Negotiated cash fed cattle trade was mainly steady through late Friday afternoon at $110-$112/cwt. on a live basis and at $174-$175 in the beef. Trade remained undeveloped in the Southern Plains.
Steady cash and surging Lean Hog futures helped cap pressure in Cattle futures.
Other than narrowly mixed through the front four contracts, Live Cattle futures closed an average of 36¢ higher.
Except for 12¢ lower in Jan, Feeder Cattle futures closed an average of 45¢ higher.
Wholesale beef values were steady to weak on light to moderate demand and moderate offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 61¢ lower Friday afternoon at $203.25/cwt. Select was 24¢ lower at $191.74.
Major U.S. financial indices closed sharply lower again Friday, pressured by higher interest rates and fewer jobs than expected in the monthly employment report.
Total non-farm employment increased by 134,000 in September as the nation’s unemployment rate decline 0.2% to 3.7%. Average hourly earnings are 73¢ higher (+28%) over the year to $27.24/hour.
The Dow Jones Industrial Average closed 180 points lower. The S&P 500 closed 16 points lower. The NASDAQ was down 91 points.
The United States-Mexico-Canada Agreement (USMCA) announced last week offers added market certainty, but leaves some tariffs in place.
“Canada and Mexico are the first and third largest export markets for U.S. agriculture, accounting for more than a quarter of all U.S. agriculture exports,” said Dan Kowalski, vice president of CoBank’s Knowledge Exchange Division (KED). “This agreement will advance the ball for some sectors, but for others, the deal represents a return to the status quo. Market access gains will be modest, but we expect the increased certainty to boost domestic and cross-border investment. However, Canada and Mexico still have tariffs in place that affect the U.S. dairy, pork and beef sectors. U.S. agriculture will have much more to celebrate when those barriers are removed.”
A new KED report—From NAFTA to USMCA—breaks down the impacts of the new agreement on U.S. agriculture by sector, and assesses the issues facing those sectors going forward.
“In many respects, the new North American free trade pact will look very similar to the old one,” according to the KED report. “It will lead to significant change in the auto industry, but changes to other industries will be marginal, including agriculture. While modest, the vast majority of impacts to agriculture will be positive. Access to the Canadian dairy and animal protein sectors will improve, and more importantly, the risk of NAFTA being dismantled will be eliminated.
This will clear the way for domestic investment that is dependent on cross-border demand, as well as cross-border investment by firms that are active in two or all three of the markets.
“The modest benefits that U.S. agriculture will gain from USMCA, however, will continue to be overshadowed by the remaining retaliatory tariffs imposed by Mexico and Canada. The impact of Mexico’s tariffs on cheese and pork, and Canada’s tariffs on prepared beef, far outweigh the benefits laid out in USMCA. Therefore, an agreement on steel and aluminum trade, whenever it is struck, will offer much more for U.S. agriculture to celebrate.”