Source: John Michael Riley, Asst. Extension Professor, Department of Agricultural Economics, Mississippi State University
Since the previous In the Cattle Markets was released the U.S. government shutdown has ended and federal employees are back at the grind. A few of the more prominent National Agricultural Statistics Service (NASS) October reports scheduled for release during the shutdown were canceled (most notably the World Agricultural Supply and Demand Estimates and Crop Production report). Others like the Cattle on Feed report, to be released after the shutdown, have been delayed. Price and production data available via the Agricultural Marketing Service will not forever be a blank spot on the record books as had been speculated.
So now what? So much has already been discussed in this space and elsewhere regarding the shutdown and its impact on the beef industry. As John Anderson noted two weeks ago in this spot, we in agriculture are spoiled when it comes to availability of data and many had to seek private resources for this information. Never the less, cash markets still operated, transactions took place, and buyers and sellers bought and sold.
On a mildly related note, the devastating news of the storm in South Dakota that impacted producers was taking shape at the same time as the shutdown. Also, trade issues were surfacing related to zilpaterol and a potential bin busting corn crop was in the midst of harvest.
So, as has been the case so often in the past few years, information continues to move at lightening speeds. As I survey producers in Mississippi and surrounding states I am constantly surprised by the number that have smartphones and other handheld devices (I’m sure you are aware of the increasing age of beef cattle producer, right?). So, it seems fitting that at a time when information is moving so rapidly, to have a huge chunk of the public portion of this information come to screeching halt must have had far reaching effects. While we will not have the analytical answer to this immediately, taking a quick pass at the market pre-, during-, and post-shutdown it appears that the answer is… “meh.” Both live and feeder cattle futures appeared to have an immediate love affair with the news of data returning only to see the sparks fizzle mid-day on October 17, but for the most part markets trended higher throughout the entire process.
Much of the market data are still being filled. Live and dressed prices across the feeding region were reported at $129-$131/cwt. and $204/cwt., respectively. Live cattle futures were mildly lower last week largely due to a drop on Thursday and feeder cattle contracts were lower as a result of the live cattle drop and a slight increase in corn prices. Wholesale boxed beef prices were near $196/cwt. for Choice and $181/cwt. for Select leaving the spread at $15.