Cattle futures surged lower Tuesday beneath the weight of pessimistic outside markets tied to more indicators of persistent inflation.
Feeder Cattle futures closed an average of $5.12 lower.
Live Cattle futures closed an average of $2.42 lower ($1.60 to $2.87 lower).
Corn futures closed mostly 1¢ to 2¢ lower.
KC HRW Wheat closed 3¢ to 6¢ higher.
Soybean futures closed mostly 3¢ to 5¢ lower.
Major U.S. financial indices closed sharply lower Tuesday, pressured by more gains in already-high Treasury yields and a significantly stronger jobs market than anticipated, raising the likelihood of the Fed boosting interest rates. There were 9.6 million job openings Aug. 31, according to the Job Openings and Turnover Summary from the U.S. Department of Labor.
The Dow Jones Industrial Average closed 430 points lower. The S&P 500 closed 58 points lower. The NASDAQ was down 248 points.
West Texas Intermediate Crude Oil futures (CME) closed 1¢ to 41¢ higher through the front six contracts.
Agricultural producer sentiment declined for the second consecutive month in September, according to the Purdue University/CME Group Ag Economy Barometer. The overall index declined 9 points from the previous month to 106. Producers expressed concern about their current situation as well as future prospects for their operations. The Current Conditions and Future Expectations Indices both declined 10 points to a reading of 98 and 109, respectively. All three indices are lower year over year. This month’s Ag Economy Barometer survey was conducted from September 11-15, 2023.
“Weakening prices for major crops and ongoing concerns about high production costs and interest rates weighed on producers’ minds this month,” says James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture.
Producers continue to point to high input costs as a top concern for their farming operations in the year ahead. One-third of respondents in this month’s survey cite it as their number one concern, followed by rising interest rates, and lower crop and/or livestock prices.
Producers remain relatively optimistic about farmland values, which Mintert says is surprising given the percentage of respondents who expressed concerns about high input costs, rising interest rates, and the risk of lower crop and livestock prices. The Short-Term Farmland Value Expectations Index was unchanged at a reading of 126, while the long-term index rose 2 points to 153. Respondents who expect farmland values to rise over the next five years continue to point to non-farm investor demand for farmland along with inflation as the top two reasons for farmland values to continue rising.