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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 August 15th:
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  • Bullish: Over the last 12 months, domestic beef demand is up 1.6% and export demand for U.S. beef is up 11.5%.
  • Bearish: The recent crash of cattle futures has trickled down to cash prices and interjected caution into the market.
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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 the weighted aggregate totals of the Gain/(Loss) for 10 major market indicators 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     146,300     16,800         32,800        195,900 
Last Week      137,800     62,300        48,000         248,100 
Last Year       156,800     45,900          6,600         209,300
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Compared to last week, feeder cattle and calves traded weak to 5.00 lower with spots 10.00 lower.  Last week’s limit losses on Thursday and Friday in the live and feeder cattle pits spilled over into this week.  Monday’s CME session showed signs of decent gains and footing only to be a dead cat bounce as sharp losses on Tuesday and Wednesday set the tone for the week before firming up on Thursday.  Feeder cattle numbers remain limited as they have all year and demand remains very good for all offerings of feeder cattle with buyers still holding plenty of orders. 

Best demand for lightweight calves under 550 lbs is still very active as in Loup City, NE on Tuesday the market was very optimistic selling 500-535 lb steer calves right off the cow for weighted average price of 291.89.  Yearling cattle still have very good demand as in Bassett, NE on Wednesday sold near 375 head of 1000-1020 lb steers with a weighted average price of 213.21 and 106 head fancy steers weighing 1000 lbs at 223.75.  Many market watchers feel the market has been too top heavy but the market still has a lot of optimism and activity as most markets reported demand very good. 

This week’s USDA grain report had bearish estimates for corn with estimated yield of 167.4 bpa and 14.032 billion bushels both a little less than expected but setting new highs in yield and production.  Fed cattle market is struggling to hold prices near record levels as this week’s trade with live sales mostly 5.00 lower in Kansas at 155.00 with sales in Nebraska from 154.00-155.00.  On Thursday morning a few live sales in western Nebraska traded at 156.00.  Despite showing so much strength only a few weeks ago, there seems to be fears of too high too fast. 

We have also seen hog futures decline sharply as well after hitting a record high in July.  The American consumer has a great variety of competing meats to choose from and is quick to notice when budgets are tight.  With lower boxed beef prices this will hopefully spark retail buying going into Labor Day Weekend.  This week’s auction volume included 50 percent over 600 lbs and 40 percent heifers.

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Stocker Steers:
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Feeder Steers:
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Five Year Moving Average - Stocker Steers, Feeder Steers, & Slaughter Steers:
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Selected Auction Reports:
"Click" on individual auction links for complete report
Oklahoma National Stockyards - Oklahoma City OK...
Actual Receipts:  4391     Last Monday:  5228     Year Ago Monday: 4980
Compared to last week: Feeder steers and heifers weighing under 800 lbs traded mostly 6.00 to 10.00 lower.  Feeder steer and heifers weighing over 800 lbs traded 2.00 to 5.00 lower.  Steer and heifer calves mostly 10.00 to 20.00 lower on a light test.

El Reno Cattle Narrative - El Reno OK
Receipts:  2835    Last Week:  4455    Year Ago:  3663
Compared to last week:  Feeder steers sold 8.00 to 10.00 lower.  Feeder heifers sold mostly 5.00 to 10.00 lower.  Steer and heifer calves were lightly tested but a lower undertone was noted.

Huss Platte Valley Auction - Kearney NE
Receipts:  2482    Two Weeks Ago:  1225    Year Ago:  0
Compared to two weeks ago, steers over 800 lbs sold 10.00 lower. No comparison for light weight steers and heifers.  Demand was good for most offerings even after the CME cattle board closed lower for nearly a week.

Tulia Livestock Auction - Tulia TX
Receipts:  1114    Last Week:  1039    Year Ago: 420
Compared to last week: Feeder steers and heifers mostly 2.00-5.00 lower but instances more particularly on fleshy new crop calves.  However there were limited comparable sales on these new crop calves, since in the past few weeks there have been only small amounts of new crop calves.  There were large spreads between weaned calves and new crop calves which is a normal seasonal trend this time of the year. Slaughter cows mostly steady.

Cattleman's Livestock Auction - Dalhart, TX
Cattle and Calves: 756        Week ago: 712         Year Ago:  1002
Compared to week ago:  Feeder steers and heifers mostly 2.00-4.00 lower in alimited test.  Offerings under 700 lbs were mostly new crop calves with a fewpre-conditioned.  Slaughter cows and bulls steady to 1.00 lower.

Clovis Livestock Auction - Clovis NM
Receipts:  1222           Week Ago: 1234           Year Ago: 528
Compared to last week:  Feeder steers 1.00-5.00 lower except a few 500-550 lbs and 700-750 lbs 2.00 higher.  Heifers under 600 lbs 8.00-10.00 lower, over 600 lbs 1.00 lower.  Buyers more selective for quality and condition than the past sales.  Slaughter cows and bulls unevenly steady.

Toppenish, WA Livestock Auction - Toppenish WA
Receipts:  2800    Last Week:  1300    Year Ago:  1280
Compared to two weeks ago Thursday at same sale, stocker and feeder cattle steady to 9.00 higher. Trade very active with very good demand. Slaughter cows 5.00-6.00 higher. Slaughter bulls 8.00-9.00 higher.

Farmers & Ranchers Livestock Commission Co. - Salina KS
Receipts:  2944    Last Week:  3630    Year Ago:  2542
Compared to last week: Steers 750-1000 lbs 3.00 to 7.00 lower; 750 lbs and under lower undertones noted in a limited supply. Heifers 700-1000 lbs 4.00 to 8.00  lower; 700 lbs and under not enough for a market test, with steady undertones noted.

Sioux Falls Regional Livestock wtd Avg Report - Worthing SD
Receipts:  2352    Two Weeks Ago:  1772    Last Year:  1033
Compared to two weeks ago, This week’s feeder steer offering wereof different weights than last sale therefore complete comparison cannotbe made, 1000-1050 lbs 2.00 to 3.00 lower, other weights saw a lower undertone.  Feeder heifers were best compared on 650-700 lbs which were 3.00to 4.00 lower and 750-800 lbs mostly steady.

Weekly Auction Summaries:
"Click" on individual links for complete report
Tennessee Weekly Auction Summary
Receipts on 10 TN Auctions 6,587 11 Last Week 7,600 10 Last Year 8,500
Trends:  According to the Federal-State Market News Service, comparedto the same sales one week ago, slaughter cows/bulls steady. Steerand bulls under 500 lbs 8.00 to 15.00 lower, over 500 lbs 2.00 to 10.00lower. Heifers 5.00 to 13.00 lower.

Kentucky Weekly Livestock Summary
Receipts  This Week  19,066   Last Week  19,285  Last Year  20,949
Compared to last week, Steer Calves sold mostly steady and Heifer Calves  steady to 2.00 lower with moderate to good demand.  Feeder Steers and Heifers sold mostly steady.  Slaughter Cows and Slaughter Bulls sold steady to 2.00 higher with most gains occurring late in the session.

Mississippi Weekly Livestock Summary
Cattle Receipts:    8,264       Last Week:      8,702       Last Year:   9,559
Compared to last week, slaughter cows sold steady to 4.00 lower and bulls sold 1.00 t0 3.00 higher. Feeder steers and heifers sold steady.

Alabama Auctions Weekly Summary
Alabama livestock auctions for the week ending August 16, 2014.
Total estimated receipts this week 16,200, last week 17,595 and 16,084 last year.
Compared to one week ago: Slaughter cows and bulls sold mostly steady to 1.00 higher. Replacement cows and pairs sold mostly steady. All feeder classes sold 7.00 to 12.00 lower.

Georgia Cattle Auctions Weekly Review
Cattle receipts at 25 markets 11,641 compared to 12,488 last week and 9,744 year ago.
Compared to one week earlier, slaughter cows and bulls steady to 2.00 higher, feeder steers 3.00 to 5.00 lower, bulls 2.00 to 5.00 lower, heifers 2.00 to 6.00 lower, steer calves 3.00 to 5.00 lower, bull calves 3.00 to 6.00 lower, heifer calves 2.00 to 5.00 lower, replacement cows steady to 3.00 higher.

Colorado Auction Feeder Cattle Summary
Receipts: 135        Last Week 1,716        Last Year 2,929
Compared to last week: Not enough comparable sales on feeder steers for a market trend, but a weaker undertone was noted.  No feeder heifers reported.

Colorado Auction Feeder Cattle Summary
Receipts: 1,716        Last Week 3,487        Last Year 6,040
Compared to last week: Not enough comparable sales on feeder steers or heifers for a market trend.

Direct Sales of Feeder & Stocker Cattle:
"Click" on individual links for complete report
AZ-CA-NV Weekly Feeder Cattle Review (Fri)
Confirmed: 4,685 
Compared to last week, Trade and demand moderate.

Colorado Direct Feeder Cattle Report (Fri)
Receipts: 135        Last Week 1,716        Last Year 2,929 
Compared to last week: Not enough comparable sales on feeder steers for a market trend, but a weaker undertone was noted.

Eastern Cornbelt Direct Feeder Cattle Summary (Fri)
Reported sales this week: 0    Last Week: 430    Last year: 267
Compared to last week: Feeder steers not enough comparable sales due to last week light offering but a higher undertone noted.

Georgia Direct Cattle Summary (Fri)
Confirmed sales on 731 head

IA-South MN Direct Feeder Cattle Weekly (Mon)
Receipts:  0    Last Week:  185    Year Ago:  0

Kansas Direct Feeder Cattle Summary (Fri)
Receipts:  2181    Last Week:  2023    Year Ago:  1277
Compared with last week: in a very limited test, steers steady to weak, but did not reflect the major decline in the auctions this week; not enough heifers for a test.

Montana Direct Feeder Cattle Wtd Avg (Fri)
Receipts:  0    Last Week: 0    Year Ago:  0
Compared to last week:  No sales reported on feeder steers or heifers.

New Mexico Feeder Cattle Report (Mon)
No trade reported.

Northwest Wtd Avg Direct Feeder Cattle Report (Fri)
Receipts:  1500    Last Week:  1637    Year Ago:  7310
Compared to last week, feeder cattle weak in a light test due in part to a lower futures market this week.

Oklahoma Direct Feeder Cattle (Fri)
Receipts:  1441    Last Week:  3170    Year Ago:  3023
Compared to last week:  No trend available for feeder steers and heifers due to limited receipts, however a much lower undertone was noted.

South Dakota Direct Feeder Cattle Summary (Fri)
Receipts: 0         Last Week: 0          Last Year: 0 
Compared to last week:  No trades on feeder steers or heifers reported.

WY, Western NE & Western Dakotas Direct Feeder Cattle Wtd Avg (Fri)
Receipts:  247     Week Ago: 9,562   Year Ago: 3,093
Not enough comparable sales for a market trend. However, a lower undertone was noted.

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Cattle Futures:
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Cattle futures posted a late surge. Cattle futures bounced from early-week losses Thursday in reaction to news of emerging cash market stability. Deferred futures sustained the bounce Friday and were later joined by the nearby contracts, which likely reflected news of relatively firm southern Plains trading. October live cattle futures bounced 0.40 cents to 147.75 cents/pound in late Friday trading, while December futures advanced 1.25 to 150.90 cents/pound. Meanwhile, September feeder futures leapt 2.05 cents to 215.10 cents/pound and November futures jumped 1.87 to 213.65.
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Representative Sales of Cow & Pairs:
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  • El Reno, OK
    • Bred Cows: Medium and Large 1  2-5 yrs 1150-1500 lbs 2-8 months 2000.00-2500.00.  Medium and Large 1-2  2-10 yrs 950-1500 lbs 3-8 months 1325.00-1725.00. 
    • Pairs:  Medium and Large 1  3-5 yrs 1100-1350 lbs w/200-425 lb calves 3100.00-3650.00.  Medium and Large 1-2  1050-1300 lbs w/75-300 lb calves 1875.00-2500.00.
  • Oklahoma City, OK
    • Bred Cows: Medium and Large 1-2  4-7 yrs 1200-1650 lbs 1850.00-2500.00. 
    • Pairs:  Medium and Large 1-2  2-7 yrs 1000-1250 lbs w/150-250 lb calves 2275.00-2800.00.
  • Woodward, OK
    • Bred Cows:  Medium and Large 1  4-6 yrs 1375 lbs 3-4 months 2375.00.  Medium and Large 1-2  7-10 yrs 1000-1450 lbs 2-8 months 1575.00-1975.00.
  • Joplin, MO
    • Bred Cows:  Medium and Large 1-2  2 yrs to short solid 1000-1350 lbs 2nd-3rd stage 1900.00-2300.00, few blks 2400.00-2600.00, 1st stage 1050-1325 lbs 1850.00-2000.00; broken mouth to aged 3rd stage 1160-1350 lbs 1800.00-2100.00, 2nd stage 1125-1350 lbs 1320.00-1650.00.  Large 1-2  5 yrs to short solid mouth 2nd-3rd stage 1450-1570 lbs 1850.00-2200.00, 1st stage 2-3 yrs 1120-1150 lbs 1600.00-1900.00; broken mouth to aged 3rd stage 1425-1575 lbs 1700.00-2140.00.  Medium and Large 2  4-6 yrs 1st-2nd stage 900-1275 lbs 1300.00-1500.00; broken mouth 2nd-3rd stage 1200-1260 lbs 1500.00-1600.00.  Medium 1-2  5-6 yrs 2nd-3rd stage 870-1025 lbs 1500.00-1550.00. 
    • Pairs:  Medium Large 1-2  4-7 yrs 1100-1225 lbs w/135-400 lb calves 2700.00-2900.00. 
  • Springfield, MO
    • Bred Cows:  Medium and Large 1-2  2-7 yrs 1000-1350 lbs 2nd-3rd stage pkg. blks 2350.00, balance 1700.00-2000.00, 1st stage 4 yrs to short solid 1025-1285 lbs 1700.00-1925.00, pkg. blks 2075.00.  Large 1-2  2-5 yrs 2nd stage 1300-1600 lbs 2000.00-2200.00, broken mouth 2nd-3rd stage 1375-1430 lbs 1625.00-1875.00.  Medium 1-2  2-4 yrs 1st-2nd stage 810-1030 lbs 1650.00-1750.00. 
    • Pairs:  Medium and Large 1-2  7 yrs to broken mouth pkg. 1350 lbs w/150-190 lb calves 2375.00. 
  • West Plains, MO
    • Bred Cows:  Medium and Large 1-2  2 yrs to short solid 980-1350 lbs 1st-3rd stage 1850.00-2550.00.  Medium and Large 2  2 yrs to broken Mouth 885-1285 lbs 1st-2nd stage 1250.00-1850.00. 
    • Pairs:  Medium and Large 1-2  3-7 yrs 1150-1465 lbs w/baby to 200 lb calves 2350.00-2800.00. Medium and Large 2  2 yrs to broken mouth 750-1250 lbs 95-300 lb calves 1850.00-2400.00.
  • Kearny, NE
    • Bred Cows:  Medium and Large 1  Young 1150-1400 lbs 3rd stage 2675.00-2700.00; Solid mouth 1200-1660 lbs 3rd stage 2300.00-2825.00; Aged 1535-1670 lbs 3rd stage 2150.00-2525.00. 
    • Pairs: Medium and Large 1  Solid Mouth 1550-1585 lbs w/225-300 lbs calves 2800.00-2850.00; Aged: 1600 lbs w/250 lbs calves 2500.00.
  • Roswell, NM
    • Bred Cows:  Medium and Large 1-2 Heifers 600-805 lbs 1-8 months bred 1200.00-1600.00. 
    • Pairs: Medium and Large1-2 young 1000 lbs w/300 lb calf 2250.00, aged 700-1010 lbs w/150-170 lb calves 1100.00-1800.00.  Small Frame: Young Longhorn 610-700 lbs w/150-175 lb calves 1000.00-1150.00.  First Calf Heifers: 550-775 lbs w/160-170 lb calves 1650.00-1825.00. 
  • Arkansas
    • Bred Cows:  Medium and Large 1-2  2-7 yrs 850-1250 lbs 2nd-3rd stage 145.00-155.00 cwt, 1750.00-1850.00; first stage/open 123.00-133.00 cwt,  7-10 yrs 800-1200 lbs 2nd-3rd stage 118.00-128.00 cwt, 1675.00-1775.00. 
    • Pairs: Medium and Large 1-2  3-7 yrs 800-1200 lbs w/100-300 lb calves 2175.00-2275.00; few to 2900.00; 7-10 yrs 800-1200 lbs w/100-200 lb calves 1500.00-1600.00. 
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Bred Cows & Heifers in 2nd & 3rd Stages of Pregnancy:
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The average prices above are from USDA market reports which seldom reference breed or quality.
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Canadian Cattle:
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Alberta Beef Producers:  Alberta direct cattle sales Thursday saw no new trade to report. Cash volumes were cleaned up by local buyers while inquiries from the US were limited. Producers were negotiating lift times as cattle could use extra days on feed. Sale volumes are looking moderate this week, business has essentially wrapped up.
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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 $0.9166 U.S. dollars
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Prices for the week ending August 8th:
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From the Ground Up - Unbalanced Infrastructure in the Beef Industry:
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The infrastructure for the beef industry was built in the early seventies when we had 130 million cows in the U.S.. We built the feed yards to accommodate that many calves, and we built the packing houses to handle and harvest that many animals.

Today we’re at 87 million cows, and that’s created an unbalance in the industry’s infrastructure. Bill Mies is a visiting professor in Texas A&M’s Animal Science Department.

“We’re producing the same tonnage of beef that we produced back in the early seventies because of our increased efficiency, changes in our genetics and in our feeding, but we’ve still got the hotel rooms in all of those feed yards that were built in the early seventies that no longer have occupants.”

Mies says a shortage of calves creates fierce competition.

“The feed yards must compete heavily in order to get cattle to put in their feed yards. That keeps the prices at the rancher level very high. The packing industry was the same way. They had to compete, in order to get the cattle from the feed yards to harvest in their houses, and that kept the prices high to the feed yards, and so the whole system was because we had an infrastructure that was built for many more cattle than we actually do have today.”

The packers have begun to downsize.

“They have closed three big plants in the last three years. There’s another one possibly on the horizon. Feed yards are trying to find other things to do in a feed yard besides feed cattle in it. Some of them are growing Holstein heifers for dairies. Others are doing other things, but the feed yards are still at least twenty-five per cent over-built for the number of cattle we’ve got. That’s going to keep competition high for the foreseeable future, and until somebody bites the bullet and starts bull dozing down feed yards, cow/calf people are going to be in a very advantageous position.”

Mies believes the industry’s infrastructure will finally shake itself out.

“I think the packing industry is very close to getting in balance. I think one more plant would probably put them in balance. In the feed yards though, we still have considerable work to do.”

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Short Term Cattle Low Made; Where to From Here?
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Another plus day, technical indicators have turned up and CME Cattle Futures have begun correcting the oversold condition brought on by the huge break experienced the last three weeks. How big was that sell-off? Well most active Oct LC retraced almost half of its lifetime’s $32.40 rally- which began last November. And it did it in 3 weeks. No wonder traders are weary and wary. 

This violent drop has convinced plenty of traders to sell the next futures rally, believing whole heartedly that futures have topped for the year and some even saying topped for the entire bull move. This topping talk becoming more widespread in spite of knowledge that summer placements have been very low and a hole in fed cattle availability seems likely late 4th, early 1st quarter. Oh and in spite of the record discounts cattle futures stubbornly maintain. 

Futures Give It Back, But Not Cash

Futures may have given back almost half of a year’s gain that last 3 weeks but cash prices haven’t even come remotely close. Last November, when Oct LC was at $128, cash fed cattle were also about $128 and the choice cutout was around $200. This week Oct LC traded $144.92, cash averaged $155 and the cutout $256.74.

But one can argue that Oct is portending the cash break that will come because of the increase in fed formula numbers and weights this fall. But how good of a job have futures done in predicting the future of cash cattle and beef prices this year? Not too long ago, June traded down to $135.40 in May. Cash prices never traded below $143. 

Bears Say It’s Over

But bears argue this time is different. Currentness has been and will continue to be lost as we go through the fall. Prices got “too” high fueled by the confluence of a unique set of circumstances never to be seen again. But are these traders applying “old normal” or “new normal” thinking?

Still Overall Short Supply

The Bull of 2014 has been solely driven by demand for a limited supply of feeder cattle, fed cattle and beef. Some may argue we priced beef out to the consumer this summer but there is no evidence of this as of yet. Modern beef production has never been as small as this year. And ground beef demand is especially inelastic and besides the tiny beef cow herd, is the other most single most important aspect of this historic bull. 

Why couldn’t it be just as likely that after such a dramatic rally in cash cattle and boxed prices in June and July, for the cash market to find a level and do some work, reestablishing a value area and inspiring end user willingness to buy out front again. 

You Can’t Supply All of the Packers All of the Time

There may be an increase in formula cattle coming, which will likely keep one of the four major packers out of the market for specific plants at times; however there simply aren’t enough total fed cattle available in all regions of the country for packers to easily acquire their inventory needs. Look at western Nebraska and eastern Colorado this very week for a good example. Cattle are being hauled from the north plains of Texas to northeastern Colorado for slaughter next week. 

Another major packer with a plant in central Nebraska has secured a huge string of cattle out of northwest Iowa for delivery over a 6 week period. And these cattle come right out of the backyard of another big packer. 

And, it’s worth reiterating that packing plant margins have expanded on this break. Expanded. 

Is A Top or a Pause?

Conclusion? Maybe the cash cattle and beef market has topped for the time being, but it seems just as possible that cash prices bottom in the low $150s in September/October before resuming the uptrend as number tighten and demand for middle meats increases. And given how small beef production will be during Nov/Dec/Jan, another run at the highs seems more likely than a major top in this bull market. 

So selling a rally in a deeply discounted and oversold futures market may be just the ticket to catch the rest of the break in the cash market. Or it may be a fine way to get chopped to pieces.

The Beef

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A Rout in the Cattle Futures:
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Picking a top or a bottom in the markets is fool's work. This year's cattle markets are no exception. Repeated calls by analysts of a top have been overridden by new tops. Each sell off has been followed by a higher high. Everyone knows that can't last forever but it is not clear the end is near. Late week action in the futures featuring limit down moves two days in a row was termed irrational by many observers. Other commentators once again called in the top and chartists see the coming week as a continuation of a downward slide.

The establishment of new highs in any commodity tends to make price action chaotic with skeptics fighting the upswing and bulls ignoring the past tops betting on the future. In the beef business, almost all participants have been wrong in some aspect of their market positions. Volatile markets are hard to read and interpret. Frequently new uncharted territory leads to confusion and mixed signals.

It is generally a good proposition following large price swings to detach from the current market moves and look at the fundamentals. We have completed 4 weeks of slaughter rates of close to 575,000 cattle per week and the box prices have stabilized in the $260 area for choice cuts.  This appears to be a balanced level of production and demand for a short national supply of beef. This production level has resulted in cash prices from $160-166 for cash cattle.  The future supplies of cattle will not be increasing. We are not at a temporary point for short supplies of cattle and awaiting larger offering in the next few months. Supplies of fed cattle may increase a small amount in the next month but behind that will be even shorter supplies and July placements will be record low following several months of smaller placements.

The beauty of free markets is everyone is able to weigh in on an opinion of the future market for cattle. There is no such thing as an irrational market. Every day each participant can make a bet on any price the participant thinks is mispriced. Eventually, all the bets on future prices will be judged by the fundamentals of the marketplace -- supply and demand.

Ag Center Cattle Report

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Photo of the Week:
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  • 150 Red Angus Bred Heifers... Southeast SD*
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    Shootin' the Bull:
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    In my opinion, the tide of price movement has turned. No different than the turning of the tide of the ocean, there will be fluctuating waves, but is not anticipated to reach the apex of contract highs for quite some time.  Changes are being felt now from the consumer and their reduction in consumption is not anticipated to change quickly.  Cattle prices remain higher than any other commodity traded and this is a tough place to be by yourself.  The plummeting of energy prices and sharp decline in interest rates this week leaves many wondering what is going on?  I don't know, but I do not recommend ignoring the markets movements.  For feedyards, the aspect of corn never having reached the under $3.50 area to any extent has made recently purchased inventory appear excessively high.  Throw in the sharp decline in December and February futures, and it is perceived to create an environment of "do not bid up for inventory any more."  While this may still take place by some, the majority will be looking well down the road of "what ifs" and not focusing on what has been. 

    This is the most important for the feeder cattle market.  The drastic change in feeding margins is anticipated to pull the rug out from underneath feeder prices. It is anticipated, and in my opinion only, that a significant number of cattle that should have been destined for the feedyard were diverted to either further backgrounding or pasture.  If this anticipated event materializes, it will suggest additional numbers, at significant weights, coming this fall into feedyards.  The feeder cattle charts have taken on a stair step like pattern to the down side.  I anticipate soon a large step lower to take feeders out of the $220.00 to $210.00 range with downside targets measuring to between $200.00 and $190.00 per respective '14 contract months.  I recommend that you do not tarry when making marketing decisions at this point.  If cattle are ready to ship, do not postpone in an attempt to get a higher price the next week.  If a cash forward contract is available to you, and not a terrible discount, then I recommend making that trade.  If none of this is available to you, buy put options to potentially reduce the risk of adverse price fluctuation. Agree, disagree, or indifferent, do not ignore the factors facing feedyards that is your only buyer for feeder class cattle. The incentive to bid up for inventory has been reversed or slowed greatly. 

    Corn reached a 6 week high on Friday.  Regardless of whether corn rallies to any price significant, the halting of it going down is perceived quite disappointing to feedyards. 

    Lastly, there is something transpiring that I do not know what it is or what may materialize from it.  The price action of commodities, equities, interest rates, and to some extent currencies, are not trading in sync as they have historically done.  This week, long term rates fell to their lowest levels of the year.  Money is a commodity and the lack of demand for it suggests a weak economy.  The supply of money is great and the demand is weak.  The perception that hedge funds have leveraged positions of all kinds due to the excess of cheap liquidity suggests the potential for an asset bubble.  I recommend being exceptionally astute of market changes and how they may impact your operation.

    Christopher B. Swift is a commodity broker and consultant with Swift Trading Company in Nashville, TN. Mr. Swift authors the daily commentaries "mid day cattle comment" and "Shootin' the Bull" commentary 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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    The Saga of Bart -- Trials & Tribulations of a Cattle Buyer
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    The farther south Bart drove, the more worried he became.  He sold 1,000 Mexican steers to a feedyard and they insisted he had to be at the border when the cattle were crossed.  His concern was that with all of the recent border violence, combined with his innate ability to be at the wrong spot at the right time for a disaster, it was likely something really bad was going to happen to him. 

    By the time he reached the border town, Bart was as nervous as a deer on a firing range.  With his survival instincts at a fever pitch, he astutely checked into a motel with an adjoining restaurant that was farthermost from the border.  And with a bunker mentality that rivaled Hitler's, Bart vowed that after he had dinner, he was going to seclude himself in his room for the night.  While eating, he struck up a conversation with a guy at the next table. 

    "You ever think about moving to a safer place to live?" Bart asked. 

    The man replied, "A lot of what you see on the news is exaggeration.  It's just not that bad down here.  My wife and I live in a nice neighborhood, our kids go to excellent schools, and we have good jobs." 

    Greatly relieved, Bart asked, "What do you do here?" 

    The guy answered, "I'm the tail gunner on a Budweiser truck."

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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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    Farm & Pasture Land Values:
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    The St. Louis Fed published its quarterly survey of Midwest and Mid-South farmland values Wednesday, stating that farm and pasture land prices had declined during the second quarter. Farmland values slipped marginally from early 2014, but suffered a 3.5% annual drop. Moreover, ranch and pastureland had posted a 7.5% reduction from their fourth-quarter 2013 peak despite soaring cattle and milk prices. 

    Nevertheless, executives with a farmland investment company, as well as professors at the University of Illinois, argue that rental rates for cropland will hold steady or rise modestly in 2014. They cite the strength of the farm economy and robust farmer balance sheets, which lead to vigorous competition for acreage, as the reasons for their positive forecasts. 

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    Beef Products Inc Reopens Plant as 'Pink Slime' Lawsuit Proceeds:
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    Beef Products Inc will reopen a Kansas processing plant on Monday to boost production of "lean finely textured beef," which critics call "pink slime," as wholesale beef prices soar with a shrinking U.S. cattle herd.

    The reopening of the Garden City, Kansas, plant comes more than two years after it was shuttered following a national media controversy about the BPI product.

    The plant will collect raw chunks of meat and fat beef trimmings from a neighboring Tyson Foods slaughterhouse, package them into large bins, and then ship the refrigerated containers to BPI's processing facility in Dakota City, Nebraska, BPI said on Tuesday.

    The company aims to hire 40 to 45 people for the Kansas plant, which had more than 230 employees prior to its closure.

    BPI is the leading maker of the low-fat product made from chunks of beef, including trimmings, and exposed to tiny bursts of ammonium hydroxide to kill E. coli and other dangerous contaminants.

    And until the spring of 2012, the company had four state-of-the art plants, more than 1,300 employees and was expanding aggressively. Few Americans realized the product was a mainstay of fast-food burgers, school lunch tacos and homemade meatloaf.

    But the meat processor shuttered most of its plants and its revenues plummeted that year - a collapse that company officials blame on a series of ABC News broadcasts in 2012 that repeatedly called BPI's product "pink slime."

    The company is embroiled in a sweeping defamation lawsuit in Union County Circuit Court in South Dakota against the network, star anchor Diane Sawyer and other defendants, and is seeking at least $1.2 billion in damages. Attorneys for both BPI and the network have proposed a trial date of February 2017.
    The company is growing again, Craig Letch, BPI's director of food quality & food safety, said in a statement.

    "Although business conditions are not yet at the point where we can resume lean beef production operations in (Kansas), this is certainly a step in the right direction," Letch said.

    The size of the U.S. cattle herd has fallen to its smallest in 63 years after years of drought.

    Cargill Inc, one of the nation's largest beef processors, last month closed a plant in Milwaukee, Wisconsin, due to the scarcity of cattle. The company shuttered a Texas beef plant last year.

    Beef prices have been climbing as the herd shrinks. The retail price for extra lean ground beef in June hit a record high $5.48 per lb, surpassing the previous record of $5.42 in April.

    The case is Beef Products Inc et al v. American Broadcasting Cos et al, First Judicial Circuit Court of South Dakota, Union County, No. 12-292.

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    Margin between the Choice Boxed Beef Cutout & Feeder Steers:
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    5 Year Average: $46.00 --- This Week: $39.76
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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, its because one market can't keep pace or pass on the costs of the other. 

    That is what occurred in the spring of 2012 with cattle and corn. The price of feed exceeded the livestock market's ability to pass on the costs.  Over the 2013 summer months, the gap was erased and corn went "Out of Kilter" last fall.  A correction started in January but ran out of steam in view of surging cattle prices and plummeting corn prices.

    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 price for a barrel of crude oil and the per cwt. price for 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, crude oil has been a good indicator of the direction of near term cattle prices. However, with increased supplies of crude oil and decreased supplies of slaughter cattle, an "Out of Kilter" situation between the two commodities has developed.

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    5 Year Moving Average:
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    U.S. Beef & Pork Exports on Record Pace Through June:
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    U.S. pork and beef exports remained strong in June, pushing export value for both products to a record first-half pace according to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF).
    • Beef exports were up 5 percent in volume (106,609 mt) in June and set a new monthly value record of $631.7 million (+12 percent). First-half export value also set a new record of $3.27 billion (+16 percent). Export volume was 585,953 mt in the first half, up 8 percent from a year ago but trailing the 2011 record.
    • June pork exports totaled 181,531 metric tons (mt), up 7 percent from a year ago, while export value increased 25 percent to $585.1 million. In the first half of 2014, pork export volume (1.15 million mt, +9 percent) and value ($3.4 billion, +17 percent) achieved record highs.
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    Slaughter Cows & Bulls:
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    Slaughter cows steady to 2.00 higher with exception of the western region being Steady to 2.00 lower.  Slaughter bulls mostly steady to 3.00 lower.  Packer demand remains good. 

    USDA's Cutter cow carcass cut-out value Friday morning was 233.68 -- Up 3.15 from last Friday.

                   %Lean       Weight         Wyoming          Oklahoma          Alabama 
    Breakers  75-80%     1100-1600    122.00-125.00   125.00-133.00   107.00-112.00
    Boners     80-85%     1000-1450    120.00-130.00   127.00-132.50   109.00-114.00
    Lean        85-90%     1000-1300   104.00-112.00    119.00-126.00   101.00-106.00
    Bulls        88-92%     1300-2500   142.50-151.00    145.00-153.50   126.00-129.00

    Negotiated Sale of Packer Cows & Bulls:

                       Confirmed  Week Ago  Year Ago  Week to Date  Week Ago  Year Ago
    NATIONAL            6,244        5,666       7,805         31,924      28,918     35,891
    S CENTRAL          1,485        1,498       2,184           7,466        7,299      9,428
    N CENTRAL             343          367          683           1,435        1,977      2,616
    EAST                   2,013       1,693       2,159         11,123        9,160      9,269
    WEST                  1,412         877        1,498           6,484        5,185      7,864
    MIDWEST               991       1,231        1,281          5,416        5,297      6,714

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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 August 12, were mixed.
    • Soybean Meal was 11.00 lower to 26.00 higher. Cottonseed Meal was mixed, 25.00 lower to 7.00 higher, mostly steady.
    • Whole Cottonseed was 75.00 lower to 5.00 higher.
    • Canola Meal was mixed 5.00 lower to 13.20 higher.  Linseed Meal was 5.00 lower in limited trade.  Sunflower Meal was steady to 10.00 lower. 
    • Crude Soybean Oil was 18 to 243 points lower.  Crude Corn Oil was steady.
    • Ruminant Meat and Bone Meal was mixed, 20.00 lower to 10.00 higher, mostly 10.00 to 20.00 lower.  Ruminant Blood Meal was steady.  Feather Meal was steady to 25.00 higher, mostly steady. Menhaden Fishmeal was steady. 
    • Corn Hominy was mixed, 10.00 lower to 5.00 higher. Corn Gluten Feed was steady to 25.00 higher.  Corn Gluten Meal was steady to 30.00 lower. 
    • Distillers Dried Grains were mixed, 15.00 lower to 13.00 higher. 
    • Wheat Middlings were mixed, 10.00 lower to 8.00 higher.

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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, August 16, 2014 was estimated at 899.4 million lbs. according to the U.S.Department of Agriculture's Marketing Service. This was 2.9 percent higher than a week ago and 5.0 percent lower than a year ago.  Cumulative meat production for the year to date was 3.9 percent lower compared to the previous year.
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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: August 12th
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    Bullish/Bearish Consensus - Corn
    Last Updated: August 12th
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    National Economic News:
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    Stocks modestly higher in light trading: Stocks were higher in a week of thin summer trading. The gains helped the Dow Jones Industrial Average move into positive territory for the year, but the Nasdaq Composite saw the strongest increase. The Nasdaq ended the week down only 1% from its recent peak, the smallest margin among the major indexes. The small-cap Russell 2000 Index has fared the worst in recent weeks, falling nearly 7% from its all-time high.

    Corporate earnings season winds down: The major equity indexes drifted higher throughout much of the week, although it was hard to determine the specific factors responsible for the gains. The corporate earnings season came nearer to a close, with only a relatively small number of companies reporting second-quarter results. Still, investors may have continued to celebrate a generally successful pattern of corporate profit gains.

    Retail sales disappoint: The week's flow of economic data was relatively thin, and several figures proved disappointing. Most notably, retail sales growth was flat in July, a setback that economists attribute in part to temporary weakness in hourly earnings. He expects that improvements in employment and earnings in August should result in higher spending, however.

    Consumer sentiment declines: Stalled wages may have also been partly responsible for a decline in consumer sentiment, reported Friday. The Thomson Reuters/University of Michigan preliminary reading on consumer attitudes fell to its lowest level since last November, while its measure of consumer expectations declined for the fourth straight month. Some observers had expected an increase in sentiment, due to recent payroll gains and falling gasoline prices.

    Ukraine worries send stocks lower: It has been difficult to gauge the effect of ongoing international crises on consumers, but the turmoil has had a clear influence on investor sentiment. After signs of conciliation helped drive stock gains last week, the situation in Ukraine appeared to relapse on Friday morning. Stock prices fell sharply as news broke of a confrontation between Ukrainian military forces and a Russian armored convoy that had crossed the border. Russia denied the incident, however.

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    History Lesson in Packing Plant Closures:
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    March 2008, Emporia, Kansas -- a Tyson beef plant ceased a majority of its beef processing operations. February 2013, Plainview, Texas -- Cargill stopped processing beef at one of its facilities. April 2014, Brawley, California -- a beef packing plant operated by the National Beef Packing Co. closed its doors. In just the past two weeks, closing announcements of another Cargill packing plant in Milwaukee, Wisconsin, and L&H Packing Co. in San Antonio, Texas, have come to light.

    These few examples of closures in the last six years reflect a trend in the United States that has gone on for more than a decade, according to Glynn Tonsor, livestock economist for K-State Research and Extension.

    “For more than 12 years we’ve been shrinking the U.S. beef herd, so we need fewer processing plants and feedlots than we used to,” Tonsor said. “Economists call this excess capacity in the industry. Plant-by-plant there may be individual reasons for the closings, but the national-level story of why we are having closures is we simply have more hooks and more processing capacity than we need.”

    Tight cattle supply has driven the closures, which has affected different major packing companies in different areas. Tonsor said location of the plants is part of the issue.

    “The availability of cattle, the proximity to the border to be able to import cattle from Mexico or Canada and the proximity to large dairies if it’s a cow processing facility all come into play,” he said. “But, at the end of the day each plant has to have a local supply relative to its capacity. Some plants are in a better position with that than others.”

    Tonsor said the United States’ beef processing industry is slowly moving north and east compared to what it used to be. He recognizes the Milwaukee plant closure doesn’t fit that trend, but in general, the processing move is consistent with the cattle supply moving north and drying up in the industry’s southwest corner—an area that has experienced severe drought the past few years.

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    "Click Here" to view a Slide Show of Drought Monitor maps for the last 12 weeks
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    Looking Ahead:
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    • August 14 – 18, 2014 is expected to bring a swath of moderate to locally heavy rain (0.5 to 2.5 inches) from the northernmost reaches of the Cascades, Intermountain West, and Rockies southeastward through most of the Dakotas, the upper Mississippi Valley, the southern Great Lakes Region, and the Ohio Valley. Light rainfall is expected for most other regions of dryness and drought, with scattered moderate rains dampening the Rockies. Little if any precipitation is expected in much of Georgia and South Carolina, central and southern Texas, the Great Basin, and the Far West south of the Cascades.
    • The ensuing 5 days (August 19 – 23) favor above-median rainfall from the northern Rockies eastward through the northern Plains, the middle and upper Mississippi Valley, the Great Lakes, the Ohio Valley, the upper South, and the Northeast outside of New England. Below-median precipitation is anticipated for Oregon, Nevada, Utah, the Four Corners States, Texas, and adjacent parts of neighboring states. Elsewhere, neither unusually dry nor wet weather is favored.
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    Cargill Sees Fall in Revenue & Earnings

    US meat and agrifood business Cargill has seen a 19 per cent drop in its annual earnings and a 12 per cent fall in earnings for the fourth quarter of the year.

    The multinational company reported net earnings of $424 million in the fourth quarter ended 31 May, down from $483 million in the same period a year ago.

    However, fourth-quarter revenues rose by two per cent to $36.2 billion.

    For the full fiscal year Cargill earned $1.87 billion, a 19 per cent decrease from $2.31 billion in the prior year.

    Revenues fell by one per cent to $134.9 billion. Cash flow from operations totalled $3.77 billion, down 12 per cent from $4.27 billion in fiscal 2013.

    “Cargill plays an important role in helping to feed a growing world, and that inspires us to continuously improve performance,” said David MacLennan, Cargill’s president and chief executive officer.

    “Though we look back on a year in which overall earnings fell short of expectations, we realised stronger operating results in several businesses including a turnaround in our global beef operations.

    “We also made good progress on moves designed to sharpen efficiency and support profitable growth in fiscal 2015 and beyond.”
     

    National Beef Reports $21.5M Loss

    Leucadia National Corp., a diversified holding company engaged in a variety of businesses, recently noted the impact of tight supplies of cattle on its subsidiary, National Beef Packing, LLC, Kansas City, Mo.

    The company, which reported second-quarter net income of $65.1 million, said the company made progress across many of its businesses. But National Beef has struggled due to tight supplies of cattle. Leucadia acquired an ownership interest of approximately 79 percent in National Beef in 2012.

    "With the US cattle herd at 50-year lows and herd rebuilding in its early stages, margins for National Beef and US packing industry remain challenged, and the company recorded a first-half pre-tax loss of $21.5 million," the company said in a statement. "In response to insufficient cattle supply, National Beef closed its Brawley, Calif. processing facility at the end of May, which caused part of the first half loss, but will contribute to improved results going forward.

    "On positive notes, the expanded tannery is approaching full capacity and management continues to focus on additional value-added opportunities for National Beef consumer-ready beef facilities," the company added. "As a result of these initiatives, we anticipate that National Beef will see improvements in profitability over the next several years."

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    Feedyard Closeouts: Profit/(Loss)
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    • Typical closeout for steers sold this week & hedged when placed on feed: ($66.25)
    • Typical closeout for un-hedged steers sold this week: $238.94
    • Projected closeout based on the futures & estimated Cost of Gain for steers placed on feed this week: ($83.73)
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    Slaughter Cattle:
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    Thursday negotiated cash trade was light on light to moderate demand in Kansas, Nebraska and the Western Cornbelt. Thursday in Kansas, few dressed sales sold at 243.50 with live sales at 155.00 On Wednesday. In Nebraska on Thursday, compared to live sales prior in the week, a few live sales sold 1.00-4.00 higher at 156.00. However live sales for the week have sold 6.00-8.00 lower compared to last week from 152.00-156.00. On Thursday few dressed sales sold steady at 244.00 compared to Wednesday. On Wednesday in the Western Cornbelt, live sales sold at 154.00 with dressed sales from 240.00-243.00 mostly at 240.00. Trade was mostly inactive on light to moderate demand in the Texas Panhandle and Colorado on Thursday. Last week in the Texas Panhandle live sales sold from 158.00-160.00 and from 160.00-160.50 in Colorado.
     
    Livestock Slaughter under Federal Inspection:
                                        CATTLE     CALVES   HOGS           SHEEP
    Friday 08/15/2014       (est)   112,000      2,000     395,000         5,000
    Week ago (est)                      114,000     2,000     345,000         6,000
    Year ago (act)                       117,000      3,000     423,000         7,000
    Week to date (est)                 568,000    10,000   1,992,000      38,000
    Same Period Last Week (est)  568,000    10,000   1,894,000      40,000
    Same Period Last Year (act)   597,000    14,000   2,117,000      42,000

    Saturday 08/16/2014      (est)    9,000         0      25,000               0
    Week ago (est)                         5,000         0      25,000               0
    Year ago (act)                         27,000         0      67,000             1,000
    Week to date (est)                 577,000    10,000   2,017,000       38,000
    Same Period Last Week (est)  573,000    10,000   1,919,000       40,000
    Same Period Last Year* (act) 624,000    14,000   2,185,000        43,000
    2014 Year to Date             18,800,000   375,000  64,938,000  1,327,000
    2013 *Year to Date           20,214,000   464,000  68,293,000  1,324,000
    Percent change                  -7.0%        -19.2%       -4.9%        0.3%

    Negotiated prices paid for Slaughter Steers and Heifers:

    Live basis:              Steers                             Heifers
    Over 80% Choice     152.00-156.00 avg 154.32   151.00-156.00 avg 154.86
    65 - 80% Choice      153.00-156.00 avg 155.92   154.00-156.00 avg 155.78
    35 - 65% Choice      155.00-156.00 avg 155.87   156.00-156.00 avg 156.00
    0 - 35% Choice             -                       - 
    Total all grades    152.00-156.00 avg 155.27   151.00-156.00 avg 155.27

    Dressed basis 
    Over 80% Choice    244.00-244.00 avg 244.00   242.00-247.00 avg 244.05
    65 - 80% Choice     241.00-244.00 avg 242.82   243.50-244.00 avg 243.58
    35 - 65% Choice     243.50-244.00 avg 243.89   243.50-243.50 avg 243.50
    0 - 35% Choice       243.50-243.50 avg 243.50         - 
    Total all grades    241.00-244.00 avg 243.47   242.00-247.00 avg 243.73

     

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    Corn Crop Condition:
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    National Grain Summary:
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    Corn and wheat closed higher while soybeans traded lower.  Wheat received a boost from renewed fight in the Ukraine; while corn received support from wheat there is the thought that acres could be less than expected in some areas.
    • Corn Futures Summary: Corn futures ended the week on a strong note. The annual USDA report on farmer enrollment in subsidy programs was published early Friday morning. They enrolled 83.322 million acres of corn, with 1.54 million classified as ‘prevent planted.’ Nearby futures rose modestly in response, since the indicated acreage totals seemed surprisingly small. Nearby futures topped short-term MA resistance. September corn gained 3.75 cents to $3.6575/bushel at their Friday settlement, while December climbed 3.5 to $3.77.
    • Soybean Futures Summary: The soy complex ended the week in mixed fashion. The early-Friday USDA data stated bean acreage enrolled in subsidy programs at 79.25 million acres, with 827,000 acres deemed as ‘prevent planted.’ As with corn, the total looks low, which supported bean and meal futures. Demand strength also boosted nearby contracts. Meanwhile, the bearish vegoil situation continued weighing on soybean oil futures and appeared to drag deferred beans down as well. September soybean futures closed up 4.25 cents at $11.025/bushel Friday afternoon, while November futures sank 4.0 cents to $10.52. September soyoil dove 0.64 cents to 32.87 cents/pound, but September soymeal marched up $5.9 to $388.3/ton.
    • Wheat Futures Summary: The wheat markets posted a sizeable Friday advance. The USDA-FSA report stated enrolled U.S. wheat acreage at 52.57 million acres, with 1.36 million defined as ‘prevent planted.’ Again, the participation rate seemed low. That supported futures, but talk of fresh rainfall over Europe, and concerns about the Black Sea situation seemed to power the advance. September CBOT wheat surged 14.0 cents to $5.5125/bushel at Friday’s close, while September KC wheat advanced 11.75 cents to $6.1975/bushel, and September MWE wheat moved up 6.25 to $6.12.
    USDA Foresee a Record Harvest

    Cool, ideal summer weather set high expectations for the country’s corn crop, and the USDA’s latest World Agricultural Supply and Demand Estimates report shows just how much the crop benefited.

    In Tuesday’s report, the USDA forecast 2014-2015 corn production 172 million bushels higher than last month’s report at a record 14.03 billion bushels.

    “The first survey-based corn yield forecast, at a record 167.4 bushels per acre, is up 2.1 bushels from last month’s trend-based projection,” the USDA wrote.

    The report also projected:

    • Record corn supplies for 2014-2015 at 15.24 billion bushels, with an increase in production partly offset by a 65-million-bushel reduction in beginning stocks;
    • An increase in corn use for ethanol and exports by 45 million bushels and 20 million bushels, respectively, for 2013-2014;
    • Slightly higher ending stocks for 2014-2015;
    • Lower season-average farm price, which is expected to range between $3.55 and $4.25 per bushel.
    For soybeans, the USDA forecasts production to top 3.8 billion bushel due to a higher yield, which is projected at a record 45.4 bushels per acre. The season-average soybean price is expected to range between $9.35 and $11.35 per bushel, down 15 cents on both ends of the range.

    The USDA sees reduced soybean imports and increased exports for 2013-2014.

    “Imports are lowered 5 million bushels to 80 million based in part on revised import data for September – December 2013 from the U.S. Department of Commerce,” the USDA wrote. “Exports are raised 20 million bushels to 1,640 million reflecting both revised export data for September through December 2013 from the Department of Commerce and inspections data for July 2014. These changes are offset with lower residual use, leaving ending stocks unchanged at 140 million bushels.”

    "Click Here" for the full report.

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    Five Year Moving Average - Corn & Wheat
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