Grain and soybean futures prices are mostly lower overnight, led by soybeans as reports of import cancellations mount and as worries about the world’s number two economy rise.\r\n Live cattle and feeder cattle are higher.\r\n China’s economic momentum has slowed, and several banks are cutting their Gross Domestic Product forecasts for the country sharply, according to CNBC. Bank of America Merrill Lynch, Barclays and Nomura cut their estimates of growth for China late Thursday after weak economic reports for January and February.\r\n Bank Of America Merrill Lynch’s downgrade was the most aggressive, taking its estimate of first-quarter growth to 7.3% from 8.0% and its annual growth forecast to 7.2% from 7.6%, CNBC said.\r\n China’s government maintained its official annual growth target of 7.5%, and Premier Li Keqiang said in a press conference that there is some “flexibility†to the target, CNBC said.\r\n That economic weakness may exacerbate an already weakening situation for Chinese consumer meat demand as a slowing economic engine allows less-than-expected meat consumption. Chinese per-capita meat consumption has doubled since 1992 to 52.5 KG as incomes rise, according to a Los Angeles Times story.\r\n But the Chinese hog herd size is down following the Chinese New Year celebrations and so is soymeal demand, analysts say. In addition, China has culled many chicken flocks to control bird flu, and consumers are shying away from poultry out of flu fears, further cutting soymeal demand, which hurts soybeans.\r\n Net weekly soybean export sales were below trade estimates amid light new sales and small cancellations from China and unknown destinations. Soymeal sales also were down.\r\n Ending stocks of soybeans still are likely to be tight, however, as export commitments remain at 106% of the USDA’s estimate.\r\n Weekly export sales of wheat were at the higher end of trade estimates. Total crop-year commitments are at 91% of the USDA’s forecast, which AgResource said is about average.\r\n Of looming importance to wheat and corn markets is Sunday’s vote in Crimea on whether to secede from Ukraine in a step toward becoming part of Russia. US and EU government officials have expressed concerns about the legality of the move under international law, but other than a few economic sanctions, there may be little they can do short of going to war, which nobody seems to want.\r\n Corn is following wheat since both are used as feed grains and Ukraine produces both. Crimea isn’t part of Ukraine’s Grain Belt, but the whole issue adds stress to an already unsettled political picture in Ukraine following a popular uprising that ousted pro-Moscow President Viktor Yanukovych on Feb. 22.\r\n US Secretary of State John Kerry is holding talks with his Russian counterpart Sergei Lavrov in London today carrying a message of “very serious steps†(economic sanctions) should Russia annex Crimea.\r\n But since Crimea is largely ethnic Russian, Sunday’s vote is expected to favor joining the Russian Federation.\r\n The week’s cash cattle trading got started late Thursday in the Plains at mostly $148 per cwt on a live basis, steady with the low end of last week’s price range. Volumes were small, as the hour was late, and most were away from the office for the day.\r\n No dressed-basis trading was reported, but asking prices were around $242 versus last week’s action at $237 to $240. \r\n Cattle futures continued their overall sideways move, finding chart support at the rising 18-day moving average.\r\n Slaughter rates now are ahead of last week, with the USDA estimating the week-to-date kill at 446,000 head, up 0.9% from last week but 7.08% behind the same week a year ago.\r\n The USDA reported choice boxed-beef Thursday at $241.30 per cwt, down $0.21 and select at $236.87, up $0.11. The choice/select spread narrowed to $4.43, but the number of fabricated loads sold into the spot market was active at 172.\r\n Tyson Foods Chief Executive Donnie Smith said in an interview with CNBC Thursday that consumers should brace for higher meat prices. He credited strong demand affording packers the ability to pass along higher input costs.\r\n Meanwhile, the chicken industry is gearing up production as record red meat prices support poultry.\r\n The CME Feeder Cattle Index for the seven days ended Wednesday was $173.60, down $0.10 while the March futures contract closed Thursday at $173.97, unchanged.\r\n
Cattle feeding is pretty straightforward - doing it profitably isn't.