Cattle futures closed higher Friday, supported by lower corn prices suggested by the monthly World Agricultural Supply Demand Estimates (see below).
Feeder Cattle futures closed an average of $2.20 higher on Friday and an average of $6.53 higher week to week ($2.95 to $8.20 higher).
Live Cattle futures closed an average of $1.02 higher ($1.65 higher toward the front to 12¢ higher at the back). They were an average of $2.27 higher week to week on Friday ($1.82 higher at the back to $2.95 higher toward the front).
Negotiated cash fed cattle trade was limited on light to moderate demand in all regions through Friday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
For the week, live prices were $2 lower in the Southern Plains at $170/cwt., mostly steady to $2 lower in Nebraska at mainly $176 and $1 lower to $3 higher in the western Corn belt at $175-$177. Dressed prices were $1 lower in Nebraska at $280 and steady to $5 lower in the western Corn Belt at $280.
Estimated cattle slaughter last week of 646,000 head was 23,000 head more than the previous week but 15,000 head fewer than the same week last year. Year-to-date estimated cattle slaughter of 11.9 million head was 386,000 head fewer (-3.1%). Estimated year-to-date beef production of 9.8 billion pounds was 483.8 million pounds less (-4.7%).
Choice boxed beef cutout value was $1.11 lower Friday afternoon at $304.61/cwt. Select was 10¢ higher at $284.68/cwt.
USDA’s Economic Research Service increased forecast fed steer prices (five-area direct) higher for the remainder of this year, in the latest monthly World Agricultural Supply and Demand Estimates (WASDE). Prices were projected $3 higher in the second quarter at $172/cwt., and $2 higher in the third and fourth quarters at $164 and $169, respectively. The annual average price estimate increased $2 to $166.50.
“The 2023 cattle price forecast is raised on recent data and tighter supplies expected later in the year,” ERS analysts say. “For 2024, cattle prices are forecast above 2023 on tighter supplies.”
Estimated beef production this year would be 1.4 million pounds less than last year (-4.8%).
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As mentioned, Corn and Soybean futures closed lower Friday with the World Agricultural Supply and Demand Estimates forecasting record or near record production and increased ending stocks for both.
Corn futures closed mostly 2¢ to 4¢ lower, except for fractionally higher to 4¢ higher in remaining old-crop contracts. Week to week, they closed an average of 21’7¢ lower through the front six contracts.
The WASDE 2023/24 U.S. corn outlook was for larger production, greater domestic use and exports, and higher ending stocks. ERS projected the corn crop at a record 15.3 billion bushels, up more than 10% from last year on increases to both area and yield. The yield projection of 181.5 bushels per acre was based on a weather-adjusted trend assuming normal planting progress and summer growing season weather. With beginning stocks up slightly, total corn supplies were forecast at 16.7 billion bushels, the highest since 2017/18.
The season-average farm price was projected at $4.80 per bushel, down $1.80 from 2022/23.
Soybean futures closed mostly 17¢ to 24¢ lower on Friday. They were an average of 50’4¢ lower through the front six contracts lower week to week.
The 2023/24 outlook for U.S. soybeans was for higher supplies, crush, and ending stocks, and lower exports compared with 2022/23. The soybean crop was projected at 4.51 billion bushels, up 5% from last year’s crop mainly on higher yields. With lower beginning stocks partly offsetting increased production, soybean supplies were forecast at 4.75 billion bushels, up 4% from 2022/23.
The 2023/24 U.S. season-average soybean price was forecast at $12.10 per bushel, which would be $2.10 less than 2022/23. Soybean meal prices were forecast $90 less than last year at $365 per short ton. Soybean oil prices were forecast 6¢ less at 58¢ per pound.
KC HRW Wheat closed 20¢ to 35¢ higher through May ‘24, and then 4¢ to 7¢ higher, supported by the WASDE.
U.S. wheat supplies were forecast lower than last year with smaller beginning stocks and only slightly larger production. All wheat production was projected at 1,659 million bushels, up modestly from last year on increased harvested area. All wheat yield was projected at 44.7 bushels per acre, which would be 1.8 bushels lower than last year.
Ending stocks were projected 11% lower than last year and the lowest in 16 years. The projected 2023/24 season-average farm price was $8.00 per bushel, down 85¢ from last year’s record.
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Major U.S. financial indices closed little changed but lower Friday, with continued concerns about regional bank health and overall economic growth.
The Dow Jones Industrial Average closed 8 points lower. The S&P 500 closed 6 points lower. The NASDAQ was down 43 points.
West Texas Intermediate Crude Oil futures (CME) closed 83¢ to 88¢ lower through the front six contracts.