Negotiated cash fed cattle trade remained undeveloped through Wednesday afternoon, but early indications were positive.
Choice steers and heifers sold $1.75-$2.00 higher at the fat auction in Tama, IA. There were 192 head of Ch 2-4 steers weighing an average of 1,455 lbs. that brought an average price of $116.28/cwt. That was $2-$3 higher than last week’s country trade in the region.
Likewise, slaughter steers and heifers traded $1-$2 higher at Sioux Falls Regional in South Dakota. There were 348 head of Ch 2-3 steers weighing an average of 1,468 lbs. and bringing an average price of $113.03.
Only 547 head were offered in Wednesday’s weekly Fed Cattle Exchange auction, and no takers. There were two heifer lots from the Southern Plains passed on with bids of $114/cwt. and $113.
Cattle futures softened, though, likely with some defensiveness ahead of the Goldman Roll, when the Goldman Sachs Commodity Index rolls its futures holdings forward from the expiring month.
Live Cattle futures closed an average of 57¢ lower, except for 2¢ higher in near Feb.
Feeder Cattle futures closed an average of $1.03 lower (67¢ to $1.35 lower).
Wholesale beef values were firm on moderate to good demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.09 higher Wednesday afternoon at $237.14/cwt. Select was $1.71 higher at $211.53.
Corn futures closed 2¢ to 4¢ lower through Sep ’20 and then mostly unchanged to fractionally lower.
Soybean futures closed 3¢ to 6¢ lower across most of the board.
Major U.S. financial indices basically hovered in place on Wednesday, with continued strong quarterly corporate earnings tempered by lingering uncertainty about a U.S.-China trade deal.
The Dow Jones Industrial Average closed fractionally lower. The S&P 500 closed 2 points higher. The NASDAQ was down 24 points.
U.S. beef exports in September were steady with last year in volume at 109,799 metric tons (mt), but value was 4% less at $661.3 million, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).
Through the first three quarters of the year, beef exports were 2% below last year’s record pace in both volume (991,325 mt) and value ($6.1 billion).
“While red meat exports face obstacles in some key markets, global demand dynamics are strong and we see opportunities for significant growth in the fourth quarter and into 2020,” says USMEF President and CEO Dan Halstrom. “Progress is being made on market access improvements and this makes for a very positive outlook going forward.”
With that said, lingering trade issues continue to constrain potential. For instance the recently signed U.S.-Japan trade agreement awaits approval, and tariff relief, from the Japanese Parliament. In the meantime, September beef exports to that leading market were 14% below last year in both volume (24,041 mt) and value ($148.3 million).
“Japan is still delivering excellent value for U.S. beef producers, but tariff relief cannot come soon enough,” Halstrom says. “With a level playing field, the U.S. beef industry will move a wider range of products to our loyal customers in Japan and will definitely capitalize on emerging growth opportunities.”
Beef export value per head of fed slaughter averaged $318.54 in September, up significantly from the previous month but 5% below last year. The January-September average was down 3% at $310.77.
U.S. Pork Exports Churn Higher
U.S. pork exports in September increased 13% from a year ago in both volume (202,248 mt) and value ($532.2 million). For January-September, pork export volume was 5% ahead of last year’s pace at 1.9 million mt, while value increased 2% to $4.89 billion.
“Although the U.S. industry has made rebuilding pork demand in Mexico a top priority, there is definitely a lingering effect from the retaliatory duties, which were in place for nearly a full year,” Halstrom explains. “While it is a great relief to once again move pork to Mexico duty-free, ratification of the U.S.-Mexico-Canada Agreement would certainly help the psychology of the market and bolster our major customers’ confidence in the U.S. supply chain.”