** AgResource Daily Cattle Analysis: Cattle futures were mostly higher at the close of business on Thursday, and a steady outlook is offered for early trade this morning. August cattle were back and forth through the day, but able to build on technical strength left from Wednesday. June was down slightly, ahead of today’s expiration. Feeders closed firm while the cash index continues to recover and jumped $1.84 to $148.70. Cash trade was similar to Wednesday, and down $2-3 at $119. The beef market continues to correct and the choice value was down $2.88 and select was off $2.51 on light to moderate demand and heavy offerings.
The beef export pace has been fairly consistent all year, though new sales have slowed over the last 2 months as beef prices have surged to new highs. Cumulative shipments are at 112% of a year ago and at a 5 year high, while outstanding sales are at a 107% of a year ago and the largest since 2003.
We are not anxious to sell cattle lower, though hedgers can start to consider sales to the end of the year on another $3-5 recovery.
** US Weather Pattern Discussion: The US & EU models are in better agreement on the forecast this AM. The GFS models have given up on forming a tropical storm in the Atlantic. The improved model agreement raises our confidence in the forecast solution heading into the weekend.
ARC is becoming confident that July will end up being warmer than normal, which is much different than prior years. Warm overnight Midwest temps will be featured into mid July with any intense heat located from Colorado into the Plains. A Ridge of high pressure will develop early next week and hold across the intermountain west – and at times nudge into the Plains and the W Midwest.
No extreme heat is expected in the E Midwest with a southward sinking jet stream offering rain chances every 3-4 days. The EU rainfall graphic reflects the E Midwest rain chances.
Unfortunately, the rain chances for the N Plains and the NW Midwest will be limited and the drought in the N Plains will be spreading south and east with time. Note that IA/MN received less than normal rainfall during June – a trend that looks to persist into mid July with warming temperatures. This is a concern.
** EU Model 10 day Rainfall Estimate:
