Cattle Current—Nov. 5, 2020

Cattle Current—Nov. 5, 2020

Negotiated cash fed cattle prices were $1 higher on a live basis in the Southern Plains Wednesday at $107/cwt., with moderate demand, according to the Agricultural Marketing Service.

That matched the price paid for Southern Plains cattle in the weekly Fed Cattle Exchange auction. Cattle feeders offered 634 head and sold 296 head with delivery of 1-17 days.

Similarly, slaughter steers sold steady to $1 higher in the slaughter auction at Sioux Falls Regional in South Dakota: $105.34 for 281 Choice 2-3 steers weighing an average of 1,454 lbs.; $103.80 for 679 Choice 2-4 steers weighing an average of 1,556 lbs.

Cattle futures closed higher Wednesday, with support from recently stronger wholesale beef values, the brighter seasonal price outlook and the prospect for higher weekly cash trade.

Live Cattle futures closed an average of 72¢ higher, from 5¢ higher in spot Dec to $1.10 higher at the back.

Feeder Cattle futures closed average of $1.40 higher, from 82¢ higher at the back to $1.97 higher toward the front

Choice boxed beef cutout value was 75¢ higher Wednesday afternoon at $210.19/cwt. Select was $1.60 higher at $197.05.

Corn futures closed mostly 2¢ to 5¢ higher.

Soybean futures closed 17¢ to 22¢ higher through Aug ‘21 and then mostly 13¢ higher.

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Major U.S. financial indices continued to rally Wednesday, led by tech stocks and despite the undecided U.S. presidential election.

The Dow Jones Industrial Average closed 367 points higher. The S&P 500 closed 74 points higher. The NASDAQ was up 430 points.

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The International Monetary Fund (IMF) is more optimistic about global economic recovery than it was in June, although improvement is likely to continue on the sluggish side, according to the most recent quarterly World Economic Outlook (WEO).

“We are projecting a somewhat less severe, though still deep recession in 2020, relative to our June forecast,” according to IMF analysts. “The revision is driven by second quarter GDP outturns in large advanced economies, which were not as negative as we had projected; China’s return to growth, which was stronger than expected; and signs of a more rapid recovery in the third quarter. Outturns would have been much weaker if it weren’t for sizable, swift, and unprecedented fiscal, monetary, and regulatory responses that maintained disposable income for households, protected cash flow for firms, and supported credit provision. Collectively these actions have so far prevented a recurrence of the financial catastrophe of 2008-09.”

Currently, IMF projects real global GDP this year to be 4.4% less than last year, when year-to-year GDP grew by 2.8%. Projected GDP for advanced economies this year is -5.8% compared to -3.3% for emerging and developing economies. IMF forecasts U.S. GDP this year at -4.3%.

Looking ahead, IMF projects global GDP at 5.2% next year; 3.0% for advanced economies, 6.0% for emerging economies and 3.1% for the United States.

“After the rebound in 2021, global growth is expected to gradually slow to about 3.5% into the medium term,” say IMF analysts. “This implies only limited progress toward catching up to the path of economic activity for 2020–25 projected before the pandemic for both advanced and emerging market and developing economies. It is also a severe setback to the projected improvement in average living standards across all country groups. The pandemic will reverse the progress made since the 1990s in reducing global poverty and will increase inequality.”

2020-11-04T20:20:07-06:00

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