The USDA crop condition report that came out yesterday showed that the corn Good to Excellent rating remained at 64%. This came as somewhat of a shock to traders as some were expecting the hot and dry weather to have a more detrimental effect on the crop. I still believe this could still be the case for the following week as the hot weather across the south and west are now starting to creep up into the Western Corn Belt.
The selling that took place in Dec corn this morning gave support to the October feeder cattle contract as feeders rallied over $2 on the day to close at 184.57. Technically, the Oct feeder chart looks bullish to me but failures to breakthrough July 13th high along with light volume being traded overall give me some cause for concern in the short term. The cattle on feed report comes out this Friday so traders may take profits and sit on the sideline until the report comes out. I still believe the weather still remains the primary focus for both the grain and cattle markets as threats of extreme heat would not only ruin the incoming crop, but as I’ve been saying for the past week, it is starting to effect beef production late in the year.
Boxed beef cutout values were up today closing at 272.98, which is an increase of $2.43 from the previous day.
The cash cattle trade was quiet on Monday as only 40 head were reported in Nebraska at 143.50. The 5-area weighted average steer price last week was 142.12, which was down from 144.35 from last week.
The slaughter numbers came in at 125,000 head yesterday, unchanged from last week.