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The Cattle Range Weekly Market Summary provides market data for the informed cattleman. Current industry news & commentary as well as a comprehensive comparison of the past week's prices from around the country in comparison to the previous week, month, 6 months ago, 1 year ago, & 5 year average.  The data is compiled from a variety of sources and is organized to provide insight in determining market movement and trends.
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SAMPLE... Market Summary for the week ending May 3rd...
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  • Bullish: The Choice Cutout reached a new all-time record on Friday closing at $201.68.
  • Bearish: Cattle futures dropped due to fear of consumer resistance and talk that wholesale prices have lost their upward momentum.
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The Cattle Range 10-Day Market Trend:
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An indicator of overall cattle market strength.
The angle indicates direction & velocity of the trend.
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The Trendline is based on daily market factors for the past 10 days.
The daily factors are weighted calculations of the cumulative Gain/(Loss)
of 10 major market factors compared to the previous trading day.
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National Feeder & Stocker Cattle Weekly Summary:
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RECEIPTS:        Auctions     Direct    Video/Internet     Total
This Week         193,500     67,900        27,900        289,300 
Last Week         195,200     50,700        62,100        308,000 
Last Year          168,400     25,500        25,500        219,400
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Compared to last week’s closing market, feeder cattle sold steady to 2.00 higher with much less volatility than in recent weeks.  Stocker cattle and calves traded mostly steady to 3.00 higher with many areas of the Southeast as much as 10.00 higher in instances, especially on lightweights under 500 lbs.  Many early-week auction markets reported trends even higher than this, but they were merely catching-up with last week’s sharp gains experienced after Tuesday.  Demand continued good to start this week’s trading session with favorable weather conditions promoting pasture growth and Corn Belt farmers getting started on this year’s late corn planting. 

However, the early-week sunshine soon seemed like the shortest summer ever as yet another cold front moved across the country’s mid-section on Wednesday.  Cold wind and rain fell south of Interstate 70 while the Northern Plains received snow and blizzard conditions on the first day of May with measurements up to and surpassing one foot deep.  The onset of the storm’s approach did not hamper feeder cattle demand as much as the recent spring storms as backgrounders and feeders have found that recovery is fairly quick this time of year.  Plus, auction receipts are dwindling at a fast pace and buyers realize they need to fill orders now while there are still cattle available. 

For the balance of the spring, many producers will be concentrated on getting their corn and soybeans in the ground while most available supplies of calves and yearlings will be turned-out on grass until the Summer Yearling Specials.  The winter of 2012-2013 will simply not give up with snowplows needed to clear baseball fields and temperatures keeping folks from enjoying their typical spring activities.  Backyard grilling is one right of spring that is lacking and beef movement continues sluggish, however the Choice boxed beef cut-out value is near an all-time record high over 200.00. 

Fed cattle trading broke an all-time record with Northern Plains live sales reported in Nebraska on Wednesday from 130.00-131.00 which surpassed the previous record of 130.50 reported in March of 2012.  Southern Plains sales were from 128.00-129.00 with both regions trending steady to 1.00 higher, but the benchmark break was bitter-sweet as most pens are still posting losses.  Some packers were reportedly caught short-bought as they prepare for what they hope will be a banner Memorial Weekend to unofficially start the summer.  This week’s reported auction volume included 60 percent over 600 lbs and 44 percent heifers.

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Stocker Steers:
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Feeder Steers:
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Five Year Moving Average - Stocker & Feeder Steers:
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Cattle Futures:
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Cattle futures reportedly set back early Friday morning as bulls took profits on recent gains, then accelerated downward in reaction to talk that wholesale prices have lost their upward momentum. Many traders may also think the ongoing surge will end in the near future, with cash and wholesale prices declining sharply soon thereafter. June cattle plunged 1.82 cents to end the week at 121.82 cents/pound, while December lost 1.57 cents to 126.90. August feeder cattle futures plummeted 2.15 cents to 147.50 cents/pound, while November skidded 2.15 cents to 152.12.
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Representative Sales of Cow & Pairs:
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  • Woodward, OK
    • Bred Cows:  Medium and Large 1-2  4-6 yrs 1125-1250 5-8 months bred 1100.00-1400.00 per head; 5-7 yrs old 1050-1250 lbs 2-4 months bred 950.00-975.00 per head. 
    • Pairs:  Medium and Large 1-2  2-6 yrs 850-1175 lbs w/75-250 lb calves 1510.00-1725.00 per pair; 7-10 yrs old 1150-1300 lbs w/125-225 lb calves 1300.00-1510.00 per pair. 
  • Oklahoma City, OK
    • Bred Cows:  Medium and Large 1-2  3-5 yrs old 1150-1300 lbs 6-7 months bred 1175.00-1300.00; 4-6 yrs old 900-1050 lbs 3-7 months bred 900.00-1075.00. 
    • Pairs:  Medium and Large 1-2  7 yrs old 1350 lbs w/350 lb calves 1500.00. 
  • El Reno, OK
    • Bred Cows:  Medium and Large 1-2  1-5 yr old 900-1200 lbs 6-8 months bred hi quality 1150.00-1400.00 per head; 6-8 yr old 925-1400 lbs 6-8 months bred 1075.00-1210.00 per head; 10 yr old 1200-1250 lbs 7 months bred 985.00-1000.00 per head. 
    • Pairs:  Medium and Large 1-2  2-5 yr old 950-1275 lbs w/100-225 lb calves 1785.00-1900.00; 4-5 yr old 1100-1300 lbs w/50-150 lb calves 1450.00-1500.00.
  • Joplin, MO
    • Bred Cows:  Medium and Large 1-2  2 yrs to short and solid mouth 2nd and 3rd stage 995-1350 lbs most 1050.00-1250.00, black indiv. 3rd stage 1350.00, 1st stage couple 1040-1125 lbs 950.00-985.00; short and solid mouth to aged 2nd and 3rd stage 1085-1325 lbs 870.00-1050.00. Large 1-2  5 yrs to short and solid mouth 2nd and 3rd stage 1430-1535 lbs 1085.00-1195.00. Medium and Large 2  2-6 yrs 2nd and 3rd stage 1070-1295 lbs 975.00-1050.00, 1st stage 985 lb indiv. 750.00. Medium 1-2  5-6 yrs 2nd and 3rd stage 1020-1050 lbs 900.00-1050.00 per head.
  • Springfield, MO
    • Bred Cows:  Medium and Large 1-2  3-7 yrs 2nd and 3rd stage 1165-1350 lbs 1055.00-1160.00, 1st stage 1052 lb pkg. from a dispersal 1200.00. Large 1-2  6-7 yrs 3rd stage couple 1430-1460 lbs 1160.00-1250.00. Medium and Large 2  5-7 yrs 2nd and 3rd stage 895-1240 lbs 910.00-1060.00, 1st stage 925 lb indiv. 710.00. Medium 1-2  4-6 yrs 1st and 2nd stage 805-910 lbs 740.00-840.00 per head. 
    • Pairs:  Medium and Large 1-2  4-7 yrs 1065-1100 lb cows w/babies to 270 lb calves 1575.00-1585.00; short and solid mouth 1085 lb cow w/150 lb calf 1200.00. Medium 1-2  4-6 yrs 900-1020 lb cows w/babies to 135 lb calves 1560.00-1650.00; broken mouth 925-970 lb cows w/155-235 lb calves 950.00-975.00 per pair.
  • West Plains, MO
    • Bred Cows:  Medium and Large 1-2  few 3-7 yrs 980-1300 lbs 2nd and 3rd stage 1150.00-1275.00 per head, small pkg 2 yr old fancy blk 1180 lbs 3rd stage 1600.00, couple pkgs 3-7 yrs 1100-1135 lbs 1st stage 1025.00-1125.00.  Others 5 yrs to short-solid mouth 1000-1300 lbs 1st thru 3rd stage 80.00-93.00 per cwt, few 4-5 yrs 975-1180 lbs 2nd and 3rd stage 95.00-102.50, indiv 1100 lbs 106.00.  Large 1-2  5-6 yrs 1365-1440 lbs 2nd and 3rd stage 77.50-85.00, indiv 6 yrs 1555 lbs fleshy 3rd stage 76.00. 
    • Pairs:  Medium and Large 1-2  Very scarce, few scattered sales 2 yrs to short-solid 725-1150 lbs few bred back with babies to 350 lb calves 1250.00-1500.00 per pair.
  • Kearney, N
    • Bred Cows: Medium and Large 1: 3rd trimester: Solid mouth 1265 lbs 230.00. Short solid 1340 lbs 985.00. Broken Mouth 1290 lbs 68.50 cwt.  Fall Calving Aug 15th 3-4 yrs 1020-1120 lbs 1100.00-1310.00. 
    • Pairs: Medium and Large 1: Heifers 1190-1245 lbs with 150-235 lbs calves 1900.00. 3-4 yrs 1300-1390 lbs with 150-170 lbs calves 1900.00. Solid mouth 1645 lbs with 240 lbs calves 1700.00. Short solid 1730 lbs with 245 lbs calves 1525.00.
  • Valentine, NE
    • Bred Cows: Medium and Large 1: Young 1188-1289 lbs $1210.00-$1500.00.  Middle aged 1275-1429 lbs $1375.00-$1400.00. Short/Solid 1435-1552 lbs $1060.00-$1140.00.  Broken Mouth 1411-1528 lbs $1000.00-$1100.00.  Mixed Ages Late Bred 1065-1323 lbs $880.00-$1375.00.  Fall Bred 1203-1375 lbs $800.00-$1200.00. 
    • Pairs: Medium and Large 1: Young 988-1350 lbs with new-100 lbs calves $1350.00-$1740.00. Middle aged 1501-1577 lbs with 150-195 lbs calves $1350.00-$1460.00.  Short/Solid 1305-1524 lbs with 150-175 lb calves $985.00-$1310.00.  Broken Mouth 1293-1615 lbs with 155-195 lbs calves $1020.00-$1185.00.
  • Riverton, WY
    • Bred Cows:  Medium-Large 1 Heifers individual 1225 lbs 1325.00, few 860-1170 lbs 925.00-1125.00; Young package 1240 lbs 1285.00, several 1010-1355 lbs 1000.00-1225.00; Middle Aged (Short Solids) 1115-1545 lbs 825.00-1100.00; Aged (Short Term) 1335-1495 lbs 875.00-1075.00 all per head. 
    • Pairs: Medium-Large 1 Heifers 855-1055 lb heifers with 70-140 lb calves 1600.00-1650.00; Young few 935-1260 lb cows with 75-90 lb calves 1500.00-1550.00, few 985-1110 lb cows with 80-110 lb calves 1025.00-1350.00; Middle Aged (Short Solid) individual 1165 lb cow with 120 lb calf 1200.00; Aged (Short Term) few 1110-1360 lb cows with 135-250 lb calves 1100.00-1225.00, individual 1185 lb cow with 50 lb calf 750.00 all per head.
  • Clovis, NM
    • Bred Cows:  Medium and Large 1-2: young 3-5 yr old 1065-1625 lb cows 6-8 months bred 1075.00-1125.00, per head, 3-5 yr old 1050-1280 lb cows 3-6 months bred 900.00-1010.00, per head; middle aged long solid 1020-1250 lb cows 3-8 months bred 825.00-925.00, per head; middle aged short solid indiv 1435 lb cow 6-8 months bred 1035.00, per head.  First Calf Heifers indiv 800 lbs 6-8 months bred 800.00, per head. 
    • Pairs:  Medium and Large 1-2: young 825-1050 lb cows w/150-200 lb calves 1175.00-1360.00, per pair.  First Calf Heifers 700-725 lbs w/75-150 lb calves 900.00-1135.00, per pair.
  • Roswell, NM
    • Bred Cows:  Medium and Large 1-2: young 725-1173 lb cows 3-8 months bred 700.00-1050.00, per head; middle aged 865-1165 lb cows 3-8 months bred 600.00-925.00, per head; aged 810-1090 lb cows 6-8 months bred 600.00-680.00, per head.  First Calf Heifers: pkg to 850 lbs 6-8 months bred 785.00, per head. 
    • Pairs: Medium and Large 1-2: young 715-1175 lb cows w/100-350 lb calves 800.00-1250.00, per pair; middle aged 850-1025 lb cows w/150-400 lb calves 960.00-1160.00, per pair.  First Calf Heifers: 675-715 lbs w/90-130 lb calves 910.00-1025.00, per pair. 
  • Arkansas
    • Medium and Large 1-2  2-3 year old 650-900 lbs heiferettes 105.00-115.00; 3-7 year old 850-1250 lbs 3-9 months bred 1125.00-1225.00/hd; 8-10 year old 3-9 months bred 875.00-975.00/hd. 
    • Pairs:  Medium and Large 1-2  3-7 year old 800-1200 lbs w/100-200 lb calves 1350.00-1450.00/pair, w/200-300 lb calves 1500.00-1600.00/pair few to 1995.00/pair.

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Canadian Packer Bids Strengthen:
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The Canfax average steer and heifer price closed the week at $118.00/cwt and $117.00/cwt respectively, up $2.75-4.00/cwt from the previous week. Packer competition was evident and bids strengthened over the course of the week. Two-tier pricing was evident with premium being paid for long fed cattle verses greener calves. Accumulated sale volumes totaled 9,200. The Alberta fed cash to futures basis strengthened to close at -12.04. Canadian fed exports to the US for the week ending April 13th totaled 11,336 head.

The Canfax average steer price closed the week $0.22 lower while heifers eased $0.14. Stockers and feeders less than 700 lbs traded $0.50-1.50/cwt lower last week and feeders over 700 lbs trended $1.00 higher. The Western Canadian calf index closed at $144.17/cwt, down $1.54. Alberta auction volumes totaled 21,400. Canadian feeder exports to the US for the week ending April 13th totaled 10,291 head.

An increase in calving culls pressured prices last week. D1, D2 cows traded $1.75 lower with live trade reported from $73.00-86.00/cwt. Last week D3 cows averaged $70.00/cwt. Rail bids were reported fully steady. Butcher bulls averaged $88.45/cwt, down $1.15 from the previous week and live trade was reported from $79.00-97.00/cwt. Canadian non-fed exports to the US for the week ending April 13th totaled 7,874 head.

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Canadian Cattle Prices:
Prices have been converted to U.S. $/CWT.  Grades changed to approximate U.S. equivalents
Exchange Rate: Canadian dollar equivalent to $ 0.9920 U.S. dollars
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Prices for the week ending April 26th:
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Seasonal Price Trends:
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It will be no small surprise to market veterans that fluctuations in cattle prices have a seasonal trending nature. The highs for the year are frequently posted in April and the market generally declines into the summer. It also was not surprising to see a forecasting group associated with the national association assert that the spring highs are in this past week and the market will likely move toward summer lows of $118 soon.

This has been a year in which the market defies expectations. April live cattle futures traded in the high $130s in early January. Forecasters accurately observed that supplies of cattle in the first half of the year would decline and they surmised beef prices would skyrocket. Feedlots made purchases requiring a $140 breakeven.

Skyhigh prices never came and losses in the feeding sector continued unabated. The market also defied the speculators who placed bets on $137 April futures contracts. The market for its part has been relatively stable trading in a range between $123-128 for months on end while futures prices trade at extremes on either side of the range. 

June live cattle are currently trading just short of $122. This is $6 short of the market lows called for by the forecasters but it is also $6 shy of the current cash prices. $128 and $130 in the north have served as a market barrier for a major advance in price. $200 in the box cut out has also tended to provide a ceiling to price advances. 

This might be a year for a contra seasonal move in the cash cattle and boxed beef cutout markets. Cold weather has hampered beef demand and weather forecasters are finally calling for a warm up across the north and northeast. If beef demand kicks in for springtime, cattle supplies will fall short of demand -- setting the stage for improving prices at a time when usual expectations are for lower prices. Additionally the cow slaughter that has been exceeding prior year may fall to well under last year's numbers adding additional support to the end meats. 

Sellers also will feel emboldened by their leverage demonstrated in negotiations last week. First bids do not require acceptance. Packers need cattle to slaughter not futures. Packers will talk a lot about $123 June futures following the expiration of the April live cattle contract but it is not unusual for cattle to trade $4-5 premium to the June board in May. 

Friday's cutout reflected some evidence of this move when following the largest weekly slaughter figure in recent weeks at 625,000 cattle, box prices moved higher. If beef demand kicks in then it is possible packers may pull forward on increasing supplies of cattle this summer farther reducing tonnage and adding impetus to price. 

The Cattle Report

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Shootin' the Bull:
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In my opinion, the cattle market got beat up a little more than maybe it deserved Friday.  After most futures contracts set the highest price from contract low on Thursday, traders perceived that the already poor demand was going to get worse.  Most charts viewed have reflected a poor demand situation from domestic to export.  I do not understand how it could get much worse than it already is.  The employment numbers were perceived as friendly.  Equities set new historic highs in some instances and bonds, finally, plummeted.  These are perceived as signs of a healing economy.  So, for what ever reason traders turned negative after a near historic price paid for fats, a historic high in box prices and no apparent detriment from feed costs, I remain friendly towards the cattle.  In my analytical tool box, I've kept watch of a pattern that I liken to falling off a cliff, similar to what fats did today.  My analysis is that it will spend the next couple of days attempting to climb the cliff it created. 

Feeder cattle fared no better.  August moved lower to just under a .618% retracement level.  The trade lower in fats is anticipated to have deflated optimism in the feeders.  It has been an unseasonably slow summer coming.  Grass in some areas has not begun to flourish.  No significant chart damage was done in the feeders.  However, prices need to hold near this area.  As stated last week, pessimism can be at a higher level on wave 2 corrections than at the termination of a move.  It will be interesting to see if the readings are more bearish Monday than when feeders bottomed in the middle of April. 

Corn was able to maintain the majority of gains from Monday and Tuesday.  With weather appearing to improve next week, I would anticipate corn to start moving lower again.  This weeks rally is perceived as another opportunity to make cash sales.  Although December was able to trade out of the down trend channel for a day this week, it closed back into the channel.  Comments are shy this week due to seemingly nothing having changed, yet prices fluctuated adversely to analysis. 

Christopher B. Swift is a commodity broker and branch manager of Rosenthal Collins Group Nashville, TN office. Mr. Swift authors the daily commentaries "mid day cattle comment" and "Shootin' the Bull" found on his website www.shootinthebull.com

An investment in futures contracts is speculative, involves a high degree of risk and is suitable only for persons who can assume the risk of loss in excess of their margin deposits.  You should carefully consider whether futures trading is appropriate for you in light of your investment experience, trading objectives, financial resources and other relevant circumstances. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

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Photo of the Week:
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  • 150 Angus & BWF 2nd-Calf Pairs... Central MT*
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    The Saga of Bart -- Trials & Tribulations of a Cattle Buyer
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    After the party, as Bart and his wife were driving home, she asked, "Honey, have women ever told you how handsome, sexy, and irresistible you are?" 

    Flattered and wanting to appear humble, Bart thoughtfully answered, "No, I guess not."

    With quiet fury, his wife demanded, "Then what in the Hell gave you THAT idea at the party tonight?"

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    Submit a "Bart Joke"  If we use it, you'll receive a $25.00 Gift Certificate to The Cattle Range Mercantile.
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    Out of Kilter:
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    A good way to determine if something is, “going on” in a market is by noticing when market relationships are out of kilter. Cattle and grains typically have a positive correlation. They tend to move in tandem. Moderately increase the price of corn and the cattle will follow suit. The opposite is also true as the cost of feed declines, so does the cost of production. However, when this relationship breaks down, it’s because one market can’t keep pace or pass on the costs of the other. 

    That is what occurred last spring with cattle and corn. The price of feed exceeded the livestock market’s ability to pass on the costs. The trend for the past several months has been a narrowing of last spring's extreme range but has recently begun to widen.

    Normally, the value of 25 bushels of corn is approximately equal to the price per cwt. for feeder steers.

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    5 Year Moving Average:
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    Crude/Cattle Correlation:
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    The chart below shows a fairly consistent correlation between the prices for crude oil and slaughter cattle.  Since it is unlikely the price of cattle affects the price of oil on the world market, it might be assumed the price of crude oil affects the price of cattle, but that is unlikely as well.  It is more likely that economic factors affecting demand for crude oil have a similar effect on demand for beef.

    Accordingly, in the absence of geo/political events disrupting or distorting oil supply, since price trends occur slightly sooner in the crude oil market, it appears that crude oil might be a good indicator of the direction of near-term cattle prices. 

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    3 Year Moving Average:
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    Slaughter Cows & Bulls Average Yielding Prices:
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    Slaughter cows and bulls sold unevenly steady.  USDA's Cutter cow carcass cut-out value Friday morning was 162.20 -- Up 1.40 from last Friday.

    Prices paid for average dressing:

                    %Lean     Weight       Colorado       Oklahoma       Alabama
    Breakers   75-80%     1200-1450    74.50-78.00    77.00-82.50     76.00-78.00
    Boners      80-85%     1050-1250    75.00-79.00    79.00-84.50     79.00-84.00
    Lean         85-90%       950-1200    71.00-74.50    75.50-80.00     71.00-76.00
    Bulls         88-92%     1500-2035     96.00-98.00    98.00-104.00   96.00-100.00

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    Weekly Hay Reports: "Click" on links for detailed report
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    Weekly Feedstuffs Market Review:
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    The USDA Market News Service reports feed ingredient prices for the week ending April 30, were mixed. Soybean Meal was 10.80 to 24.60 higher. Cottonseed Meal was 5.00 lower to 5.00 higher, mostly steady to 5.00 lower.  Whole Cottonseed was 5.00 to 10.00 higher.  Canola Meal was 19.30 to 29.30 higher.  Linseed Meal was 15.00  higher.  Sunflower Meal was steady.  Crude Soybean Oil was 56 to 131 points higher.  Crude Corn Oil was 25 points lower.  Meat and Bone Meal was 15.00 lower to 5.00 higher, mostly steady to 15.00 lower. Blood Meal was 50.00 lower to 35.00 higher, mostly steady to 35.00 lower.  Feather Meal was steady to 30.00 lower.  Fishmeal was steady.  Corn Hominy was steady to 5.00 lower. Corn Gluten Feed was steady to 28.00 lower.  Corn Gluten Meal was steady to 30.00 lower. Distillers Dried Grains were 10.00 lower to 5.00 higher.  Wheat Middlings were 50.00 low4e4r to 5.00 higher, mostly 20.00 to 40.00 lower.
    • Soybean Meal:
      • Offers of high protein Soybean Meal in Central Illinois were 17.60 to 24.60 higher from 452.30-455.30; Iowa was 20.60 to 22.60 higher from 442.30-452.30; Kansas City was 19.60 to 24.60 higher from 448.30-454.30; Minneapolis was 19.60 to 23.60 higher from 438.30-440.30; St. Louis was 31.00 to 36.00 higher from 476.00-501.00; Memphis was 17.30 to 21.30 higher at 475.30; Portland was 16.60 to 20.60 higher from 473.50-493.30; BN Santa Fe delivered Chino Valley was 10.80 to 21.60 higher from 492.50-503.30; Union Pacific delivered Chino Valley was 21.60 higher at 503.30.
    • Cottonseed Meal:
      • Cottonseed Meal FOB the Central San Joaquin Valley in California was steady with offers from 350.00-361.00; Kansas City was 5.00 lower from 345.00-350.00; St. Louis was 5.00 higher from 325.00-340.00; Memphis was steady to 5.00 lower from 305.00-315.00.
    • Whole Cottonseed: 
      • Whole Cottonseed FOB the Central San Joaquin Valley in California was 8.00 to 9.00 higher from 378.00-384.00; delivered to Portland was steady to 5.00 higher from 370.00-379.00; Memphis was 10.00 higher at 285.00.
    • Yellow Corn Hominy:
      • Yellow Corn Hominy in Central Illinois was steady at 200.00; Kansas City (Northwest) was 5.00 lower at 225.00; St. Louis was steady at 238.00; rail delivered California ranged 283.00-290.00.
    • Corn Gluten:
      • Corn Gluten Feed in the Midwest (IA, IL, IN) was 5.00 to 28.00 lower from 152.00-175.00; Kansas City was steady from 210.00-228.00; St. Louis was steady from 175.00-195.00. Corn Gluten Meal, 60 percent protein in the Midwest (IA, IL, IN) was 5.00 to 15.00 lower from 475.00-510.00; Kansas City was steady to 10.00 lower from 570.00-580.00; St. Louis was steady to 10.00 higher from 510.00-535.00; Memphis was 30.00 lower at 520.00.
    • Distillers Dried Grains:
      • Distillers Dried Grain prices in Eastern Corn-belt were 3.00 lower to 5.00 higher from 225.00-245.00; Chicago area was steady from 235.00-240.00; Lawrenceburg, IN was not available; Nebraska was 2.00 to 9.00 lower from 230.00-236.00; Minnesota was steady to 3.00 lower from 220.00-225.00; Kansas was steady to 5.00 lower from 245.00-260.00; Iowa was 8.00 to 10.00 lower from 215.00-235.00; Northern Missouri was steady from 215.00-235.00; St. Louis was steady to 5.00 higher from 240.00-260.00; Wisconsin was 5.00 lower to 3.00 higher from 226.00-245.00; rail delivered California was 3.00 to 5.00 higher with offers from 284.00-287.00.
    • Wheat Middlings:
      • Wheat Middlings in Buffalo, NY was steady to 10.00 lower at 190.00; Kansas City was 30.00 lower from 140.00-150.00; Minneapolis was 20.00 lower from 185.00-195.00; St. Louis 35.00 to 40.00 lower from 170.00-185.00; Memphis was 50.00 lower at 195.00.

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    Est. Weekly Meat Production Under Federal Inspection:
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    Total red meat production under Federal inspection for the week ending Saturday, May 04, 2013 was estimated at 929.8 million lbs. according to the U.S.Department of Agriculture's Marketing Service. This was 1.3 percent lower than a week ago and 0.6 percent higher than a year ago.  Cumulative meat production for the year to date was 1 percent lower compared to the previous year.
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    National Sheep Summary:
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    Compared to last week slaughter lambs were weak to5.00 lower at San Angelo, TX and 40.00-50.00 higher at New Holland, PA. Slaughter ewes were 2.00-5.00 lower, except at New Holland 10.00-20.00 higher.  Feeder lambs were not well tested.  At San Angelo, TX 6121 head sold in a one day sale.  Equity Electronic Auction sold 2400 feeder lambs in Texas.  In direct trading slaughter ewes not tested and feeder lambs were steady, instances 2.00-5.00 higher.  4600 head of negotiated sales of slaughter lambs were 2.00-3.00 higher and 14,100 head of formula sales of dressed lambs under 65 lbs were not well tested; 65-85 lbs were steadyto 3.00 higher; over 85 lbs were 1.00-2.00 lower.  7,880 lamb carcasses sold with 55 lbs and down sharply higher; 55-85 lbs 2.80-8.26 lower and 85 lbs and up 1.10 higher.

    "Click Here" to view this week's prices

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    Bullish/Bearish Consensus:
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    The theory behind the "Bullish/Bearish Consensus" indicator is when the public reaches a consensus, they are usually wrong:
    • They get too bullish after prices have risen, and too bearish after they have already fallen.
    Because of this tendency, there are often extremes in opinion right before major changes in trend:
    • When the public reaches a bullish extreme, i.e., a great majority thinks prices will keep rising, then prices often decline instead. 
    • And when they become too bearish, then prices tend to rise.
    So when Public Opinion moves above the red dotted line in the chart, it means that compared to other readings over the past year, you're seeing a statistically extreme value.  You also want to look at the absolute level of Opinion, too - if it's at 90%, then there's no question we're seeing an historic level of bullish opinion.  Watch for readings above 80% (or especially 90%) to spot those dangerous times when the public is overly enthusiastic about a commodity.

    Conversely, when Public Opinion moves below the green dotted line, then the public is too pessimistic about the commodity's prospects for further gains compared to their opinion over the past year.  Looking for absolute readings under 20% (or especially 10%) often indicates an upturn in the market.

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    Bullish/Bearish Consensus - Cattle
    Last Updated: April 30th
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    Bullish/Bearish Consensus - Corn
    Last Updated: April 30th
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    Inflation:  Not "If" but "When and How Much"
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    The Federal Reserve on Wednesday kept its targeted interest rate and its bond purchase program the same, as the central bank for the first time formally stated that it could increase or decrease bond buying from the current pace "as the outlook for the labor market or inflation changes." Fed Chairman Ben Bernanke had communicated the central bank could adjust the pace at his last press conference, but that wasn't previously part of the statement. Otherwise, there wasn't much new: the Fed said the economy is expanding at a "moderate" pace with inflation running "somewhat below" the desired longer-run objective. In an 11-to-1 vote, the Fed kept its Fed fund target rate between 0% and 0.25%, its program of buying $40 billion per month of mortgage-backed securities and $45 billion of Treasury securities, and its plan to keep rates low at least so long as unemployment is above 6.5%. Kansas City Fed President Esther George again was the sole dissent, on concerns over the risks to future imbalances.

    The Federal Reserve's "targeted interest rate and its bond purchase program" is more commonly known as "Quantitative Easing." Quantitative easing (QE) is an unconventional monetary policy used by central banks to stimulate the national economy when standard monetary policy has become ineffective. A central bank implements quantitative easing by buying financial assets from commercial banks and other private institutions, thus creating money and injecting a pre-determined quantity of money into the economy. This is distinguished from the more usual policy of buying or selling government bonds to change money supply, in order to keep market interest rates at a specified target value.

    Process:
    Ordinarily, a central bank conducts monetary policy by raising or lowering its interest rate target for the inter-bank interest rate. A central bank generally achieves its interest rate target mainly through open market operations, where the central bank buys or sells short-term government bonds from banks and other financial institutions.  When the central bank disburses or collects payment for these bonds, it alters the amount of money in the economy, while simultaneously affecting the price (and thereby the yield) for short-term government bonds. This in turn affects the interbank interest rates.

    If the nominal interest rate is at or very near zero, the central bank cannot lower it further. Such a situation, called a liquidity trap, can occur, for example, during deflation or when inflation is very low.  In such a situation, the central bank may perform quantitative easing by purchasing a pre-determined amount of bonds or other assets from financial institutions without reference to the interest rate.  The goal of this policy is to increase the money supply rather than to decrease the interest rate, which cannot be decreased further. This is often considered a "last resort" to stimulate the economy.

    The U.S. Federal Reserve held between $700 billion and $800 billion of Treasury notes on its balance sheet before the recession. In late November 2008, the Fed started buying $600 billion in Mortgage-backed securities (MBS). By March 2009, it held $1.75 trillion of bank debt, MBS, and Treasury notes, and reached a peak of $2.1 trillion in June 2010. Further purchases were halted as the economy had started to improve, but resumed in August 2010 when the Fed decided the economy was not growing robustly. After the halt in June holdings started falling naturally as debt matured and were projected to fall to $1.7 trillion by 2012. The Fed's revised goal became to keep holdings at the $2.054 trillion level. To maintain that level, the Fed bought $30 billion in 2–10-year Treasury notes a month. In November 2010, the Fed announced a second round of quantitative easing, or "QE2", buying $600 billion of Treasury securities by the end of the second quarter of 2011.  A third round of quantitative easing, or "QE3", was announced by the Federal Reserve in September 2012. The third round includes a plan to purchase US$40 billion of mortgage-backed securities per month. Additionally, the Federal Open Market Committee announced that it would likely maintain the federal funds rate near zero "at least through 2015."

    Economic Impact:
    Quantitative easing may cause higher inflation than desired if the amount of easing required is overestimated, and too much money is created by the purchase of liquid assets.  On the other hand, quantitative easing can fail to be effective at spurring demand if banks remain reluctant to lend money to businesses and households. Even then, quantitative easing can still ease the process of deleveraging as it lowers yields. However, there is a time lag between money growth and inflation, inflationary pressures associated with money growth from QE could build before the central bank acts to counter them.  Inflationary risks are mitigated if the system's economy outgrows the pace of the increase of the money supply from the easing. If production in an economy increases because of the increased money supply, the value of a unit of currency may also increase, even though there is more currency available. For example, if a nation's economy were to spur a significant increase in output at a rate at least as high as the amount of debt monetized, the inflationary pressures would be equalized. This can only happen if member banks actually lend the excess money out instead of hoarding the extra cash. During times of high economic output, the central bank always has the option of restoring the reserves back to higher levels through raising of interest rates or other means, effectively reversing the easing steps taken.

    Reality:
    It is an economic reality that a cause of inflation is increasing the money supply beyond what is needed to keep up with economic growth.  Quantitative easing is a gamble by the Fed that significantly increasing the money supply will stimulate economic growth and and that the growth will be sufficiently robust to absorb the excess money supply, thus avoiding inflation. 

    Since quantitative easing began in 2008, the U.S. economy has averaged less than 1% growth per year.  In that same time period, the Fed increased the money supply more than 300%.

    It is not a question of if there will be inflation -- Instead, it is a question of when and how much?

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    National Economic News:

    U.S. stocks rose this week to end at record highs following solid corporate earnings and better-than-expected job gains in April.  The Dow Jones Industrial Average and the Standard & Poor's 500 Index both rose to record highs, boosted by the jobs report. The Dow rose 142.38 points, or 1%, on Friday to close at 14,973.96. The index was up 1.8% for the week. The S&P 500 gained 16.83 points, or 1.1%, to 1,614.42. It posted weekly gains of 2%. The Nasdaq Composite Index rose by 38.01 points, or 1.1%, to 3,378.63. The index gained 3% for the week. 

    • The Commerce Department reports orders for manufactured goods dropped 4% in March, the biggest drop in seven months and more than the 2.6% decrease economists had expected. 
    • The Institute for Supply Management's gauge of service sector activity fell to 55.0 in April from 56.5 in March, missing expectations of 56.0, and suggesting the sector is expanding at a slower pace.  The Manufacturing PMI gauge fell to 50.7 in April from 51.3 in March, coming in below expectations for 50.9. Readings above 50 point to expansion while those below indicate contraction
    • The Labor Department reports nonfarm payrolls rose by 165,000 in April from March, beating expectations of 145,000. The unemployment rate ticked down to 7.5% from 7.6% for the month, the lowest level since December 2008. Economists expected the rate to hold steady. March’s nonfarm payroll increase was also revised up to 138,000 from a previously reported 88,000. 
    • Construction spending tumbled in March, shedding 1.7% to a seasonally adjusted annual level of $856.7 billion, the Commerce Department said Wednesday. Despite a solid 0.7% advance in residential construction, nonresidential construction on projects like offices and health-care facilities dropped 2.9% on the month. February's growth rate was revised higher to show 1.5% advance instead of a 1.2% gain, but it was at a lower level, reflecting a downward revision to January's levels. Spending in March was 4.8% higher than the same period of 2012.
    • The ADP National Employment Report shows the private sector added 119,000 jobs in April, falling short of estimates of an increase of 150,000 jobs. 
    • The Conference Board's gauge of U.S. consumer confidence jumped to 68.1 in April from 61.9 in March, easily topping economists' estimates of 60.8. 
    • Consumer spending inched up 0.2% in March from February, beating expectations for spending to hold steady for the month. Personal income increased 0.2% on the same basis, falling short of estimates of a 0.4% rise.
    • Pending sales of homes rose 1.5% in March, reversing February's decline, the National Association of Realtors reported Monday. The pending-home-sales index increased to 105.7 in March from 104.1 in February, and was up 7% from March 2012. Home prices in 20 major U.S. metropolitan areas climbed 0.3% in February from January on a non-seasonally adjusted basis, beating expectations of a gain of 0.2%, according to the S&P/Case-Shiller report. Prices rose 9.3% from the same month in 2012, also topping forecasts of a 9% advance. 
    • New claims for unemployment benefits fell to 324,000 last week from an upwardly revised 342,000 the week prior.
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    Planting Corn Late Does Not Foretell Low Yield:
    Iowa State University

    Average recommended planting dates for corn in Iowa lie between April 12 and May 18 in order to achieve 98-100 percent yield potential, but this varies a bit on the specific location. Iowa soil temperatures ranged from approximately 57-63 degrees F. prior to the May 2, 3 cold, rain and snow.

    While those pre-cold-snap temperatures are often considered good for planting corn because 50°F is the temperature necessary for corn seed germination, the weather that hit was not ideal for a corn seed to germinate and begin emergence. 

    Last year, on April 26, Iowa soil temperatures ranged from 58-64°F; however, by April 29 soil temperatures dropped to 49-53°F across the state. This swing in temperatures, coupled with rain at that time, resulted in many reports of lower relative yields for corn planted between April 22-26 than corn planted later. Fluctuations in soil temperatures are related to deformed mesocotyl growth, which can result in “corkscrewed corn” (Nielsen, 2012).

    In a look at historical planting dates and yields, some interesting data appears. Although the trend line of corn planted by May 15 in Iowa is positive, three years were exceptional. In 1982, 1984 and 2008 only 45, 35 and 46 percent of the crop was planted by May 15, respectively; yields were above trend line by 20, 7 and 6 percent respectively. In 1991 and 1995, only 33 and 30 percent of the crop was planted by May 15, respectively. In these two years in which planting proceeded slowly, yields deviated from trend by only -3 percent and -6 percent.

    The relationship between acres planted by May 30 and yield is not strong; this is likely due to the fact that the majority of corn acres are generally planted by the end of May. In 1982, corn was only 71 percent planted by May 30 and yields were above trend line by 20 percent; however, in 1991 and 1995, only 70 and 80 percent of corn was planted and yields were below trend line by -3 percent and -6 percent. [Obviously, 1991 and 1995 were really rough years and really late planted crops.]

    Farmers having planted 1.2 million acres per day in critical windows of recent years, Iowa farmers are now equipped to plant many more acres per day than ever before. Waiting for soil temperatures to rise above 50°F and warmer weather in the forecast is most favorable for corn growth, development and yield (Elmore, 2013). 

    Delaying planting until conditions improve will encourage more uniform and faster emergence, greater emergence percentage and more rapid growth and development. Planting date is only one of many yield factors; weather conditions the rest of the season, management and genetics will likely be more substantial yield factors. 

    While our normal recommendation—based on multiple years and locations of data—is to plant early to maximize yield potential, keep in mind that soil conditions and forecasted weather affect planting recommendations. Early planting does not ensure high yields just as planting late does not foretell low yields.

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    "Click Here" to view a Slide Show of Drought Monitor maps for the past 12 weeks
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    Looking Ahead:
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    • A developing storm over the nation’s mid-section will become cut off from atmospheric steering, causing the system to drift eastward into the Mid-South by week’s end and the Southeast early next week.  Five-day precipitation totals could reach 2 to 4 inches across the east-central Plains, upper Midwest, lower and middle Mississippi Valley, and eastern Gulf Coast region.  In addition, late-season snow will fall from the central Rockies into the Upper Midwest.  In contrast, little or no precipitation will occur in the Northeast and west of the Rockies.  Unusually cool air will trail the storm, resulting in widespread freezes on May 2-3 as far south as the southern High Plains.  Warmth will linger, however, from the eastern Corn Belt into the Northeast. 
    • The NWS 6- to 10-day outlook for May 7-11 calls for above-normal temperatures in the West and Northeast, while cooler-than-normal conditions will prevail across much of the Corn Belt and from the central and southern Plains into the Southeast.  Meanwhile, near- to below-normal precipitation from the Northwest into the northern Plains and western and northern Corn Belt will contrast with wetter-than-normal weather in the central and southern Rockies, portions of the Intermountain West, and much of the eastern third of the nation.
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    Feedyard Closeouts: Profit/(Loss)
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    • Typical closeout for steers sold this week & hedged when placed on feed: ($76.39)
    • Typical closeout for un-hedged steers sold this week: ($135.53)
    • Projected closeout based on the futures & estimated Cost of Gain for steers placed on feed this week: ($46.71)
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    Slaughter Cattle:
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    Friday trading has been mostly inactive on light demand in all major feeding regions. Not enough sales for a market trend. In the Southern Plains on Wednesday live sales sold at 128.00, with a few in Kansas at 129.00. In Nebraska on Wednesday live sales sold from 128.50 to 130.50 and dressed sales on Thursday sold from 206.00 to mostly 207.00. In Colorado on Wednesday live sales sold from 130.00 to 131.00. In the Western Cornbelt on Thursday live sales sold from 128.50 to 130.00 and dressed sales sold from 205.00 to 207.00 mostly at 206.00.
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    Weekly Overview:
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    The average live weight of cattle slaughtered in the Texas Panhandle for the week ending 04-27-2013 was 1230 lbs with 38 percent heifers compared to 1225 lbs and 40 percent heifers the previous week and 1228 lbs and 37 percent heifers the same week a year ago.

    Cattle Slaughter under Federal Inspection:
    Friday   (est)           118,000     Saturday (est)          18,000
    Week ago (est)       117,000     Week ago (est)         19,000
    Year ago (act)        124,000      Year ago (act)          10,000
    Week to date (est)  606,000     Week to date (est)   624,000
    Last Week (est)      606,000     Last Week (est)       625,000
    Last Year (act)       617,000     Last Year (act)         627,000

    Boxed beef cutout values were higher on Choice and weak on Select on moderate demand and light offerings. The Choice cutout reached a new all-time record. It increased $1.10 per cwt from the day before to $201.68 per cwt (versus $192.89 last Friday) while the Select cutout declined $0.51 to $190.13. The Choice-Select price spread was $11.55 per cwt (versus $8.46 last Friday). The reported spot boxed beef trade for the week was 548 loads of fabricated cuts, 15.3% lower than the 647 loads the week before. 

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    National Grain Summary:
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    Grain and soybean bids were mixed.  Soybeans saw solid gains on tight supplies and light farmer selling.  Corn saw support from planting delays as the western corn-belt got hit with snow and rain.

    The robust result of the monthly Employment report sent the equity markets to record highs Friday, which in turn seemed to prompt widespread liquidation of commodity positions as investor concerns about inflation faded. Corn futures seemed to fall victim to that selling in the wake of recent gains. Indeed, profit-taking apparently hit the market despite price-supportive conditions. July corn slipped 0.75 cents to $6.6125/bushel at its Friday afternoon close, while December fell 5.5 cents to $5.535.

    In contrast to the grain losses suffered Friday morning, soybean futures rebounded from their mid-week decline. Bearish traders may have been taking profits on previously established short positions, especially with the old-crop situation remaining very tight. Otherwise, not a great deal had changed from Thursday. July soybean futures closed 15.0 cents higher at $13.8725/bushel Friday, while July soyoil leapt 0.78 cents to 49.27 cents/pound, and July soybean meal inched up $0.3 to $406.5/ton.

    Wheat futures sank Friday in apparent response to the results of the Wheat Quality Council tour of Kansas winter wheat fields concluded Thursday. Their crop estimate, at 313.1 million bushels fell well short of the average forecast stemming from the past five tours (at 341.3 million) and the actual 2012 figure (at 382.2 million). However, the result very likely exceeded earlier expectations, thereby rendering the market vulnerable to a setback. July CBOT wheat futures sank 7.5 cents to $7.21/bushel at its Friday settlement, while July KCBT wheat dove 13.25 cents to $7.78 and July MGE futures declined 5.25 cents to $8.19.

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    Five Year Moving Average - Corn
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