WASDE Report Fails to Persuade the Corn Market
Friday’s USDA World Agricultural Supply and Demand Estimates report cut corn yields by a larger-than-anticipated amount, but the market came under pressure within an hour of the report’s release. Yield came in at 175.1 bushels per acre, with the trade expecting 175.5.

Overall, this brought production down 209 million bushels from July. Small cuts to feed, seed, and export use on the other side of the balance sheet brought ending stocks to 2.202 billion bushels, down 60 million from last month but ahead of expectations for 2.168 billion.

USDA also published an acreage update showing 1.421 million acres filed for “prevent plant” with North Dakota losing the most area. Overall, the number was in the “normal” range.

Yields in this WASDE report are based off farm surveys and the trade appeared to brush off the numbers. Prices went down to test the $4.80 per bushel lows and began to bounce once there. Cooler temperatures and some moisture across the country has funds feeling corn production will be better than expected. Many producers across the country are also feeling better about their crop as they get eyes on it following pollination. Farm tours will be starting in a couple of weeks and that will be the next thing the market looks at to justify where yield is and can come in. Stay tuned!

Futures: Mostly Sideways
Live and feeder cattle futures closed lower on the week, continuing their mostly sideways trade. October live cattle closed $1.575 per hundredweight lower on the week at $181.325. September feeders closed $2.000 per hundredweight lower at $251.45. Charts show prices coiling and building pressure, often indicating a sharp breakout to one side or the other.

Cash cattle moved at $180 per hundredweight in the South and $188 in the North. Dressed trade in the North occurred at $295 per hundredweight. These prices were mostly steady with the previous week. Choice boxed beef closed the week $0.82 per hundredweight higher with select cuts up $0.75. The US dollar closed the week higher for the fourth week in the row. A stronger US dollar is negative for US exports. Stocks finished mixed, with the Dow Jones Industrial Average up some but the NASDAQ losing ground. Crude oil futures closed higher for the seventh consecutive week at $83.19 per barrel.

USDA Cuts Beef Production Estimates
USDA’s August WASDE report projected an overall decline in 2023 red meat and poultry production, with volume estimated at 107.55 billion pounds, down slightly from the July projection and up just a fraction over 2022.

Beef production came down 180 million pounds from the July estimate on lower steer and heifer slaughter as well as lighter dressed weights despite higher cattle slaughter. The August forecast calls for annual beef production to reach 26.98 billion pounds. That would be 1.31 billion pounds less (-4.6%) than 2022. USDA sees production dropping again in 2024: 25.17 billion pounds, or 3.13 billion pounds less than 2022 (-11.0%). This resulted in a forecasted 2024 5 Area-Direct-total all grade steer price of $186 per hundredweight.