Cattle Current Daily—Mar. 3, 2020

Cattle Current Daily—Mar. 3, 2020

Negotiated cash fed cattle trade remained largely undeveloped through Thursday afternoon. However, according to the Agricultural Marketing Service (AMS), there was a light test of live sales in all regions Wednesday at mostly $112/cwt. and at $175-$180 in the beef. That was $6-$8 less than last week on a live basis and $10-$15 less dressed.

Cattle future tumbled further Thursday, pressured by beef demand uncertainty, declining wholesale beef values and softer cash prices.

Live Cattle futures closed an average of $4.28 lower, expanded limit-down in the front four contracts.

Feeder Cattle futures closed an average of $6.31 lower, expanded limit-down in the front five contracts.

Wholesale beef values were sharply lower on light demand and offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.53 lower Thursday afternoon at $232.64/cwt. Select was $3.01 lower at $222.12.

The average dressed steer weight for the week ending Mar. 21 was 3 lbs. lighter than the previous week at 898 lbs., but 32 lbs. heavier than the same time a year earlier, according to USDA’s Actual Slaughter Under Federal Inspection report. The average dressed heifer weight was 836 lbs., which was 1 lb. heavier than the prior week and 32 lbs. heavier than the previous year.

Corn futures closed mostly fractionally higher to 2¢ higher.

Soybean futures closed 2¢ to 4¢ lower through Sep ‘20 and then mostly 2¢ to 4¢ higher.

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Major U.S. financial indices closed higher Thursday. Support included a surge in crude oil prices, tied to reports that Saudi Arabia and Russia agreed to end their price war.

West Texas Intermediate Crude Oil futures on the CME closed $1.48 to $5.01 higher through the front six contracts.

The Dow Jones Industrial Average closed 469 points higher. The S&P 500 closed 56 points higher. The NASDAQ was up 126 points.

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The AMS reporter on hand for this week’s sale at Green City Livestock Auction in Missouri aptly summed up the current market situation: “It’s really a different world since the last sale in early March as the economy as a whole and the beef sector in particular has absorbed hit after hit. Volatile doesn’t seem a strong enough word to describe the situation anymore, as daily limit up and down moves at the CME are almost expected; even harder to swallow is that it’s driven by funds and not fundamentals. Those big moves take all the confidence out of a cash market and make it difficult for producers to decide when to turn loose as well as for buyers to figure what one is worth. Locally, lots of cattlemen have already held their stock longer than they normally would, waiting for the market to stabilize.”

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U.S. beef exports are projected to be $100 million less than last year at $7.5 billion, according to the latest quarterly Outlook for U.S. Agricultural Trade from USDA’s Economic Research Service and Foreign Agricultural Service. At the same time, analysts with those agencies project total livestock, poultry and dairy exports to be $500 million more at $32.4 billion, led by gains in poultry. Expectations for pork exports remained unchanged.

Global GDP) for this year remained unchanged from the November forecast at 1.5%. Expected U.S. GDP was reduced 0.2% to 1.1% on diminished business prospects.

“A slowdown across the Eurozone, declining growth rates in China and the recent damaging global impact of the Covid-19 outbreak is expected to dampen growth prospects worldwide,” say USDA and FAS analysts.

2020-04-02T19:30:52-05:00

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