Negotiated cash fed cattle trade remained undeveloped in the Northern Plains and western Corn Belt through Thursday afternoon. So far in the Southern Plains this week, live sales are $1-$2 lower at $124/cwt.
Even so, Cattle futures rallied sharply higher. Along with presumed technical support, the most plausible explanation is chatter about the U.S. and China nearing a trade deal and the notion that once-done, domestic commodities will reap significant benefit. There are lots of assumptions throughout the scenario, and plenty betting on them.
Except for 50¢ higher in the back contract, Live Cattle futures closed an average of $1.94 higher.
Feeder Cattle futures closed an average of $1.85 higher (85¢ to $2.85 higher).
Corn futures closed mostly 1¢ to 2¢ higher.
Soybean futures closed 6¢ to 7¢ higher.
Wholesale beef values were firm on Choice and weak on Select, with light to moderate demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 60¢ higher Thursday afternoon at $226.74/cwt. Select was 61¢ lower at $218.36.
Other than higher for the Dow, major U.S. financial indices closed narrowly mixed Thursday. Primary support seemed to be the aforementioned chatter that the U.S. and China are getting close to announcing a trade deal.
The Dow Jones Industrial Average closed 166 points higher. The S&P 500 closed 5 points higher. The NASDAQ was down 3 points.
“While restaurant operators continued to report positive same-store sales in February, customer traffic turned negative for the first time in five months,” according to the latest Restaurant Performance Index (RPI) report from the National Restaurant Association (NRA). “Although 50% of operators expect their sales to be higher in six months–the highest level in over a year–their outlook for the overall economy remains uncertain.”
Specifically, 37% of restaurant operators reported year-over-year increased customer traffic in February; 44% reported a decline.
The RPI declined slightly month to month in February to 101.1. The index measures the health of the restaurant industry relative to a neutral level of 100. According to NRA, “Index values above 100 indicate that key industry indicators are in a period of expansion, while index values below 100 represent a period of contraction for key industry indicators.”
The RPI consists of the Current Situation Index and the Expectations Index. The former was lower for the third consecutive month.