Early indications for negotiated cash fed cattle trade this week appeared to be steady to lower on Wednesday.
Although too few transactions to trend, there were some early sales in the western Corn Belt $1-$2 lower than last week at $112-$115/cwt. Dressed sales were steady to $4 lower $180-$184.
Likewise, Choice 2-4 steers traded $2.00-$2.50 lower at the fat auction in Tama, IA: an average of $118.11/cwt. for steers weighing an average of 1,329 lbs.
On the other hand, slaughter steers sold steady to firm at Sioux Falls Regional in South Dakota: $113.98/cwt. for Ch 2-3 at an average of 1,373 lbs.
There were only three lots (315 head) offered in the weekly Fed Cattle Exchange auction, and no sales.
Perhaps cash uncertainty was one reason behind sputtering Cattle futures, despite stronger Lean Hogs and softer Corn. Along with continued fretting over demand and sluggish trade, erosion might also be linked to position squaring.
Live Cattle futures closed an average of 77¢ lower (15¢ lower at the back to $1.07 lower).
Except for 13¢ higher in three away contracts, Feeder Cattle futures closed an average of 37¢ lower, amid extremely light trade.
Corn futures closed 8¢ to 9¢ lower through Jul ‘20 and then mostly 1¢ to 3¢ lower.
Soybean futures closed 8¢ to 11¢ lower through Mar ‘20 and then 5¢ to 6¢ lower.
Incidentally, heading into Friday’s monthly Cattle on Feed report, analysts surveyed for Bloomberg expect May placements to be about 4% less year over year, May marketings to be nearly 1% more and the on-feed inventory June 1 to be a little over 1% more.
Wholesale beef values were firm to higher on moderate to firm demand, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.06 higher Wednesday afternoon at $221.59/cwt. Select was 44¢ higher at $202.24.
Major U.S. financial indices edged higher Wednesday. Although the Federal Open Market Committee (FOMC) left interest rates unchanged, markets seemed buoyed by indications that the Fed was leaving the door open to rate cuts.
“The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2% objective as the most likely outcomes, but uncertainties about this outlook have increased,” according to an FOMC statement. “In light of these uncertainties and muted inflation pressures, the Committee will closely monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion…”
The Dow Jones Industrial Average closed 38 points higher. The S&P 500 closed 8 points higher. The NASDAQ was up 33 points.
As many folks trying to lease or buy pasture in recent years can attest, the value continues to rise. USDA’s Agricultural Land Values-Final Estimates released yesterday provide some perspective. The average value of pasture increased every year, from $1,290 per acre in 2014 to $1,370 in 2018.
Conversely, average Cropland value in 2018 was $4,050 per acre, $20 less than a year earlier and $40 less than in 2014.
Some examples of average pasture value for the states with the most beef cows: Texas ($1,570); Oklahoma ($1,380); Missouri ($1,920); Nebraska ($975); South Dakota ($1,040); Kansas ($1,320); Montana ($667); Kentucky ($3,000).