Agriculture Market Summary: January 2012

Tuesday, January 31, 2012

Agriculture Market Summary Jan. 31, 2012

For the week feeder cattle prices at the Texas locations covered by USDA Market News were mostly steady to $5 higher per hundredweight, with a few to $10 higher. Texas direct feeder sales were steady to $4 higher. Oklahoma City was mostly $2 to $4 higher on feeder cattle, steady to $4 lower on steer calves and $1 to $4, higher on heifer calves. Buyers continue to actively pursue the available cattle, with prices pushed higher on concerns that future supplies will be even tighter. Fed cattle cash prices were $2 lower in light trade after wholesale beef prices declined late in the week, further eroding packer margins. Feedlots are pushing for higher prices to help offset the increasing cost of feeder cattle while packers are trying to pull them lower to get their margins out of negative territory. Last week, the packers won the tug of war.

Cotton prices were lower following weak export sales during the Chinese New Year and little fresh news to support the market. Corn and grain sorghum were higher after another week of strong export sales and continued prospects for lower South American production. Wheat prices followed corn higher, but ample global supplies limited gains. As for futures markets, feeder cattle, fed cattle, wheat and corn were higher, while cotton and lumber were lower. The front-month feeder cattle contract hit new record highs every day last week amid prospects for tighter supplies.

Much of the state recorded rainfall during the week with the heaviest amounts east of a line from Wichita Falls to Abilene to San Antonio and north of I-10. Topsoil moisture was rated in short to very short supply in much of West and South Texas while the remainder of the state was mostly short to adequate. Some areas of surplus moisture were also noted, mostly in the Blacklands region and in East Texas. Winter wheat was 96 percent emerged and in mostly good to poor condition. Preparations for spring planting are underway in many areas. Pastures were rated in mostly poor to very poor condition, though recent rains and warm temperatures have helped winter grasses.

All cash prices above are market averages for locations covered by the USDA Market News program and do not reflect any particular sale at any specific location. Feeder cattle prices are for 500-600 pound medium and large No.1 steers at the Oklahoma City National Stockyards. Futures prices are quoted for the nearest month contract on the last trading day of the week. For additional information, contact TDA at (800) 835-5832 or visit our website, http://www.texasagriculture.gov/.

Tuesday, January 24, 2012

Agriculture Market Summary Jan. 23, 2012

Feeder cattle prices at the Texas locations covered by USDA Market News were mostly steady to $4 higher per hundredweight. Texas direct feeder cattle sales were steady to $2 higher, with a few to $5 higher. Oklahoma City was mostly steady on feeder cattle, steady to $2 lower on steer calves and steady to $2 higher on heifer calves. Buyers continue to actively pursue the available cattle, with prices mostly steady to higher across the region. However, reports also noted that the rate of increase has slowed somewhat. Fed cattle cash prices were $3 higher in spite of lower beef prices and tight packer margins. Cotton prices were higher after China reported its 2011 production was more than 3 million bales less than the current USDA projection and the weekly export sales report showed the highest purchases since November. Corn and grain sorghum were higher after strong weekly export sales reinforced prospects that lower South American production will increase demand for U.S. grain. Wheat prices continued to slide lower as ample global supplies again pressured markets. As for futures markets, feeder cattle, fed cattle, cotton and corn were higher, while wheat and lumber were lower. The January feeder cattle contract hit new record highs early in the week amid prospects for tighter supplies. Light showers were reported in parts of the High Plains and in East Texas, with amounts of an inch or more limited to a few locations in East Texas. Little or no precipitation was recorded in the rest of the state. Topsoil moisture was rated in short to very short supply in much of West and South Texas while the remainder of the state was mostly short to adequate. Some areas of surplus moisture were noted along the Upper Coast. Winter wheat was 95 percent emerged and in mostly good to poor condition. Preparations for spring planting are underway in many areas. Pastures were rated in mostly poor to very poor condition, though recent rains and warm temperatures have helped winter grasses.

Wednesday, January 18, 2012

Agriculture Market Summary Jan. 18, 2012

Feeder cattle prices at the Texas locations covered by USDA Market News were mostly steady to $2 higher per hundredweight, with feeder heifers at Tulia steady to $2 lower. Texas direct feeder cattle sales were steady to $2 higher, while Oklahoma City was $4 to $12 higher in its first sale after the holidays. Buyers continue to actively pursue the available cattle, though prices have leveled-off somewhat following the post-holiday surge. Fed cattle cash prices were $2 higher in spite of lower beef prices and tight packer margins.

Cotton and grain prices declined late in the week in reaction to USDA production and stocks reports, a stronger dollar and ongoing concerns that the European debt crisis could erode demand. On Thursday, cotton cash prices and futures were lower after USDA raised projected ending stocks, mostly due to lower expected exports. Corn and grain sorghum prices were sharply lower, with the underlying nearby corn futures prices down their 40 cent trading limit in reaction to the reports. Traders were expecting a cut in projected ending stocks, but USDA instead raised its 2011 production estimate, left projected U.S. ending stocks unchanged, but raised world stocks. Wheat prices were lower, also because of bearish USDA reports and spillover pressure from other grains. Rice declined after USDA raised projected ending stocks estimates.

As for futures markets, feeder cattle, fed cattle and lumber were higher, while cotton, wheat and corn were lower. The January feeder cattle futures contract hit new record highs on consecutive days last week, and then closed higher again on Monday.

Most of the state east of a line from Corpus Christi to Midland to Childress recorded rainfall during the week with the highest totals reported in Southeast Texas. Topsoil moisture was rated in short to very short supply in much of West and South Texas while the remainder of the state was mostly short to adequate. Some areas of surplus moisture were also noted in locations receiving the most rain last week. Winter wheat was 92 percent emerged and reported in mostly fair to good condition. Cotton harvest was nearing completion on the High Plains. Preparations for spring planting are underway in many areas. Pastures were rated in mostly poor to very poor condition, though recent rains have helped winter grasses.

Tuesday, January 10, 2012

Agriculture Market Recap for Jan. 9, 2012

Feeder cattle prices at the Texas locations covered by USDA Market News were higher compared to pre-holiday sales as buyers caught up with orders and demand remained strong for the tight supply of available cattle. Fed cattle cash prices were nearly $1 lower per hundredweight as negative packer margins and lower beef prices continued to pressure the market. Prices across the cattle sector remain well above where they were at this time last year. Cotton prices were higher on indications that U.S. growers will plant fewer acres in 2012 and on steps taken by Pakistan to support their prices. Cash grain prices declined because of more favorable weather in South America, a stronger dollar and competition from cheaper foreign grain. As for futures markets, feeder cattle, cotton and lumber were higher, while fed cattle, wheat and corn were lower. Rainfall during the week was limited to areas along the Gulf Coast and in parts of Southeast Texas with the rest of the state recording little or no precipitation. Cotton harvest was nearing completion on the High Plains. Winter wheat development was slightly behind normal with 90 percent of the crop emerged compared to 93 percent on average by this date. Wheat was rated in mostly fair to poor condition. Recent rains and warm temperatures have benefited cool-season grasses, but overall, pastures remain in mostly poor to very poor condition.