Although too few to trend, negotiated cash fed cattle trade took on a lower feel Tuesday with early live trades in Kansas and Nebraska at $119-$120/cwt., compared to $121 last week.
Cattle futures continued lower, pressured by the softer tone of the cash market.
Live Cattle futures closed an average of $1.11 lower (67¢ to $1.50 lower).
Feeder Cattle futures closed an average of $1.10 lower.
Wholesale beef values were lower on Choice and higher on Select with light to moderate demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.08 lower Tuesday afternoon at $207.83/cwt. Select was 83¢ higher at $204.53.
Corn futures closed mostly 1¢ lower.
Soybean futures closed unchanged to fractionally higher.
Major U.S. financial indices paddled in place Tuesday with various reports suggesting the spread of novel coronavirus is slowing.
The Dow Jones Industrial Average closed fractionally lower. The S&P 500 closed 5 points higher. The NASDAQ was up 10 points.
The latest World Agricultural Supply and Demand Estimates (WASDE) increased projected beef production for this year by 40 million lbs. compared to the January estimate at 27.48 billion lbs.
“The beef production forecast is raised from the previous month on higher cattle slaughter and heavier cattle weights in the first half of the year. However, the forecasts for second-half beef production is reduced on lower anticipated steer and heifer slaughter in the second half of the year,” explain USDA analysts. “This reflects a smaller number of cattle outside feedlots implied by the Jan. 1 Cattle report which results in lower placements during 2020.”
Total red meat and poultry production was projected 634 million lbs. more at 108.79 billion lbs.
The annual fed steer price (five-area direct) was projected at $117/cwt: $123 for the first quarter; $118 for the second; $112 for the third; $114 for the fourth quarter.
Among other WASDE highlights:
U.S. corn ending stocks were unchanged from the previous month. The season-average corn price received by producers was also unchanged at $3.85/bu.
This month’s 2019-20 U.S. soybean outlook is for increased exports and lower ending stocks.
Soybean ending stocks were reduced 50 million bu. to 425 million, partly reflecting increased imports for China.
The U.S. season-average soybean price for 2019-20 was forecast at $8.75/bu., down 25¢, reflecting reported prices to date. The soybean oil price forecast was lowered 0.5¢ to 33.5¢/lb. The soybean meal price forecast was unchanged at $305/short ton.