional cattle to market.”

USDA recently increased its projected fourth-quarter fed steer price by $2 to $114/cwt. Forecast prices for the first two quarters of next year were raised to $122 and $118, respectively.

In turn, ERS also increased projected prices for feeder cattle (basis Oklahoma City).

Based on recent price data, the fourth-quarter 2019 feeder steer price was raised by $3 to $147/cwt. The 2020 annual price forecast for feeder steers was raised by $2 to $144.

Quarterly feeder steers prices for 2020 are projected at: $140 in the first quarter, $142 in the second quarter and $147 in the third quarter.

As for cull cows, ERS analysts point out the average price for the week ending Dec. 6 was $53.76/cwt., which was 16% higher than a year earlier. “This, coupled with tight forage supplies for some producers, is likely encouraging a higher culling rate.” Beef cow slaughter continues well above last year’s pace.

Negotiated cash fed cattle trade ended up steady to $1 higher in the Southern Plains last week at $119/cwt. on a live basis; steady to $2.50 higher in the Northern Plains at $119.00-$120.50. Dressed trade was steady to $2 higher at $188-$190.

Week to week the 5-area average direct live steer price was just 25¢ higher at $119.17, but with average live weights 34 lbs. heavier at 1,506 lbs. In the beef, the average steer price was 10¢ less at $188.00 with average dressed weights 45 lbs. heavier at 992 lbs.

Cattle futures wandered narrowly lower Monday, maintaining most of the previous session’s strong gains, and in the face of higher Corn futures.

Live Cattle futures closed an average of 18¢ lower, except for 5¢ higher in the back contract.

Feeder Cattle futures closed an average of 43¢ lower, except for 5¢ higher in the back contract

Wholesale beef values were higher on light to moderate demand and offerings, according to the Agricultural Marketing Service. Gains over the last two days suggest the seasonal bottom might be established.

Choice boxed beef cutout value was 79¢ higher Monday afternoon at $217.08/cwt. Select was $1.27 higher at $205.51.

Corn futures closed mostly 5¢ to 6¢ higher through Jly ‘21; and then mostly 2¢ to 3¢ higher.

Soybean futures closed 10¢ to 14¢ higher through Jan. ’21 and then mostly 3¢ higher.

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Major U.S. financial indices closed higher on Monday, with follow-through optimism from the U.S.-China phase-one trade deal announced last week.

The Dow Jones Industrial Average closed 100 points higher. The S&P 500 closed 22 points higher. The NASDAQ was up 79 points.

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Hide prices continue to dilute byproduct value, which ranged from $8.24/cwt. to $9.30 so far this year.

“Hide values are down 32% from a year ago from January to November,” say analysts with the Livestock Marketing Information Center (LMIC). “On a per hundredweight basis, January through November of 2019 (hides) averaged $47.85/cwt. compared to $70.37 in 2018. This year’s values will be the lowest annual average for hides since the start of this data set in 1992.”

Based on data from USDA’s Foreign Agricultural Service (FAS) for January through October, they say cattle hides that were sold as parts are 74% less than last year and those sold whole are down 5%.

Meat and bone meal is 14% less than the same period last year, although some offal prices are higher, such as for tripe and tongues, which are up 34% and 25%, respectively.

In the latest Livestock Monitor, LMIC analysts say most offal products are consumed overseas. For example, they explain South Africa is the largest destination for U.S. bovine kidneys. Purchases by that nation are up 26% year-over-year and kidney prices are 13% higher.

Similarly, Egypt buys more than half of the beef livers exported by the U.S,; those prices are up 3%.

Negotiated cash fed cattle trade continued to develop through Friday afternoon at no worse than steady money, according to USDA reports. Early live sales were at $119/cwt. in Nebraska and at $120 in the western Corn Belt. Early dressed sales were steady in the western Corn Belt at $188 and as much as $6 higher in Nebraska at $188-$194. Earlier in the week, live sales were steady in Kansas at $119. The Texas Cattle Feeders Association reported its members selling steers steady at $119 and heifers $1 higher at nearly $119.

Cattle futures closed sharply higher Friday, buoyed by strong demand and anticipation of snugger fed cattle supplies heading into the next quarter. Trader optimism was likely heightened by the phase-one trade agreement between the U.S. and China.

“U.S. pork and beef products have been subject to burdensome retaliatory duties in China since 2018, and this has made it very difficult for the U.S. industry to capitalize on China’s rapidly growing need for high-quality proteins. But long before retaliatory duties entered the picture, non-tariff barriers were a major, persistent obstacle for U.S. exporters looking to expand their business in China,” says Dan Halstrom, president and CEO of the U.S. Meat Export Federation. “China is the world’s largest and fastest-growing destination for imported red meat, and the U.S. industry is excited about the prospects for expanded opportunities in China.”

Live Cattle futures closed an average of $1.42 higher (70¢ to $2.45 higher).

Feeder Cattle futures closed an average of $2.09 higher ($1.42 to $3.12 higher).

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

Choice boxed beef cutout value was 64¢ higher Friday afternoon at $216.29/cwt. Select was $1.68 higher at $204.24.

Corn futures closed mostly 2¢ to 3¢ higher through Jly ‘21; and then mostly unchanged.

Soybean futures closed 7¢ to 9¢ higher through Jan. ’21 and then mostly 3¢ to 5¢ higher.

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Major U.S. financial indices edged higher on Friday, more subdued than might be expected, given the aforementioned phase-one trade agreement between the U.S. and China. But then, there weren’t many details to go along with the announcement.

“The United States and China have reached an historic and enforceable agreement on a Phase One trade deal that requires structural reforms and other changes to China’s economic and trade regime in the areas of intellectual property, technology transfer, agriculture, financial services, and currency and foreign exchange,” according to a statement from the U.S. Trade Representative on Friday. “The Phase One agreement also includes a commitment by China that it will make substantial additional purchases of U.S. goods and services in the coming years. Importantly, the agreement establishes a strong dispute resolution system that ensures prompt and effective implementation and enforcement. The United States has agreed to modify its Section 301 tariff actions in a significant way.”

The United States first imposed tariffs on imports from China based on the findings of the Section 301 investigation on China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation.  The United States will be maintaining 25% tariffs on approximately $250 billion of Chinese imports, along with 7.5% tariffs on approximately $120 billion of Chinese imports.

The Dow Jones Industrial Average closed 3 points higher. The S&P 500 closed fractionally higher. The NASDAQ was up 17 points.

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“A smaller forecasted spring-born 2020 calf crop and a normal summer growing season sets the stage for next year’s fall-weaned calves to price near to slightly above 2017’s prices (i.e., above both 2018 and 2019 prices),” say analysts with the Livestock Marketing Information Center (LMIC), in the latest Livestock Monitor.

That’s based on low feed costs and fed cattle prices projected to be 1-4% higher year over year, strengthened by another year of declining domestic per capita beef supplies, as beef imports decrease and beef exports increase.

Other than the ever-present risk of drought, LMIC analysts believe the primary potential headwind to the price forecast would come with faltering trade relative to growing total red meat and poultry production.

“U.S. per capita supply of all red meat and poultry was record large in 2019,” say LMIC analysts. “Next year (2020) there will be significantly more, and that assumes exports of beef, pork, chicken, and turkey all establish new all-time highs.”

Negotiated cash fed cattle trade was light on light to moderate demand in Kansas through Thursday afternoon, based on USDA reports. Prices were steady with last week at $119/cwt.

Cattle futures closed narrowly mixed again on Thursday.

Live Cattle futures closed from an average of 18¢ lower to an average of 14¢ higher.

Feeder Cattle futures closed from an average of 25¢ lower to an average of 13¢ higher.

Wholesale beef values were sharply lower on Choice and lower on Select with light demand and heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $3.00 lower Thursday afternoon at $215.65/cwt. Select was $1.16 lower at $202.56.

Corn futures closed mostly 4¢ to 6¢ higher; 9¢ higher in spot Dec.

Soybean futures closed 2¢ to 4¢ higher through Nov. ’20 and then fractionally higher to 1¢ higher.

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Major U.S. financial indices closed higher on Wednesday, buoyed by reports that the U.S. and China reached a phase-one trade deal, which awaited President Trump’s signature.

The Dow Jones Industrial Average closed 220 points higher. The S&P 500 closed 26 points higher. The NASDAQ was up 63 points.

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“Most current signals indicate the overall domestic economy is on firm footing, thanks almost exclusively to the consumer,” says Dan Kowalski, vice president of CoBank’s Knowledge Exchange division (CKE). “However, without a meaningful U.S.-China trade deal, the U.S. agricultural economy will continue to struggle with uncertainty in 2020.”

For perspective, CKE analysts explain GDP growth in rural counties since 2014 has averaged almost 1% less than in urban counties. That trend is likely to continue without a significant upswing in agricultural commodity prices, energy exploration, rural manufacturing and other industries upon which rural economic growth depend.

Despite that bearish prognosis, and lingering uncertainty surrounding trade issues, CKE analysts believe some agriculture sectors will see stronger exports and higher prices next year.

CoBank’s 2020 Year Ahead outlook report, released Thursday, examines 10 key factors that will shape agriculture and market sectors that serve and impact rural communities throughout the U.S.

Among the highlights:

Animal Protein and Dairy

With dairy and animal protein production looking toward another year of increased production in 2020, a rebound in exports will be critical to profitability in both sectors, according to CKE. Per capita consumption of animal protein in the U.S. will likely set a new record in 2019. Strong demand and rising exports, though, will not erase financial stress at the farm level. Producers of beef, pork, poultry, and dairy will likely experience stress from higher feed costs due to lower crop yields this fall.

Grain, Farm Supply and Biofuels

Challenges for the grain sector will persist in 2020, fueled by commodity price pressure, policy uncertainty and export weakness amid growing global supply abundance, especially for corn and soybeans. U.S. wheat producers and exporters, though, may benefit from an improved export pace in 2020 with the Russian wheat crop struggling. Biofuels also face challenges in 2020. U.S. ethanol production, according to the U.S. Energy Information Administration, is expected to fall by 1.9% in 2019 to 15.8 billion gallons and remain flat in 2020.

Global Economy

Consumer strength the world over has prevented further slowing in the global economy. The direction and severity of the U.S.-China trade dispute will continue to have the most significant influence on the world economy in 2020. A leveling off of trade tensions would allow global economic growth to bottom out in early 2020 before showing signs of life later in the year. However, the vulnerable state of the global economy makes it susceptible to contraction if trade conditions worsen.

U.S. Economy

The U.S. economy will enter 2020 decisively split—powered by a resilient and confident consumer but hamstrung by a risk-averse business sector that has stopped investing. Now that stimulus effects from the 2017 tax reform and the 2018 spending bill have faded, the economic expansion will show its age, losing steam in the coming year. There is evidence that since 2017 more people, including those in rural communities, have broadly shared the benefits of economic growth, despite the continual rise in wealth inequality.

Negotiated cash fed cattle trade remained mostly undeveloped through Wednesday afternoon, with too few transactions to trend in any region.

There were 1,068 head offered in the weekly Fed Cattle Exchange auction, but no takers.

Midwestern fat auction prices were less than encouraging: $1-$2/cwt. lower at Sioux Falls, a touch lower at Tama. Yet, logic suggests packers need to be somewhat aggressive given the upcoming mid-week holidays.

Despite the lack of cash direction, Cattle futures closed higher Wednesday.

Live Cattle futures closed an average of 60¢ higher.

Feeder Cattle futures closed an average of 78¢ higher (47¢ higher at the back to $1.15 higher toward the front).

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

Choice boxed beef cutout value was $2.84 lower Wednesday afternoon at $218.65/cwt. Select was $1.63 lower at $203.72.

Corn futures closed 4¢ to 5¢ lower through Jul ’20 and then mostly 1¢ to 2¢ lower.

Soybean futures closed 5¢ to 7¢ lower through Nov. ’20 and then 3¢ to 4¢ lower.

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Major U.S. financial indices edged higher on Wednesday. Support included the Federal Reserve’s decision to leave interest rates unchanged. Further, economic projections of Federal Reserve Board members and Federal Reserve Bank presidents suggest little to no change next year.

“Information received since the Federal Open Market Committee (FOMC) met in October indicates that the labor market remains strong and that economic activity has been rising at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low,” according to the FOMC statement. “Although household spending has been rising at a strong pace, business fixed investment and exports remain weak. On a 12‑month basis, overall inflation and inflation for items other than food and energy are running below 2%. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed.”

The Dow Jones Industrial Average closed 29 points higher. The S&P 500 closed 9 points higher. The NASDAQ was up 37 points.

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U.S. Senator Deb Fischer (R-Neb.), a member of the Senate Agriculture Committee, introduced the Real MEAT Act on Tuesday to end deceptive labeling practices for alternative protein products. The bill would clarify the definition of beef for labeling purposes, eliminate consumer confusion resulting from misbranding, and ensure that the federal government is able to enforce the law. 

“Beef is derived from cattle—period. Under USDA, beef undergoes a rigorous inspection and labeling process, but plant-based protein products that mimic beef and are sometimes labeled as beef are overseen by the FDA instead. These products are not held to the same food safety and labeling standards as beef. Americans deserve to know what’s on their dinner plate. The Real MEAT Act will protect consumers from deceptive marketing practices and bring transparency to the grocery store,” Fischer explains.

Senator Fischer cited a study by the National Cattlemen’s Beef Association (NCBA) that found 55% of consumers did not understand that “plant-based beef” wasn’t beef at all. This bill would help to clear the confusion by codifying a definition of beef for labeling purposes and allowing the USDA to take action against misbranded products, she explains.

“It’s clear that fake-meat companies are continuing to mislead consumers about the nutritional merits and actual ingredient composition of their products,” says NCBA president Jennifer Houston. “We commend the efforts of Senator Fischer on introducing this legislation, which would end deceptive labeling of fake meat products and allow cattle producers to compete on a level playing field.”

The Senate bill is a companion to H.R. 4881, which was introduced by U.S. Representatives Roger Marshall (R – 1st Dist., Kansas) and Anthony Brindisi (D – 22nd Dist., N.Y.) in October.

Cattle futures closed narrowly mixed for the second consecutive session on Tuesday, amid seasonally declining wholesale beef prices and awaiting cash direction.

Live Cattle futures closed from an average of 22¢ lower across the front half of the board to an average of 11¢ higher.

Other than unchanged and 5¢ lower in Sep and Oct, Feeder Cattle futures closed an average of 26¢ higher.

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

Choice boxed beef cutout value was $2.15 lower Tuesday afternoon at $221.49/cwt. Select was $1.14 lower at $205.35.

Corn futures closed mostly 1¢ to 2¢ higher.

Soybean futures closed mostly 1¢ to 3¢ higher.

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Major U.S. financial indices edged lower on Tuesday. Pressure was broadly attributed to positioning ahead of the U.S. tariff increase on Chinese imports scheduled to begin this weekend.

The Dow Jones Industrial Average closed 27 points lower. The S&P 500 closed 3 points lower. The NASDAQ was down 5 points.

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U.S. ratification of the United States-Mexico-Canada Trade Agreement (USMCA) took a major step forward Tuesday with agreement between the U.S. Trade Representative and House democrats, who had refused to schedule a vote unless there were revisions.

“USMCA is a big win for American workers and the economy, especially for our farmers and ranchers,” says U.S. Secretary of Agriculture Sonny Perdue. “The agreement improves virtually every component of the old NAFTA, and the agriculture industry stands to gain significantly. President Trump and Ambassador Lighthizer are laying the foundation for a stronger farm economy through USMCA and I thank them for all their hard work and perseverance to get the agreement across the finish line. While I am very encouraged by today’s breakthrough, we must not lose sight—the House and Senate need to work diligently to pass USMCA by Christmas.”

Canada and Mexico are the first and second largest export markets for United States food and agricultural products, totaling more than $39.7 billion worth of food and agricultural exports in 2018. These exports support more than 325,000 American jobs.

Under the new agreement, all food and agricultural products that have zero tariffs under the North American Free Trade Agreement will remain at zero tariffs.

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USDA’s Economic Research Service (ERS) reduced expectations of U.S. beef production next year, in the monthly World Agricultural Supply and Demand Estimates released Tuesday. That’s based on the anticipated slower pace of fed and non-fed cattle slaughter in the first half of the year.

For 2020, total beef production is forecast to be 27.51 billion lbs., which would be 379 million lbs. more (+1.40%) than this year’s 27.14 billion lbs.

USDA increased the projected average fed steer price in the fourth quarter by $3 to $115/cwt., compared to the previous month. The estimated annual average price for 2019 increased $1 to $117.

For next year, the average fed steer price is projected $2 higher at $122 in the first-quarter; $1 higher in the second quarter at $118; $1 lower in the third quarter at $112. Next year’s annual average price was estimated $1 higher at $117.

Total U.S. red meat and poultry production next year is projected to increase 2.70% to a staggering 108.14 billion lbs., with higher broiler production more than offsetting lower expected beef production.

Cattle futures closed narrowly mixed Monday, unable to get much lift from stronger cash prices or last week’s massive total cattle slaughter of an estimated 679,000 head under federal inspection.

Live Cattle futures closed narrowly mixed, from an average of 11¢ lower to an average of 18¢ higher.

Feeder Cattle futures closed narrowly mixed, from an average of 19¢ lower to an average of 32¢ higher.

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

Choice boxed beef cutout value was 92¢ lower Monday afternoon at $223.64/cwt. Select was 81¢ lower at $206.49.

Corn futures closed fractionally lower to 1¢ lower.

Soybean futures closed mostly 5¢ to 7¢ higher.

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Major U.S. financial indices closed lower on Monday, with no definitive source. Profit taking and rally fatigue could have been part of it, as well as ongoing skittishness regarding U.S-China trade talks.

The Dow Jones Industrial Average closed 105 points lower. The S&P 500 closed 9 points lower. The NASDAQ was down 34 points.

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Agricultural producer sentiment rose 17 points month to month in November, to the second highest level of the year, according to the most recent Purdue University/CME Group Ag Economy Barometer.

“Except in the northern Corn Belt, farmers were wrapping up their fall harvest in November and yields were better than expected earlier this year, which helped boost sentiment along with news that the trade dispute might be settled soon,” says James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture. “Since early fall, cattle prices also rallied substantially, helping make both cattle ranchers and feeders feel better about their operations’ finances.”

The Index of Current Conditions—one sub-index of the Barometer—soared 38 points to 153 in November. The Index of Future Expectations edged 7 points higher. The barometer is based on a mid-month survey of 400 U.S. crop and livestock producers.

Confidence in a quick resolution to the U.S.-China trade dispute increased to its highest point since the question was first posed in March of this year. In November, 57% of respondents say they expect a resolution soon; only 29% did in August.

Moreover, 80% of respondents expect the trade dispute to be resolved in a way that favors U.S. agriculture, up 5% from the previous month.