Another day of weaker Corn futures and the outlook for steady to stronger cash fed cattle prices this week helped Cattle futures extend gains Wednesday.
Feeder Cattle futures closed an average of $1.46 higher.
Live Cattle futures closed an average of 63¢ higher (25¢ higher in the spot month to $1.10 higher).
Expectations of record production in Brazil helped pressure Corn futures Wednesday.
Corn futures closed mostly 1¢ to 3¢ lower.
KC HRW Wheat closed 2¢ to 6¢ higher in the front three contracts and then mostly 1¢ to 2¢ lower.
Soybean futures closed mostly 6¢ to 16¢ lower.
Negotiated cash fed cattle trade ranged from limited on light demand to a standstill through Wednesday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Last week, live prices were $170-$171/cwt. in the Texas Panhandle, $171 in Kansas, $180-$182 in Nebraska and $182 in the western Corn Belt. Dressed prices were $280-$286 in Nebraska and $285 in the western Corn Belt.
Choice boxed beef cutout value was 88¢ higher Wednesday afternoon at $305.84/cwt. Select was 62¢ lower at $287.77/cwt.
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Major U.S. financial indices closed lower Wednesday with investors focused on continued debt ceiling talks.
The Dow Jones Industrial Average closed 134 points lower. The S&P 500 closed 25 points lower. The NASDAQ was down 82 points.
West Texas Intermediate Crude Oil futures (CME) closed $1.29 to $1.37 lower through the front six contracts.
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USDA forecast beef exports for fiscal year (FY) 2023 at $9.3 billion, in the quarterly Outlook for U.S. Agricultural Trade from the Economic Research Service (ERS) and Foreign Agricultural Service (FAS). The total would be $700 million less than February’s projection on weaker unit values for beef muscle cuts more than offsetting firm shipments to Mexico and East Asia.
Total livestock, poultry, and dairy exports were lowered $1.2 billion to $39.3 billion with lower beef and poultry estimates outweighing gains in dairy.
U.S. agricultural exports were forecast at $181.0 billion, down $3.5 billion from the February forecast. This revision was driven by decreases in corn, wheat, beef, and poultry exports.
“Corn exports are forecast $2.1 billion lower to $14.5 billion on lower unit values and volumes as Brazil is poised to harvest a record second crop of corn,” say ERS and FAS analysts.
For overall perspective, the global economic outlook remained mostly unchanged.
“Inflation remains on a slowing trend, but economic growth challenges are materializing as monetary conditions tighten,” explains ERS and FAS analysts. “North America is still projected to grow moderately, with growth in the Eurozone projected to remain at lower levels. World real gross domestic product (GDP) is projected to increase by 2.8% in 2023, unchanged from the previous forecast.”
The quarterly outlook pegs projected growth for the United States’ real GDP in 2023 0.2% higher at 1.6%.