Usda cattle market reports

Usda cattle market reports

By: Seo12 Date of post: 04.06.2017

There is a major repricing of cattle inventories affecting all classes of cattle. There are no record books for packer margins just as there are none for feedlot profits. Margins vary from plant to plant and depend on cattle purchase costs, labor cost, efficiencies to numerous to mention and marketing prices for the cuts that vary from plant to plant.

There are general methodologies that measure packer margins and some analysts make it their business to post the results. No matter where you check, you will find the current margins up, near or over the all time records and its big money. Futures prices tumbled again on Tuesday morning only to recover on the close in the front months.

All eyes will be on additional cash trades today. The decline in the June futures has been small when compared to the crash in cash prices.

usda cattle market reports

Convergence is upon us. Speculative longs are showing signs of giving up and an exit could continue to impact the highly traded August contract. Volatility in the cattle futures market is a constant reminder of the advice given long ago by Benjamin Graham, a world class investment analyst.

He properly warned wild market participants to avoid: Some of the same people are found today in the cattle futures as in bitcoin, ethereum or other cryptocurrencies. Some might not belong. All those markets share a common characteristic.

They often fail to behave rationally. Carcass weights are released each Thursday and are a closely watched barometer indicating the position of cattle feeders in the nation's feedlots.

usda cattle market reports

The last report released for the week of June 3rd, had steer carcass weights were up 9 at remaining 17 under prior year. Heifers were 14 under last year. Packers focused their efforts on delivery within 30 days and very few trades in the forward months were reported.

Purchases continue to be misreported by USDA as to delivery period and basis status. The errors consist of placing sales in the spot market sales, and reporting flat price forward sales as a Par basis sales. The weekly breakdown of fed cattle moving to the beef processing plants is as follows.

Some of the formula arrangements are week to week negotiated prices and not committed cattle to one plant. This is the first weakness seen in the cutout with more anticipated in the coming weeks. Slaughter levels are ranging between , but need to be higher to clear available supplies.

THE MARKETS

Last week's video auction held feeder prices well above the August board. We are still a long ways away from August but we still may be a long ways from finding a summer bottom in feeder prices. Five Rivers was reported in news stories to plan to continue purchases of feeder cattle pending the sale of the feedyards but the pace may slow.

Offerings to feedyards were increasing yesterday for all delivery periods. Hot weather always has a way of modifying grazing plans across the plains. Purchases are slowed or marketing efforts moved forward. Performance of cattle both on pasture and in the feedyard suffers.

The recent declines in prices also will slow cattle movements both onto pasture and into the feedyards. Prices continued to fall each day as feeder cattle are finding less than robust demand.

Receipts at auctions in Oklahoma will trend downward into the summer months. Feeder futures posted large losses early with a late session recovery holding the losses to just over a dollar. Premiums in the deferred months have disappeared with most traders anticipating more declines if fed cattle prices continue to lose ground. Hedged positions is at the highest level in several years.

This will prevent large equity losses from many stocker operations and the bankers are happy. Feeder Cattle Cash Index. The futures are now leading the cash market lower and the feeder index is following. The only activity in forward contracts was for summer periods. Feedlots were not pushing to buy cattle either forward or current.

Prices were mostly par for August on steers delivered to the Texas Panhandle. The National Weekly Feeder Summary released on Friday of each week tracks the national prices by region for last week. Corn prices were lower in mid week trading. Much of last year's crop is still in the hands of the farmers who are reluctant to sell and prefer awaiting rallies caused from this year's reduced acreage. The basis firmed slightly in recent trading to 50 cents in Guymon, Oklahoma.

JBS Board of Directors has announced plans to sell certain assets in the near future involving Moy Park, one of Europe's top poultry operations, an interest in Vigor, a dairy group and Five Rivers Cattle Company, the world's largest cattle feeding operation. JBS Five Rivers Cattle Feeding LLC Five Rivers is a wholly owned subsidiary of JBS. Five Rivers has a combined feeding capacity of more than , head of cattle with locations in Colorado, Kansas, Oklahoma, Texas, Arizona, and Idaho.

In addition to these locations, Five Rivers on behalf of JBS Food Canada manages a 75, head capacity feedyard in Brooks, Alberta, Canada. Five Rivers will plan to continue purchasing feeder cattle during the interim sale period and cattle from Five Rivers feedyards are expected to continue to be processed at JBS beef plants.

It would be surprising, given the size of the feeding operations, for one buyer to surface. The sale more closely aligns JBS with processing competitors who have divested feeding operations. Kroger cited increased competition and variable food prices as reasons for the declines. They also forecast lower earnings for the coming year. This was only the start of their problems. Amazon has disrupted retailing in our country and brought online purchasing and quick delivery to every household and business.

Amazon delivers both convenience and price efficiencies to the marketplace and the growth has been astronomical. The market viewed the purchase of Whole Foods favorably and the stock price increase Friday caused the increase in the market cap Friday to be equal to the purchase price of Whole Foods -- meaning one might view the purchase as being free.

Amazon is no stranger to the food business having struggled with a food delivery service called Amazon Fresh for several years with a renewed effort this past two years. It poses an irony that the company that upended bricks and mortal retailing is now purchasing bricks and mortar.

Recent moves experimenting with bricks and mortar stores are aimed at both distribution centers and as retail stores. Amazon Book stores have popped up across the country and model grocery stores are being tested for new technologies involving food distribution, inventory and marketing.

Amazon has stated the possibility of new grocery stores allowing the customer to pull items off Smart shelves, place them in Smart baskets and totally eliminate the check out line.

This approach not only brings total inventory control to the grocer but an important check out convenience to the customer saving large costs in the process.

Livestock Market News

There may even be larger disrupter influence of the Amazon purchase of Whole Foods. It may cause a rethinking of the entire process of food distribution. Today almost all major grocers ship to distribution houses where food is aggregated, priced and delivered to the stores. One can see a beef plant where primal cuts are sent to further processing for portion control cuts ready for consumer consumption.

Those cuts could be marketed over the web and delivered to homes, fresh or frozen and ready for consumption. The selection could also include cooked or pre-seasoned offerings designed to match consumer taste. This might revive an ago old practice of daily milk delivery. The path forward in retail marketing of food means more choices and cheaper prices for consumers and all of that is positive for beef producers. Click on the links below to find out all about how Australia plans to use Blockchains and Smart Contracts:.

Australia and Distributed Ledgers. Blockchains and Smart Contracts. Sections of the newsletter are redesigned with hyperlinks to the appropriate source pages.

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The hyperlinks are in light blue within the report. Regional differences in grain and cattle basises create a difficulty in modeling a national composite for current close outs or a proforma forward look at a breakeven. Readers should consider your own area for adjustments to these models.

The Cattle Report introduces the FEEDER METER. The report estimates profit or loss for currently purchased feeder steers and projects a result days out. The chart is interactive and updated every 15 minutes in real time based on changes in futures markets in grain and cattle. Corn basis information is based on current trade prices adjusted every two weeks.

Feeder prices and fed cattle sales are par the appropriate futures contract. The Cattle Report estimates current profit or loss on cattle placed on feed days ago. This report generated from industry averages attempts to simulate a typical close out based on prevailing purchase prices for a feeder steer days ago.

The close out assumes grain was purchased at market each month. Selling prices and interest rates are based on prevailing benchmark quoted prices. This chart will change weekly. Click here to "Check out the markets " Click Here to send your comments. Choice Cutout Choice Price Change Select Cutout Select Price Change

usda cattle market reports
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