Cattle futures were down 2.9% this week, finishing with a $2.12 loss in the lead month on Friday. Feeder futures also posted heavy losses with nearby September losing 2.8% from a week earlier. Cash cattle trade this week was sharply lower, with some scattered Friday reports at only $111 and $179 in the north. The weekly average will be higher, but the market is clearly panicking in the face of rising supplies and slow exports. Weekly US beef production was an estimated 494 million pounds, up 0.4% from last week and still running 6.9% larger than the same week in 2015. Beef production YTD is now up 4.6%, while export sales are up only marginally. US export sales of beef for the week ending August 18 were only 8,030 MT, down about 43.2% from the prior week. That is not a pace that will clean up the supply.
Wheat prices were down 11/4% on the week in CHI, with KC and MPLS down 7.4% and 7.8% respectively. There was a final bearish push on Friday with daily losses in the front months of 18 cents for CBT wheat, 16 cents for KC and 5 cents for MPLS futures. The spread between front month MPLS and front month CBT futures expanded another 5 cents Friday/Friday to $1.09 per bushel. MPLS initially lost ground on the Canadian production report, but Chicago was sharply lower on Friday to widen the spread back out. StatsCanada published its updated estimates for the 2016 wheat crop, calling for the second largest national production figure ever. Their projected national average yield was 48.9 bushels per acre, up 14.25% from 2015. IGC raised their world estimate by 8 MMT. US weekly wheat export sales were slightly larger than the prior 4 week average.