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Grain prices continued to plummet as pressure from both the fundamental and technical sides of the market accumulated. The most obvious factor in this week’s lower prices was the Quarterly Grain Stocks report released on Friday. USDA reported Sept. 1 stocks of corn in the U.S. at 1.128 billion bushels, almost 600 million less than last year at this time, but 164 million more than analysts’ pre-report estimates. That argues that the extraordinarily high prices for corn this summer have started affecting usage, in other words, price rationing is occurring. Adding to the weakness is the continued economic crisis in Europe, which is increasing economic unrest globally. As a result, for the week ended Tuesday, December Corn futures were down more than 64 cents, with the March off 65 and May down nearly as much. That puts December corn futures under six bucks for the first time since July and puts the corn market in an extremely oversold condition.
Soybean prices also took a hard hit, as the November futures contract lost more than 99 cents for the week, while the January contract lost more than a dollar and March was off more than 98 cents. The weakness of the domestic and global economy, the stronger dollar and carryover weakness from corn all contributed to soybeans sharp downturn in price.
Wheat values also dropped sharply this week, for all the same reasons as corn and soybeans. In Chicago, December futures were down more than 54 cents compared to last Tuesday, while the March was down 52. In Kansas City, the December contract was down almost 67 cents for the week, while the March was down more than 66. The ongoing drought in hard red winter wheat country continued to be ignored by the market in favor of weak economies and bearish reports in other grains.
Livestock prices were mixed this week, with Lean Hog futures leading the charge to the high side. October futures were up $4.77 for the week, with the December contract up $3.37. Good export prospects for pork, as well as declining numbers of slaughter-ready hogs both supported the futures market. In Red Oak, cash butchers traded Tuesday at $62, up a dollar compared to last week.
Cash fed cattle had the most impressive gains in the past week, as last Friday feedlot managers were able to force packers to pay $120-121 for fed cattle, up four to five dollars compared to the previous week. However, futures price moves were modest at best, as the October Live Cattle futures were up just 42 cents for the week, while the December gained 90 cents and February lost 75. Boxed beef cutout values were just barely firmer for the week, as Choice was up just 69 cents compared to last Tuesday, while the Select was up $1.66. Those gains looked puny compared to the surge in cash cattle values and served to put the squeeze on packer margins, making it unlikely that there will be another major price gain for cash fed cattle this week.
Feeder Cattle futures failed to respond to the lower grain prices this week, as soft fed cattle futures and poor economics limited the demand for feeder cattle, although some auctions were higher before the sharp losses in feeder futures on Tuesday. For the week, October futures were down 62 cents, with the November off 95 and January down 57 cents.
Next Wednesday morning, Oct. 12, USDA releases the latest Crop Production and Supply and Demand reports, with analysts watching to see if the recent changes in Stocks are transferred to the S & D report. And of course the stock market and global economic conditions will continue to exert pressure on the ag commodities.
Grain prices continued to plummet as pressure from both the fundamental and technical sides of the market accumulated. The most obvious factor in this week’s lower prices was the Quarterly Grain Stocks report released on Friday. USDA reported Sept. 1 stocks of corn in the U.S. at 1.128 billion bushels, almost 600 million less than last year at this time, but 164 million more than analysts’ pre-report estimates. That argues that the extraordinarily high prices for corn this summer have started affecting usage, in other words, price rationing is occurring. Adding to the weakness is the continued economic crisis in Europe, which is increasing economic unrest globally. As a result, for the week ended Tuesday, December Corn futures were down more than 64 cents, with the March off 65 and May down nearly as much. That puts December corn futures under six bucks for the first time since July and puts the corn market in an extremely oversold condition.
Soybean prices also took a hard hit, as the November futures contract lost more than 99 cents for the week, while the January contract lost more than a dollar and March was off more than 98 cents. The weakness of the domestic and global economy, the stronger dollar and carryover weakness from corn all contributed to soybeans sharp downturn in price.
Wheat values also dropped sharply this week, for all the same reasons as corn and soybeans. In Chicago, December futures were down more than 54 cents compared to last Tuesday, while the March was down 52. In Kansas City, the December contract was down almost 67 cents for the week, while the March was down more than 66. The ongoing drought in hard red winter wheat country continued to be ignored by the market in favor of weak economies and bearish reports in other grains.
Livestock prices were mixed this week, with Lean Hog futures leading the charge to the high side. October futures were up $4.77 for the week, with the December contract up $3.37. Good export prospects for pork, as well as declining numbers of slaughter-ready hogs both supported the futures market. In Red Oak, cash butchers traded Tuesday at $62, up a dollar compared to last week.
Cash fed cattle had the most impressive gains in the past week, as last Friday feedlot managers were able to force packers to pay $120-121 for fed cattle, up four to five dollars compared to the previous week. However, futures price moves were modest at best, as the October Live Cattle futures were up just 42 cents for the week, while the December gained 90 cents and February lost 75. Boxed beef cutout values were just barely firmer for the week, as Choice was up just 69 cents compared to last Tuesday, while the Select was up $1.66. Those gains looked puny compared to the surge in cash cattle values and served to put the squeeze on packer margins, making it unlikely that there will be another major price gain for cash fed cattle this week.
Feeder Cattle futures failed to respond to the lower grain prices this week, as soft fed cattle futures and poor economics limited the demand for feeder cattle, although some auctions were higher before the sharp losses in feeder futures on Tuesday. For the week, October futures were down 62 cents, with the November off 95 and January down 57 cents.
Next Wednesday morning, Oct. 12, USDA releases the latest Crop Production and Supply and Demand reports, with analysts watching to see if the recent changes in Stocks are transferred to the S & D report. And of course the stock market and global economic conditions will continue to exert pressure on the ag commodities.
