Northern and central US states this morning are seeing “life-threatening temperatures and wind chills as a huge low swirls south out of Canada slinging an arctic blast into the Plains and upper Midwest.\r\n The system is expected to move east over the next few days, but in the meantime, livestock and people could be in jeopardy. All of Minnesota’s schools are closed today because of the extreme cold and wind chills.\r\n The cold brought snow to the Plains and upper Midwest, but the back side of the swirling air mass was expected to bring rain and freezing rain into the Northeast before the cold front moves in and changes it to snow as this image from Intellicast shows: <a href=\”http://images.intellicast.com/WxImages/Radar/usa.gif\”>Your text to link…</a>\r\n The outlook map from the National Weather Service also shows rain/snow mix in the forecast for New England today. <a href=\”http://www.hpc.ncep.noaa.gov/noaa/noaad1.gif\”>Your text to link…</a>. The Plains likely will be left to continue digging out from the weekend snow and dealing with the cold.\r\n Meanwhile, grain and soybean futures are up in overnight trading as traders anticipate an aggressive rebalancing effort from Index Funds. In particular, the funds are expected to key in on corn futures after corn lost 36% in value last year, AgResource said.\r\n The looming January crop report on Friday was expected to keep traders nervous this week as well. Most expect the USDA to raise its estimate of the 2013 corn crop, although soybeans could see a minor downward adjustment. Much this may already be in the market, but with the addition of the fund rebalancing, wide daily trading ranges could result.\r\n Wheat is seeing limited support from the cold weather. Most think the crop is pretty safely held under a blanket of snow, but with such extreme temperatures there is a nagging fear among some that a significant portion of the winter wheat is inadequately covered.\r\n But cash grain and soybean markets this week could be sluggish as farmers deal with the snow and extreme cold and its effects on equipment. At such temperatures, steel can become brittle, engines can freeze, and diesel fuel jells. And barge traffic on the upper Mississippi and Illinois and Ohio Rivers will be at a standstill because of ice.\r\n Even the Illinois River, which normally doesn’t freeze completely, may be blocked with this arctic blast.\r\n But even though US weather is an impediment to traffic and trade, nearly ideal South American weather remains a negative. Hot temperatures are interspersed with rain events for a near-normal weather pattern.\r\n And Brazil’s early soybean harvest has begun, market analysts said.\r\n US cattle are being stressed by the arctic temperatures, but since they are dry, their ability to deal with the cold is optimized, university studies have shown. Feed conversions likely will go down as more of the feed consumed us used for bodily maintenance. Death loss may be a function of how long the cold weather lasts. Forecasts call for temperatures to begin moderating by midweek.\r\n Wholesale beef prices were higher Friday, possibly in anticipation of the cold weather in the forecasts. Feedlot managers may hold cattle back to regain some of the fat lost to cold weather maintenance, making it difficult for packers to fill their slaughter schedules in the next week or two, which could raise beef prices.\r\n The USDA reported its choice beef cutout value Friday at $202.41 per cwt up $1.86 on the day and up $5.42 for the week. The select cutout value was pinned at $197.38, up $1.33 for the day and up $6.08 for the week. The choice/select spread widened to $5.02, but there were only 96 loads of fabricated product sold into the spot market.\r\n However, chicken is giving red meats some serious competition at the retail counter, market analysts said. This could affect consumer buying trends and cap beef prices, especially since they have already reached record levels.\r\n The CME Feeder Cattle Index for the seven days ended Thursday was $169.47, up $1.99. The Jan feeder cattle futures contract settled Friday at $167.62, up $0.62.\r\n Additionally, the US Dollar Index was up overnight. Investors see the Greenback regaining vibrancy against other currencies as the economy continues to show signs of life. A Financial Times article pointed out that the housing market is recovering and employment is rising. The US budget deficit is being trimmed, and the Federal Reserve has begun to taper its bond-buying program, which the market appears to be handling fairly well.\r\n Stock values appear to be weathering the cut in bond purchases, but rates could rise, along with the Dollar.\r\n The rising US currency could then alter the picture of imports and exports by increasing imports, including meat, and hindering exports.\r\n
Cattle feeding is pretty straightforward - doing it profitably isn't.