Weekly Commodity Prices Update (7/16)
September corn was up 26 1/2 cents and December corn was up 35 cents. August soybeans closed up 75 1/2 cents and November soybeans were up 62 1/2 cents. September KC wheat closed up 57 1/2 cents, September Chicago wheat was up 77 1/2 cents and September Minneapolis wheat was up $1.03 a bushel.
From Friday to Friday livestock futures scored the following changes: August live cattle up $0.95, October live cattle up $0.03; August feeder cattle down $3.55, September feeder cattle down $3.32; August lean hogs up $4.08, October lean hogs up $5.33.
Friday's slaughter is estimated at 118,000 head, 2,000 head less than a week ago and 3,000 head more than a year ago. Saturday's kill is projected to be around 56,000 head, 32,000 head less than a week ago and 8,000 head less than a year ago. This week's beef slaughter is estimated at 653,000 head, which is 7,000 head more than a year ago.
Boxed beef prices closed lower: choice down $1.93 ($267.94) and select down $0.69 ($251.79) with a movement of 143 loads (79.71 loads of choice, 31.65 loads of select, zero loads of trim and 31.69 loads of ground beef). Throughout the week choice cuts averaged $271.81 (down $11.23 from last week) and select cuts averaged $254.71 (down $6.01 from last week) with the week's total movement of cuts, grinds, and trim totaling 721 loads.
Milk futures put in a wild week with early strength giving way to substantial weakness. Futures closed substantially lower Friday than they were a week ago. The price gains of the past 1 1/2 weeks were eliminated over the past three days. The market always falls faster than it increases. So why did futures increase as much as they had? The likely reason is the pattern that takes place most often when underlying cash rises or falls. In this case, cheese prices increased, bringing more buyers into the spot market as they wanted to purchase cheese before prices move too high. Fundamentals did not support it, but the fear of having to purchase cheese at higher prices later to fill demand prompted them to step in and be more aggressive. Once that buying ran out, no one was interested in purchasing at higher prices. A void had developed under the market. The market now has corrected in line with underlying cash, leaving much frustration in its wake. U.S. City Average Retail prices for June showed whole milk price averaging $3.56 per gallon. This is $0.38 per gallon higher than a year ago and $0.06 per gallon higher than May.
For the week, blocks fell 11 cents with seven loads traded. Barrels declined 14 cents with 27 loads traded. This compares to the previous week when blocks increased 17 cents with barrels gaining 8 cents. That is why barrels have fallen below the previous low and moved back to a price last seen on March 24. Dry whey price gained 3 cents this week with five loads traded. The U.S. City Average Retail price for natural cheese in June was $5.39 per pound.
For the week, butter gained 0.25 cent with 15 loads traded. Grade A nonfat dry milk also gained 0.25 cent with 13 loads traded. Price continues to struggle as supply and demand are fairly balanced. Retail demand has slowed seasonally and has slowed as demand from the food service industry has increased.