** AgResource Daily Cattle Analysis: Cattle futures were lower at the close on Tuesday, and a steady/weaker outlook is offered for early trading this morning. The turn in beef prices and expectation for lower cash business cattle under pressure through Tuesday, which could continue ahead of the holiday weekend.
Cash cattle markets have so far been very quiet this week, with no bids or offers quoted through Tuesday though the general market tone is lower for this week as beef prices correct. Initial trade at the Fed Cattle Exchange is expected later this morning with 2,684 head consigned.
Beef cutout values were mixed Tuesday morning and both values were lower in the afternoon. The choice cutout value was down $2.14 at $245.74 and select was off $1.66 at $221.17 on light to moderate demand and offerings.
The May Cattle on Feed report will be released at 11 AM (CT) on Friday morning due to the holiday weekend. The CME livestock markets do not close early, which means cattle and feeder cattle futures will be trading at the report release. Ahead of the report, the average trade estimate calls for an April feeder cattle placement rate at 107% of last year, a marketing rate of 102%, with May 1st cattle on feed supplies expected at 101%. If realized, this would be the largest April placement figure since 2003, and May on feed would be the largest in 5 years.
The cash market is expected to trend lower in coming weeks, but the record basis is expected to offer support to June cattle on breaks. Cattle are shifting to range trade.
** US Weather Pattern Discussion: The US and EU weather models are in only fair agreement with the European model forecast being much wetter across the Plains and the W Midwest next week. All forecast solutions are cool with any spate of warming being rather brief during the coming weekend.
In the extended range, the forecast models return wet weather conditions to the Plains, Midwest and Delta. This remains an active weather pattern for areas that are south of the Northern Plains. It’s the clouds, wetness and cold that is causing Central US corn and soybean crops to be ragged/yellow with a need existing for warm/dry weather conditions in coming weeks. Limited planting progress will be scored this week with just 89-90% of the US corn crop seeded with soybean seeding reaching 63-65%. This means that early June weather is key to getting the rest of the seed in the ground.
The attached graphic reflects the 6z GFS model view of rainfall over the next 10 days. Notice that rainfall totals have been
reduced for the IL and the W Midwest. It’s IN and OH that will endure the heaviest rain into June 3rd. The 11-15 day forecast remains wet in all Central US crop areas with another push of Canadian air to the south – additional cool/wet weather!
** GFS 10 Day Rainfall Forecast:
