Cattle futures have plenty of distance to cover before making up the ground lost in the previous two trading sessions, but they made a strong start with Tuesday’s rally as buyers were likely attracted by the extremely oversold conditions.
Feeder Cattle futures closed an average of $7.29 higher, including limit-up $8.25 in spot Jan.
Live Cattle futures closed an average of $3.44 higher ($2.87 to $4.20 higher).
Negotiated cash fed cattle trade ranged from slow on light demand to mostly inactive on light demand through Tuesday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
So far this week, FOB live sales are $2 lower in the Texas Panhandle at $175/cwt.
Last week, FOB live prices were $177 in the Southern Plains, $176 in Nebraska on light trade and $175-$178 in the western Corn Belt. Dressed delivered prices were mostly $280 in Nebraska and $278-$280 in the western Corn Belt.
Choice boxed beef cutout value was 92¢ higher Tuesday afternoon at $298.17/cwt. Select was $1.45 lower at $266.35/cwt.
Soybean futures closed 10¢ to 16¢ higher.
Corn futures closed narrowly mixed, mostly fractionally lower to 1¢ higher.
KC HRW Wheat futures closed mostly 17¢ to 19¢ higher.
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Major U.S. financial indices drifted higher Tuesday on hopes the Fed may be done raising interest rates.
The Dow Jones Industrial Average closed 83 points higher. The S&P 500 closed 4 points higher. The NASDAQ was up 40 points.
West Texas Intermediate Crude Oil futures (CME) closed $1.32 to $1.55 higher through the front six contracts.
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Creighton University’s Rural Mainstreet Index (RMI) sank below growth neutral for the third consecutive month in November to its lowest level in more than three years. It declined 4 points from the previous month to 40.4. It was 49.5 in September.
“This is the weakest recorded reading since June 2020, shortly after the beginning of the pandemic and points to weaker farm and non-farm economies,” says Ernie Goss, the Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.
The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral. The RMI is based on a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
“Higher interest rates, deposit outflows and a slowing farm economy over the past several months continued to constrain the business confidence index to a record low 21.2 from 24.1 in October,” Goss explains. “This month’s reading is the most negative outlook recorded since Creighton began the monthly survey in January 2006.” He adds that approximately 57.7% of bankers expect economic conditions to worsen in the next six months.
Among other highlights…
- For the fifth time in the past six months, farm equipment sales declined.
- Approximately 84.5% of bankers urged the Federal Reserve to make no changes to interest rates at its next meetings in December.
- Approximately 88.5% of bank CEOs reported that available jobs outnumbered available workers in their local economy.