** AgResource Daily Cattle Analysis: Cattle futures were mostly unchanged or slightly better at the close on Thursday, and a steady outlook is offered for early trade this morning. Early strength on Thursday found profit taking, and the cattle market spent the day trading back and forth. Cash markets have remained at a standstill so far this week, though the CME is showing at least another $2-3 higher for this week.
The September Livestock Slaughter report showed a combined steer/heifer kill total of 2,341 million head, 106% of last year and the largest August slaughter rate since 2012. The average carcass weight of 858 Lbs was still 8 Lbs under last year, but fed beef production was still at 105% of a year ago, the largest since 2007.
December cattle look ready to close out the July chart gap, which offers hedgers a chance at good 4th quarter sales. ARC’s longer term view is bearish on rallies as we expect record large red meat production to keep US livestock prices under pressure into late in the year. Reduced US beef supplies will be noted in the 1st quarter of 2018.
** US Weather Pattern Discussion: The EU & GFS models are good agreement. A Trough/Ridge pattern will hold across North America and produce heavy rain across the Plains and NW Midwest starting this weekend with the remainder of the Midwest/Delta holding in a warm/dry flow. Above normal temps will push crop maturity with some record heat is expected this weekend. The Delta and Gulf States will see just a few lite showers with the harvest strongly advancing.
No Midwest frost is foreseen into October 6th, but the flow pattern will flatten next weekend that will allow for more seasonal Central US temperatures.
The EU model 10 day rainfall forecast is attached. A stalled front will produce heavy rains across the Plains and the NW Midwest with totals of 1-3.00. The rains start this weekend and continue next week. A high pressure Ridge is in control of the rest of the Midwest/Delta with warm/dry weather conditions. The track of Maria is off the US Eastern Coastline.
Central US high temps will range from the 80’s to mid 90’s for another 5-6 days before a slow cooling trend evolves. More seasonal 50s/60s are offered in early October with the mean position of a Ridge retrograding back westward.