Cattle Current Daily—Dec. 11, 2019

Cattle Current Daily—Dec. 11, 2019

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.

2019-12-10T19:28:25-06:00

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