Negotiated cash fed cattle traded in the Southern Plains and Nebraska at $110/cwt. on a live basis Monday, which was $3 lower; $2-$5 lower in the western Corn Belt at the same money. Early dressed sales were $5-$7 lower at $175-$176.
Three lots—460 head—were offered in the weekly Fed Cattle Exchange auction. All sold for an average weighted price of $110/cwt., with delivery of 1-9 days for 384 head; 1-17 days for the remainder.
Cattle futures reversed directions again Wednesday, closing mostly limit-down and subsumed once again by coronavirus fears and sharply lower outside markets.
Live Cattle futures closed an average of $2.84 lower.
Feeder Cattle futures closed an average of $4.48 lower.
Wholesale beef values were steady on Choice and lower on Select with light to moderate demand and moderate offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 8¢ higher Wednesday afternoon at $207.17/cwt. Select was $2.22 lower at $196.49.
Corn futures closed mostly 2¢ to 4¢ lower.
Soybean futures closed 3¢ to 5¢ lower.
Incidentally, CME Group announced Wednesday evening that it will close its Chicago trading floor as of the close of business this Friday the 13th, as a precaution to reduce large gatherings that can contribute to the spread of coronavirus, in line with the advice of medical professionals. All products will continue to trade on CME Globex as they do today.
That organization joins an expanding list of companies, groups and sports leagues cancelling, suspending and altering. You may have heard the Houston Stock Show and Rodeo cancelled the remainder of this year’s run Wednesday afternoon, with 11 days left; the NCAA also announced attendance at the upcoming March Madness basketball tournaments for both women and men will be limited to players, families and essential staff…the list goes on.
Major U.S. financial indices tanked on Wednesday after the World Health Organization (WHO) declared COVID-19 a global pandemic.
In a Wednesday press briefing, Dr. Tedros Adhanom Ghebreyesus, WHO director general said, “We’re deeply concerned, both by the alarming level and spread, and by the alarming levels of inaction. We have, therefore, made the assessment that COVID-19 can be characterized as a pandemic. Pandemic is not a word to be used lightly or carelessly. It’s a word, if misused, can cause unreasonable fear or unjustifiable acceptance that the fight is over, leading to unnecessary suffering and death.”
At the time, there were 118,000 cases of COVID-19 in 114 countries and 4,291 fatalities.
According to Dr. Tedros more than 90% of current COVID-19 cases are in four countries, with the epidemic declining significantly in two of those: China and Korea. As of noon Wednesday, the Center for Disease Control and Prevention cited 938 U.S. cases, in 38 states and the District of Columbia; 29 deaths.
The Dow Jones Industrial Average closed 1,464 points lower. The S&P 500 closed 140 points lower. The NASDAQ was down 392 points.
USDA lowered expected fed steer prices (five-area direct) for this year by $2.50 from the previous month to $114.50/cwt., in the latest World Agricultural Supply and Demand Estimates (WASDE). That’s based on current price weakness, as well as increased expected beef production.
Compared to the previous month, analysts with USDA’s Economic Research Service (ERS) increased anticipated beef production this year by 220 million lbs. to 27.7 billion lbs., which would be 549 million lbs. more (+2.02%) than last year.
Total red meat and poultry production for 2020 was estimated 647 million lbs. more than the previous month at 109.43 billion lbs. That would be 4.17 billion lbs. more (+3.96%) than in 2019.
ERS pegs fed steer prices at $118 in the first quarter, $114 in the second quarter, $111 in the third quarter and $114 in the fourth quarter.
“The 2020 beef import forecast is raised from last month on higher expected imports of processing grade beef, while the export forecast is reduced on weaker anticipated demand in several markets,” say ERS analysts.
Among other WASDE highlights:
U.S. corn supply and use outlook for 2019-20 was unchanged. The season-average corn price received by producers was lowered 5¢ to $3.80/bu. based on observed prices to date.
U.S. soybean supply and use projections for 2019-20 were mostly unchanged. The U.S. season-average soybean price is projected at $8.70/bu., down 5¢. The soybean oil price is projected at 31.5¢/lb., down 2¢. Soybean meal prices are unchanged at $305/short ton.
U.S. wheat supply and demand outlook was unchanged. The projected season-average farm price is also unchanged at $4.55/bu.