Negotiated cash fed cattle trade remained undeveloped through Thursday afternoon.
Feeder Cattle futures crept mostly higher, while Live Cattle hovered amid sluggish two-sided trading.
Except for 25¢ higher in the front two contracts Live Cattle futures closed an average of 28¢ lower.
Except for 20¢ and 12¢ lower in the front two contracts, Feeder Cattle futures closed an average of 58¢ higher (10¢ to 95¢ higher).
Wholesale beef values were firm to higher on moderate demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.03 higher Thursday afternoon at $215.63/cwt. Select was 54¢ higher at $186.66.
Corn futures closed 12¢ to 14¢ lower through Jul ’20 and then 1¢ to 4¢ lower. Thursday’s World Agricultural Supply and Demand Estimates (see below) were much more production friendly than traders and pre-report estimates expected.
Soybean futures closed fractionally lower through Aug ’20 and then mostly 2¢ to 4¢ lower.
Major U.S. financial indices closed higher again Thursday with continuing hopes of a trade deal with China.
The Dow Jones Industrial Average closed 150 points higher. The S&P 500 closed 18 points higher. The NASDAQ was up 47 points.
USDA increased fed steer price projections for the remainder of this year, in the latest World Agricultural Supply and Demand Estimates (WASDE), based on current price strength. The average 5-Area direct fed steer price for the fourth quarter is forecast at $110/cwt. The annual estimate increased $2 from the previous month’s projection to $115.50.
“Beef production is unchanged for the year, although a slower pace of placements in third-quarter 2019 is expected to result in lower first-quarter beef production, but higher second quarter production,” say analysts with USDA’s Economic Research Service (ERS). Projected fed steer price for the first quarter next year is $120; it’s $117 for the second quarter.
WASDE left anticipated beef production this year virtually unchanged (+5,000 lbs.) at 26.95 billion lbs., based on slower fed cattle slaughter than expected the prior month.
Estimated total red meat and poultry production for this year increased by 164 million lbs. (+0.16%) to 104.77 billion lbs., on higher forecast broiler production.
For next year, USDA projects beef production at 27.67 billion lbs. and total red meat and poultry production at 107.42 billion lbs.
USDA projects alfalfa and alfalfa mixture for hay production at 54.22 million tons, with more acres and slightly higher yield than the previous year, according to the Crop Production report. The total is 1.56 million tons more (+2.92%) than last year. All other hay production is forecast 5.75 million tons more (+7.49%) at 76.71 million tons.
Corn production is forecast at 13.779 billion bu., down 20 million from the previous month’s estimate (4% less than last year), with a decline in harvested area more than offsetting increased forecast yield. As of Oct. 1, the National Agricultural Statistics Service (NASS) estimated corn yield at 168.4 bu./acre, up 0.2 bu. from the previous forecast, but 8 bu. less than last year. According to the Crop Production report, corn area harvested for grain is forecast at 81.8 million acres, down less than 1% from the previous forecast but up slightly from 2018.
WASDE forecasts corn supplies sharply lower from last month on a reduced crop and lower beginning stocks, based on the September 30 Grain Stocks report. Corn ending stocks for 2019-20 were lowered 261 million bu. The season-average corn price received by producers was raised 20¢ to $3.80/bu.
Soybean production for beans is forecast at 3.55 billion bu., down 2% from the previous forecast and down 20% from last year, according to the Crop production report. Based on conditions as of Oct. 1, yields are expected to average 46.9 bu./acre, down 1.0 bu. from the previous forecast and down 3.7 bu. from 2018. Area harvested for beans in the United States is forecast at 75.6 million acres, down less than 1% from the previous forecast and down 14% from 2018.
WASDE projects soybean supplies for 2019-20 at 4.5 billion bu. down 175 million on lower production and beginning stocks. With a small increase in soybean crush, ending stocks are projected at 460 million bushels, down 180 million.
The U.S. season-average soybean price for 2019-20 is forecast at $9.00/bu., up 50¢, reflecting smaller supplies. The soybean meal price is forecast at $325.00/short ton, up $20.00. The soybean oil price forecast is raised 5¢ to 30¢/lb.