AgResource Daily Cattle Analysis: Cattle and feeder cattle futures closed with strong gains on Thursday and a steady outlook is offered for early trade this morning. Feeder futures gapped sharply higher at the open and then rallied to strong gains into midday. October feeders were stopped at the 100 day moving average but also closed over the 50 day average. Live cattle also put marked good gains, though October remains well under it’s 200 day moving average. A close, above is likely needed for cattle bulls to feel comfortable.
Cash cattle markets went untraded through Thursday, while beef cutouts values were down $.80 on choice and $.51 on select.
The Actual Slaughter report showed an average steer weight for the week of Aug 19th of 884 Lbs, up 2 Lbs from the previous week and 52 Lbs over the seasonal low that was reached back in early May. The week’s steer carcass weight was still 9 Lbs under a year ago, but has been above the 5 year average since late July.
Our outlook stays bearish on rallies as spot cattle futures are expected to test last year’s low under $100. December cattle back to $113-115 offer the next sales opportunity.
US Weather Pattern Discussion: The EU & GFS models are in decent agreement on the 10-day pattern, and both have shifted Hurricane Irma’s path a bit westward. Heavier rain is now indicated in C FL, GA and SC, but still no meaningful rainfall is offered to the S and E Midwest. Modestly better rain chances have been added next weekend, but soaking rain is not expected.
The overall pattern into the last week of September still features dry and warming conditions. Double cropped beans in Southeast will be aided, but moisture deficits elsewhere will be rising. Fortunately, the US and Canadian Prairies look to avoid an early frost/freeze event and beyond the next 2-3 days, a noticeably warming trend will develop in the Plains and W Midwest, reaching into all areas by the latter part of next week. Longer term guidance is still void of any cold snaps into early October, and normal/above normal temps are most likely into early winter.
