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April 2013 Archive for The Allendale Wake-Up Call

RSS By: Paul Georgy, AgWeb.com

Paul Georgy serves as president/CEO of Allendale, Inc., a worldwide agricultural advisory and research firm that provides agricultural commodity price research and risk management alternatives for producers, major food companies, international corporations, foreign governments, and major news vendors.
 

Planting Progress Lowest Since 1985

Apr 30, 2013

Good Morning! Paul Georgy with early morning comments for April 30, 2013 at 4:50 am. Grain futures are higher on follow through buying. The USDA’s planting progress increased by only 1% last week to 5% which ties the record low in 1985. The greatest delays in planting are in the I-states of IL, IN and IA. Normal for this time of year is 31% and last year we had 53% planted. Winter wheat conditions fell by 2% to 33%, good to excellent. The Wheat Quality Council Tour starts scouting field in Kansas this morning. I suspect there will be updates on social media as they progress through the day. Funds are estimated to have bought 26,000 contracts of corn, 9,000 contracts of wheat and 7,000 contracts of soybeans on Monday. There were no deliveries in corn or soybeans, however there were 604 wheat deliveries against the May Contract. Traders will be watching the weather forecast closely to get a handle on when the corn can get in the ground. World Weather Inc. is concerned about a potential frost/freeze in the Hard Red Wheat area on Wednesday night Thursday morning. The inability to plant corn has farmers holding on to any unsold cash corn and soybeans. The strong cash markets continue to provide support to nearby futures. Corn basis was steady with soybeans up another 10 cents on Monday. Rich Nelson will discuss how planting delays will effect the USDA Supply and Demand report next week. Allendale’s Ag Leaders Webinar is tonight at 7:00 pm, sign up NOW! Cash cattle trade is at a standstill with asking prices 130 to 131 and no solid bids. Boxed beef was sharply higher on Monday with choice up 1.90 and select up 1.79. The feeder cattle index was up 1.09 to 135.44. Live hog futures try to grind higher even with higher feed costs facing producers. Pork cutout values were up .52. Sign up for Allendale’s free market update text, delivered every Monday thru Friday by 11:30AM CDT.

Markets as of 4:50 AM

  • Jul Corn    +6 3/4
  • Jul Beans   +11 1/4
  • Jul Wheat   + 1/2
  • Jun Cattle  +.00
  • Jun Hogs    +.02
  • Jun Dlr     +.03
  • Jun S&P     -.75
  • Jun Crude   +.05
  • Jun Gold    +4.60

 

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Weather Forecast Excites Markets

Apr 29, 2013

Good Morning! Paul Georgy with early morning comments for April 29, 2013 at 5:10 am. Grain futures are higher on weather forecasts, firm basis and estimates for this afternoon’s Planting Progress Report. Weekend moisture reached a little further north than was expected. The 6 to 10 day forecast has heavy rains moving through the Midwest at a time when field conditions are finally drying out. David Scheibel, Allendale’s Branch Manager in Bird Island, MN reported that a neighbor of his was planting green peas on Sat and Sun with snow still along the fence rows. Farmers were in the field in McHenry County, IL yesterday. Planting progress is expected to be 7 to 15% complete compared to an average of 33%. The changing of the calendar to May in just a few days has traders concerned about planting progress of corn. Wheat is supported by corn and the beginning of the wheat crop tour is on tap for this week. First notice day is Tuesday for the May contracts at the CBOT. Funds were huge sellers again last week. Managed Money Funds reduced long positions by 40,000 contracts to leave them net long only 12,000 contracts in corn. There will be several countries releasing important economic data this week which could have a influence on the grain and livestock markets. The strong cash cattle trade on Friday and weaker dollar could provide some support in futures. The warm weather in Chicago and on the East Coast should show a pickup in movement of meat products. We will be watching box movement early this week for a confirmation. Boxed beef on Friday was mixed with choice up 1.35 and select down .07. The feeder cattle index was 134.65, up .64. Pork cutout value was up .38. Allendale’s Ag Leaders Webinar is tomorrow evening sign up NOW!

Markets as of 5:10 AM

  • May #Corn    +11
  • May #Beans   +1 3/4
  • May #Wheat   +5
  • Jun #Cattle  Steady-Higher
  • Jun #Hogs    Steady-Higher
  • Jun Dlr     -.36
  • Jun S&P     +4.25
  • Jun Crude   +.42
  • Jun Gold    +18.10

 

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Grains Set For Volatility

Apr 26, 2013

Good Morning! Paul Georgy with early morning comments for April 25, 2013 at 5:05 am. Grain futures are lower on profit taking, changing weather forecast and first notices day adjustments. Exports sales did not provide any positive news yesterday morning. However, the USDA did confirm sales of 300,000 tonnes of new crop corn to China and 240,000 tonnes of new crop corn to unknown buyers. We also saw cancellations of old crop soybeans by China. The tight holding of soybeans and corn by farmers is providing strong support to old crop prices. Basis for meal continues to firm as processor struggle to buy soybeans. The forecast for snow next week from KS to MN by various models has traders on edge. The first notice day for May contracts is Tuesday. Traders are required to reduce position size down to 600 contracts. With the large amount of bull spreading we have seen in recent weeks, we could be in for a volatile next few sessions. The trade is not expecting deliveries as cash prices are at a significant premium to futures. Funds were estimated to have bought a net 7,000 corn contracts, 3,500 wheat and 8,000 soybean contracts on Thursday. CME cattle futures are testing downtrend resistance lines as traders become optimistic on cash prices. There were 12 cattle deliveries on Thursday. Choice beef was steady while select was down .31 yesterday afternoon. The feeder cattle index was up 1.23 to 133.71. Hog markets continue to rally on fund buying and an outlook for cookout demand to help clear the retail counters. Traders buying the nearby contracts and selling the deferred contracts has had a sharp move in recent days. Contact your Allendale Broker for further trade ideas. Remember to sign up for the April Allendale Ag Leaders webinar next Tuesday April 30.

Markets as of 5:05 AM

  • May #Corn    -2 3/4
  • May #Beans   -1
  • May #Wheat   -3 1/2
  • Jun #Cattle  +.20
  • Jun #Hogs    +.12
  • Jun Dlr     -.09
  • Jun S&P     -4.75
  • Jun Crude   -.60
  • Jun Gold    -.20

 

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Argentina Corn Cheaper Than US

Apr 25, 2013

Good Morning! Paul Georgy with early morning comments for April 24, 2013 at 5:00 am. Grain futures are higher on short covering and support from outside markets. Weather forecasts have become a little colder in the northern Midwest and rains in the south. There will be days of open weather but the various models are conflicting on when it arrives. Spreaders are likely to dominate the trading volume as we approach first notice day in May contracts.  Tight US supplies provide support to nearby contracts. Traders will be watching the Weekly Export data this morning for any surprises. See below for trade estimates for this morning's report. A South Korea corn buying group purchased 55,000 tonnes of optional origin corn which is either South America or South Africa. Argentina corn is $1.08 cheaper than the US Gulf price. US soybeans are $1.70 higher than Brazilian beans if you can tolerate the shipping delays out of Brazilian ports. Ethanol production last week was only 1% less than last year however still running 10.8% below last year on average. USDA’s projection is a 9.2% drop from last year.  Statistics Canada says Canadian farmers will plant nearly 2.4 million acres less canola and they suggest that wheat acres would increase by nearly 3 million acres. Brazil's government is forcing exporters to dump trucks on a timely basis. Bird flu in China is having a huge impact on their poultry industry. There are reports that poultry demand has dropped by 70 to 80% in eastern China which in turn is causing a slump in soybean demand. Livestock traders are expecting cash cattle to trade at 127 to 128 this week. Boxed beef was firmer on Wednesday with choice up .13 and select was up 1.03. The feeder index settled up .07 at 132.48. Live hog futures seen fund buying yesterday on hopes of improving cash markets. Pork Cutout value was up .09. Remember to sign up for the April Allendale Ag Leaders Webinar next Tuesday April 30.

Export estimates in thousand metric tonnes

                Old Crop           New Crop
Corn            200-400            150-300
Soybeans        250-350            450-600
Wheat           200-400            400-600

 

Markets as of 5:00 AM

  • May #Corn    +3 1/4
  • May #Beans   +11 3/4
  • May #Wheat   +4 3/4
  • Jun #Cattle  +.32
  • Jun #Hogs    -.02
  • Jun Dlr     -.34
  • Jun S&P     +3.25
  • Jun Crude   -.22
  • Jun Gold    +22.10

 

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Lower Corn And Wheat

Apr 24, 2013

Good Morning! Paul Georgy with early morning comments for April 24, 2013 at 5:10 am. Grain futures are mixed. Old crop soybeans are stronger as tight supplies provide buying interest. Corn and wheat are lower as we approach first notice day. Goldman Sachs lowered its outlook for commodities on Tuesday which has been weighing on trader’s minds. China reported another death from bird flu. That, coupled with weaker economic data has grain traders reducing the estimated amount of soybeans they will need to import this year. Oil World reports that the Ukraine’s oilseed crop is expected be a record production in 2013. Funds were estimated to be net sellers of 8,000 corn contracts, 2,000 wheat and 4,000 soybean contracts yesterday. Brazil has cut the tax on ethanol which will be a huge support to their sugar industry and make their ethanol more competitive. The Macon, MO ethanol plant is back on line after a technology improvement to extract corn oil. Allendale’s April Ag Leaders webinar next Tuesday will discuss planting and yield effects on 2013 production. Sign up today! Cash cattle traders have a larger showlist this week. Packer’s margins are in the red. Retailers are buying more meat as they seem to be getting ready for the beginning of the cookout season. Boxed beef was higher on Tuesday with choice up .63 and select up .11. Cash hogs are higher and pork cutout values improved .97. Have you signed up for the free daily text from Allendale?

Markets as of 5:10 AM

  • May #Corn    -1 1/2
  • May #Beans   +3
  • May #Wheat   -5 1/2
  • Jun #Cattle  +.35
  • Jun #Hogs    +.27
  • Jun Dlr     -.14
  • Jun S&P     -4.00
  • Jun Crude   +.72
  • Jun Gold    +13.00

 

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Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Planting Progress Ties Record Low

Apr 23, 2013

Good Morning! Paul Georgy with early morning comments for April 23, 2013 at 5:00 am. Grain futures are lower after what should have been supportive news late yesterday.

Commodity liquidation by funds seems to be the force in the pressure we are seeing this morning. USDA put last week’s total corn planted at 4% which would tie the record low for this date in 1993. We will likely continue to run behind as the 1 to 5 day outlook is for more rain to cover the majority of the Midwest.

Rich Nelson shared a study comparing years where we have corn planting delays of 10 % or more. Three out of four years corn planted acres increased and yield declined from trend yield. It is likely the USDA will make some adjustment for yield on the May 10th report. With the probability of adjustments, we could still see ending stock for 2013/14 increase in corn. Get the full report by going to www.allendale-inc.com and click on Strategy Sessions.

The USDA made very little change in winter wheat conditions when they lowered the G/E to 35% from 36%. There are reports out of Brazil that farmers are moving soybeans as much as 1,000 miles by truck to a southern port to bypass loading delays at the 2 major ports.  Funds were net sellers across the board yesterday as it is estimated they sold 7,000 corn contracts, 3,000 wheat and 7,000 soybean contracts.

Mississippi River barge traffic has come to a standstill as flood waters are causing havoc. Bull spreading is still the feature as farmer selling remains light. Livestock markets absorbed the negative news well on Monday.

Traders are hoping for a warm weekend in the metropolitan areas which could help movement of the higher valued cuts of beef and pork. Choice beef was up .68 and select was up .04 on Monday. Pork cutout values were up 1.54. Sign-up is now open for the Monthly Ag Leaders Webinar.

Markets as of 5:00 AM

  • May #Corn    -3
  • May #Beans   +4 1/2
  • May #Wheat   -8 1/2
  • Jun #Cattle  +.05
  • Jun #Hogs    +.25
  • Jun Dlr     +.27
  • Jun S&P     -2.00
  • Jun Crude   -.84
  • Jun Gold    -7.60

 

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Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Weather Forecasts Change

Apr 22, 2013

Good Morning! Paul Georgy with early morning comments for April 22, 2013 at 5:00 am. Grain futures are lower. Weather maps show cooler temps for the near term with warmer drier conditions in the 11 to 16 day forecast. Planting progress this afternoon will be watched closely. We are hearing estimates by trade of 5 to 6% planted compared to 18% average. The slowest planting pace was in 1993 at 4%. Wheat conditions in the HRW area will be very important as USDA held the good to excellent at 36% last week. Producers are reporting damage from the recent frost and the forecast is calling for freezing temps as low as the TX Panhandle tomorrow morning. Expect cash news and changes in weather forecast to be the price driver this week. Watch for news on damage from the earthquake in China. Money managers increased long corn positions by only 1,411 contracts and they added nearly 12,000 contracts in soybeans for a net long position of 74,569 contracts. As you get busy in the field, receive the Allendale 11:30 text update free. The USDA released the Cattle-on-Feed number for April 1, 2013. The data was considered by the trade a little bearish. As cattle placed into feedlots during March were larger than expected would have to be attributed to the drought in the southern plains. Cattle producers had no hay or pasture and feedlots were the only alternative. Boxed beef was lower on Friday with choice down .69 and select was down .62. Pork cutout values were down .41. The feeder cattle index was down .33 to 134.53. Hog slaughter should tighten for seasonal reason. See chart here.

Markets as of 5:00 AM

  • May #Corn    -5 3/4
  • May #Beans   -6 1/2
  • May #Wheat   -6 1/2
  • Jun #Cattle  Steady-Lower
  • Jun #Hogs    Steady-Lower
  • Jun Dlr     +.07
  • Jun S&P     +8.50
  • May Crude   +.69
  • Jun Gold    +38.70

 

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Quiet Session Overnight In Grains

Apr 19, 2013

Good Morning! Paul Georgy with early morning comments for April 19, 2013 at 5:00 am. Grain futures are mixed this morning as bull spreads dominate trade. The question most asked yesterday afternoon was, what made the corn go down? It could be a combination of things. Basis weakening along the Mississippi because of possible river closure due to flooding or it could be liquidation of long positions ahead of first notice day. However funds were big sellers in corn futures after prices tested technical resistance. They were estimated to be net sellers of 13,000 contracts. Export sales data was supportive for corn, beans and wheat. Weather forecasts remain on the friendly side as forecasting models suggest a cooler than normal 10 to 15 days out. Bull spreads have recovered overnight with May contracts gaining on the July and Dec. Cash grain markets are the leaders as farmers have locked the bin doors and holding out for higher prices or at least until they get some seeds in the ground. Soybean and meal basis is on fire. There are reports of soybean processors in IA bidding $1.00 over the July futures. However river bids are lower as exporters are concerned about high water. Meal basis continues to strengthen as some processors are closing and others are slowing down productivity due to lack of their ability to buy soybeans. Cold weather has hit the HRW areas again. We have to wait a few days to assess the real damage. We expect more choppy markets with spreaders being the feature as we close out this week. Sign up for a free market update text at 11:30 AM. Cattle futures drifted lower as cash market trade remains at a standstill. Boxed beef values were lower on Thursday with choice down .54 and select down .24. Cattle traders will be adjusting positions ahead of this afternoon’s Cattle-on-Feed report. Hog futures are trying to fight the downtrend as a technical head and shoulders formation develops on the charts. Pork cutout value was up .41 on Thursday. Try a free trial to the Allendale Advisory Report.

Markets as of 5:00 AM

  • May #Corn    - 3/4
  • May #Beans   + 1/2
  • May #Wheat   -2 3/4
  • Jun #Cattle  -.30
  • Jun #Hogs    -.30
  • Jun Dlr     -.13
  • Jun S&P     +10.75
  • May Crude   +.87
  • Jun Gold    +21.00

 

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Grain Futures Are Higher

Apr 18, 2013

Good Morning! Paul Georgy with early morning comments for April 18, 2013 at 5:05 am. Grain futures are higher as most traders in the Chicago area listen to the rain falling. The rain event moving through the Midwest has traders concerned about the planting progress as the calendar quickly nears May 1st. This concern is causing profit taking in the bull spreads. There is some exiting of May futures position as we are down to 7 trading days before first notice day. Tight supplies of soybeans and poor crush margins have processors slowing down production which is causing a very volatile cash meal market. Soybean meal basis jumped $4 to $6 on Wednesday. Demand for old crop corn and soybeans will be important numbers when USDA releases the weekly export data this morning at 7:30. Trade estimates are for corn old crop 100 to 300 tmt and new crop 100 to 400 tmt, soybeans old crop 100 to 500 tmt and new crop 50 to 500 tmt, soymeal 50 to 225 tmt and  new crop 0 to 200 tmt, soyoil old crop 0 to 15 tmt and wheat old crop 50 to 325 tmt and new crop 80 to 500 tmt. As many of you prepare to go to the field, Allendale is providing a free text message market update at 11:30 am. Just fill out the signup information by clicking here. China’s bird flu problem continues to grow as more are found ill from the virus. The Cattle on Feed Report will be released on Friday at 2 pm. Trade estimates are for cattle on feed to be 6% less than last year, placement’s range from 92.1% to 103.2% of last year. Marketing’s during March are expecting to be 96.6% of last year’s number. Traders are looking for some positive news to help support futures and cash. Feedlot trade is still at a standstill with offers at 126 to 127. Boxed beef was higher on Wednesday with choice up .88 and select up .56. The feeder cattle index is 135.61 down .25. Pork cutout values are up 1.01. Check out the Allendale Advisory Report for more details.

Markets as of 5:05 AM

  • May #Corn    +1/4
  • May #Beans   +6 3/4
  • May #Wheat   +6 3/4
  • Jun #Cattle  +.15
  • Jun #Hogs    +.02
  • Jun Dlr     -.17
  • Jun S&P     +5.75
  • May Crude   +.89
  • Jun Gold    +11.00

 

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Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Change Of Focus By Grains Traders

Apr 17, 2013

Good Morning! Paul Georgy with early morning comments for April 17, 2013 at 5:10 am. Grain futures are mostly higher. With macro markets calming down, grain traders are focusing on the tight cash markets and wet weather heading for the Midwest. Processors and ethanol plants are worried about filling their needs and farmer selling has been quiet. Recent rallies in old crop futures combined with strong basis should create some movement. There is talk that China is looking for some old crop beans to fill immediate needs; no confirmation of any sales yet. Monday’s report of only 2% of the US corn crop planted has traders becoming concerned as a storm system approaches the Midwest. Models are suggesting 2 to 4 inches of rain for much of the central cornbelt with localized amounts up to 6 inches. It will then be clear for a period of time once this system moves through. Spreading has been the feature in the grain complex recently. We expect that to continue into first notice day of the May contract. Wheat finds support with the potential for cold temps as far south as the TX Panhandle Thursday and Friday mornings. It is unknown as of yet how much crop loss we will see from the last cold snap in the southern plains. There is talk of Russia selling wheat out of the Black Sea region in an effort to support domestic prices. Weather in the EU is improving for winter and spring crops. A few cash cattle traded at 125 in the south on Tuesday. Most feedlots are hoping for steady with last week which would be 127 to 128. Boxed beef was firmer on Tuesday with choice up .56 and select up .02. The feeder cattle index was down 1.73 to 135.86. Pork cutout values were up .31. We are estimating the hog slaughter to shrink over the next few weeks as producers focus on fieldwork. Stay in touch with Allendale Advisory Report.

Markets as of 5:10 AM

  • May #Corn    -1 1/4
  • May #Beans   +4 1/2
  • May #Wheat   +1 1/2
  • Jun #Cattle  +.12
  • Jun #Hogs    +.02
  • Jun Dlr     +.31
  • Jun S&P     -7.50
  • May Crude   -.68
  • Jun Gold    -5.70

 

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Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Grains Claw Back

Apr 16, 2013

Good Morning! Paul Georgy with early morning comments for April 16, 2013 at 5:00 am. Grain futures are mixed with soybeans leading the strength. After giving back last week’s gains in one session traders are again looking at the fundamental news. USDA said Monday afternoon that we have 2% of the corn planted nationally which compares to a 7% average and 17% a year ago. Wheat conditions remain the same as last week at 36% G/E. It appears that the USDA believes the rain was as beneficial as the freeze was damaging. China buying 480,000 tonnes of wheat yesterday leads us to think further weakness could encourage more purchases. Weather forecasts are expecting more rain for the Southern Plains and Midwest this week. Thursday and Friday morning will have a chance for a freeze as far south as northern TX.  On Monday funds sold an estimated net 10,000 CBOT corn contracts; they also sold 7,000 wheat and 8,000 soybean contracts. The NOPA crush numbers yesterday suggest plants will have to shut down in order to meet the USDA target. Soybean crush is running at 7% above last year. In order to meet USDA target of 4% less than last year it suggests we need to crush 14% less for the balance of the marketing year. Cash hog markets have dropped sharply on a pickup in movement after last week’s snow storm. Any disruption in product movement has given traders a reason for selling. A warm weekend in the metropolitan areas would likely help move some higher priced cuts. Boxed beef prices were mixed with choice up .37 and select down .23. Pork cutout values were up .74. Feeder cattle index was down .59 to 137.59. Liquidation of gold positions by funds led the selloff of commodities. Any bounce in gold could provide a bounce in agricultural markets. Call your Allendale broker with questions, 800-2MARKET.

Markets as of 5:00 AM

  • May #Corn    - 1/4
  • May #Beans   +12
  • May #Wheat   - 1/2
  • Apr #Cattle  -.15
  • Jun #Hogs    +.10
  • Jun Dlr     -.09
  • Jun S&P     +8.50
  • May Crude   -.38
  • Jun Gold    +28.00

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Gold Selloff Leads Grains

Apr 15, 2013

Good Morning! Paul Georgy with early morning comments for April 15, 2013 at 4:58 am. Grain futures are lower on carryover pressure from metals and crude. Gold is down nearly $100 per once and crude oil is down almost $3.00 per barrel. The moisture forecast has very little change since Friday. The next 4 days are expected to be wet with some areas of the cornbelt getting 2 to 4 inches. This afternoon, we get the first USDA weekly planting progress report for corn. Analysts are expecting 4 to 6 percent planted compared to last year of 17% and average of 6%. Wheat conditions are expected to be 2% lower in the G/E category due to last week’s freeze in the southern plains. There is another cold wave moving into the southern plains on Thursday morning which will be watched closely. The CFTC commitment of traders report showed managed money reducing long positions in corn by nearly 44,000 which puts them net long of only 51,000 contracts. They reduced longs in soybeans by 15,000 contracts, leaving them long 62,600 contracts. NOPA will release the March crush data this morning. We are reminded that the last 2 data results were disappointing. Weakness in metals and economic data releases this week will like have an impact on market movement. Livestock traders are looking to Friday’s Cattle-on-Feed Report to provide some buying support. Boxed beef prices closed the week mixed. Choice was down .63 with select up .15. Pork cutout values were down 1.15 on Friday. The feeder cattle index was down 1.10 to 138.18. For a complete look at all of our advisory services, subscribe to the Allendale Advisory Report today.

Markets as of 4:58 AM

  • May Corn    -7
  • May Beans   -2 1/4
  • May Wheat   -10
  • Jun Cattle  Steady-Lower
  • Jun Hogs    Steady-Lower
  • Jun Dlr     +.07
  • Jun S&P     -9.75
  • May Crude   -2.82
  • Jun Gold    -108.00

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Old Crop Corn Leads Charge

Apr 12, 2013

Good Morning! Paul Georgy with early morning comments for April 12, 2013 at 5:05 am. Grain futures are higher.  Spreaders came back into the corn and soybean markets in a big way yesterday. The estimate is 65% of the volume was spreading yesterday. The trade seems to have figured out that old crop supplies are tight. Export sales data was good for soybeans while corn exports remain dismal. Domestic demand for corn remains strong where ethanol margins are positive.  The active weather patterns forecast for the next 10 days is also supportive to the bull spreads as traders want to be long the contracts where the supplies are the tightest. As we have mentioned, planters have been rolling in the southern cornbelt ahead of yesterday’s rains. Monday’s planting progress will be key information for next week’s price trends. The frost damage on wheat will take some time to assess real losses. China is likely to be interested in more US wheat on price setbacks. Rumor of China buying old crop soybeans out of the PNW continues to circulate in the trade, however there has been no confirmation. US wheat exports could get a boost from the Brazilian government waiving the 10% import tariff on up to 1.0 million tonnes. Brazil is the largest South American wheat importer. The CME is changing margins on spreads; check with your Allendale Broker for details. There were no cattle deliveries again on Thursday. Cash markets had light volume trade on Thursday at 127. The outside markets are providing some headwinds this morning as the dollar is a bit stronger. Boxed beef prices continue to slide, choice was down .80 and select down 1.58 on Thursday. Pork cutout value was down .03. The feeder cattle index was 139.28. Subscribe today to the Allendale Advisory Report.

Markets as of 5:05 AM

  • May #Corn    +6
  • May #Beans   +10 3/4
  • May #Wheat   +7 1/2
  • Jun #Cattle  -.12
  • Jun #Hogs    +.15
  • Jun Dlr     +.19
  • Jun S&P     -3.75
  • May Crude   -1.07
  • Jun Gold    -19.10

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

USDA Results Drive Spreads

Apr 11, 2013

Good Morning! Paul Georgy with early morning comments for April 11, 2013 at 5:05 am. Grain futures are mixed as spreaders drive the corn market. The USDA Supply and Demand report had something for everybody. We start with the lower than expected US corn ending stocks, but remember last year stocks continued to rise as months went by. The world numbers were not as friendly when the corn stocks were increased due to reduced world consumption. Cash corn prices should stay firm as producers will not feel comfortable to clean out bins until the new crop is up and growing. Soybeans had little change from last month but USDA lowered the imports by China by 2.0 mmt. This news weighed on the soy complex. The cold weather in TX and OK was not enough to support wheat after the larger than expected ending stocks were released. Demand is key to providing support to grain futures as basis is historically wide. Export sales will be out at 7:30 this morning. Trade estimates are 150 to 600 tmt of old crop and 75 to 300 tmt of new crop corn, 175 to 500 tmt of old crop and 250 to 500 new crop soybeans and 100 to 250 tmt old crop and 125 to 400 new crop wheat. Planting progress will be next big focus by traders. The rains moving across the cornbelt are very important and farmers are anxious but not to worried about getting the crop in on time. Seed companies are also glad to see a bit of a delay which gives them more time to process and deliver seed. Bull spreads are likely to be choppy while giving opportunities to trade. Stay in touch with your Allendale Reps. Friday’s CFTC report will be watched closely to see if money managers are still liquidating. Cash cattle traded at 127 in TX and KS yesterday which is 1.00 lower than last week after futures sold off. Cash hog prices were firmer as packers tried to get producers to move inventory during bad weather. Pork cutout values were up .02. Boxed beef prices were slightly lower with choice down .18 and select down .68 on Wednesday. The feeder index is 139.95. Subscribe today to the Allendale Advisory Report.

Markets as of 5:05 AM

  • May #Corn    +5 1/2
  • May #Beans   -5 3/4
  • May #Wheat   +4 1/4
  • Apr #Cattle  +.22
  • Apr #Hogs    +.30
  • Jun Dlr     -.33
  • Jun S&P     +1.50
  • May Crude   -.10
  • Jun Gold    -1.50

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Weather And Reports Provide Standoff

Apr 10, 2013

Good Morning! Paul Georgy with early morning comments for April 10, 2013 at 5:05 am. Grain futures are mixed in a very quiet overnight session. Traders are making last minute adjustments to positions ahead of the USDA April Supply and Demand Report. Newswire average estimate for corn is 824 ml bushel. However it feels it should be in the area of an 810 to 812 number. A year ago on this report the USDA was at 810 ml bushel carryover for corn and the price of nearby futures was trading 6.30 to 6.40. Allendale suggests the carryover number for corn could be as high as 880. Corn basis fell by 2 to 5 cents yesterday with processors and ethanol plants holding adequate inventory. Soybean basis improved at Midwest processors and at the gulf. Trade average estimate for today’s report is only slightly higher than last month. The USDA estimate for South American corn and soybean production could also be a market mover. Tune into the "After the Bell" YouTube video where Rich Nelson will provide specifics of the report. Weather will be the focus shortly after this report as news stories continue to hype the possibility of late corn planting. Our customers in southern IL and IN are welcoming moisture. Below freezing temps as far south as TX has wheat producers nervous when the drought has already reduced yield potential. The next few weeks should prove to be a battle in cattle price. We are facing a strong seasonal pattern for lower cattle prices into June at a time where on feed numbers and slaughter numbers are getting tighter. Boxed beef values were higher on Tuesday with choice up .46 and select up .56. The feeder index was up .o4 at 140.13. Slower export demand is weighing on pork prices however pork has an advantage at the retail counter. Pork cutout values were down .03. Get the full story by subscribing to the Allendale Advisory Report.

Markets as of 5:05 AM

  • May #Corn    + 1/2
  • May #Beans   -2 1/4
  • May #Wheat   -5
  • Apr #Cattle  -.35
  • Apr #Hogs    +.35
  • Jun Dlr     -.01
  • Jun S&P     +4.75
  • May Crude   -.20
  • Apr Gold    -5.10

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Wheat Conditions Improve Before Cold Snap

Apr 09, 2013

Good Morning! Paul Georgy with early morning comments for April 9, 2013 at 5:15 am. Grain futures are mostly higher. The USDA said wheat conditions improved nationally by 2% last week and expect to release corn planting progress next week. We have customers planting corn and doing fieldwork in Southern IL and IN. The forecast for cold temps into TX and OK this week has producers and traders concerned about potential loss. The winter storm forecast for the CO, NE and SD has well needed moisture for a very dry area. Traders are worried about the late planting of corn but we feel it only is late when compared to last year. Tomorrow at 11:00 AM CDT, the USDA will release their April estimate of grain and oilseeds supply and demand for 2012/13. Trade average estimates are: corn 824, soybeans 137 and 731 for wheat. Last year the April estimate by USDA was 810 and the price range for corn was 6.30 to 6.50. Funds were buyers of an estimated 6,000 corn contracts, 4,000 wheat and 6,000 soybean contracts yesterday. It is expected the White House will make a decision in the coming week whether to approve the sugar for ethanol program. Livestock prices are struggling with demand for product and received no help from February Export Data. Pork volume was down 12.6% for February making year to date exports down 14%. Beef exports were 3% less than last year. Boxed beef values were lower on Monday with choice down .37 and select down .55. Pork cutout value was up .01. Rich Nelson, Allendale’s Chief Strategist has presented a detailed analysis of how the US Unemployment is providing an explanation for beef and pork prices. Check out the Allendale Advisory Report.

Markets as of 5:15 AM

  • May #Corn    +6 1/4
  • May #Beans   +1 1/4
  • May #Wheat   -2 1/4
  • Apr #Cattle  +.52
  • Apr #Hogs    -.07
  • Jun Dlr     -.24
  • Jun S&P     +1.50
  • May Crude   -.22
  • Jun Gold    +1.00

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Markets Prepare For USDA Report and New Trading Hours

Apr 08, 2013

Good Morning! Paul Georgy with early morning comments for April 8, 2013 at 5:00 am. Grain futures are higher as old crop corn and soybeans lead the charge. Spreading has been a feature in early trading. As we start the week, the grain traders have three important influences they will be watching. The Monthly Supply and Demand Report which will be released Wednesday at 11:00 AM CDT, weather forecasts for the Midwest and more news out of China regarding the bird flu outbreak. The trade estimate for corn ending stock is 824 million bushel and soybeans 139 million bushel. Weather forecast has toned down the amount of rain for MO and Southern IL. I am sure we will have many changes before the system is through. Farmers are getting anxious but not ready to change planting plans yet. Remember trading starts daily at 7:00 PM CDT in the evening then halts for 45 minutes at 7:45 AM CDT. Both the pit and electronic open at 8:30 AM and then both will close at 1:15 PM CDT. This is the new trading time for grains which started last evening. The CFTC report on Friday showed money managers reduced long positions in corn by 98,246 which left them long 94,315 contracts. In soybeans they reduced long positions by 35,137 and in wheat increased short positions by 13,244 contracts. Stay in close contact with your Allendale Representative this week. Livestock markets are under pressure and the employment numbers took the wind out of the bull’s sails. The bottom line is less people have the income to afford higher priced meat cuts. Boxed beef prices fell on Friday with choice down .40 and select down 1.24. Pork cutout values were down .17. Subscribe today to the Allendale Advisory Report.

Markets as of 5:00 AM

  • May #Corn    +5 3/4
  • May #Beans   +13
  • May #Wheat   +6 1/2
  • Apr #Cattle  Steady-Lower
  • Apr #Hogs    Steady-Lower
  • Jun Dlr     +.09
  • Jun S&P     +4.25
  • May Crude   +.67
  • Jun Gold    +1.20

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Finding Support on Light Volume

Apr 05, 2013

Good Morning! Steve Georgy with early morning comments for April 5, 2013 at 5:10 am. We are seeing a slight bounce this morning from the idea that we have over done prices. May corn is down 63 cents so far this week and fell 31 cents last week. We could get a push higher today but the trade is still concerned with the Quarterly Grain Stock numbers from a week ago. Last year, on this date, May corn closed at 6.58 and we had a carryout number of just over 800 million on the April Supply and Demand report. We currently have a carryout of 630 million but we know that USDA will make adjustments. The quarterly stock number had seen an increase of close to 400 million bushels. USDA will give us a new breakdown next Wednesday. Bird flu is still the biggest concern in the soy complex and continues to drag prices lower. Exports yesterday were light for beans and continue to show that China hasn’t been buying like they have in the past. We usually see exports shift to South America this time of year and we could be getting that switch as Brazil and Argentina get deeper into harvest. Wheat has been strong the last few days and could continue to strengthen if we see China buying wheat. No new exports were reported yesterday but all eyes will be watching at 8:00 this morning to see if 500K tonnes of wheat was sold to China. Wheat is up about 7 cents for the week while corn and beans have broken hard. The dollar is up this morning and should be watched close after having a big rally yesterday and giving back all its gains before the close. The strength came from Japan announcing a huge $1.4 trillion Quantitative Easing program. Also the ECB yesterday stated that they are still going to keep interest rates low and the Euro sold off from that news. If the dollar rallies, commodities tend to find pressure just as if the dollar falls, commodities are supported. Cattle are higher with talks that cash cattle are remaining steady with last week. Box beef yesterday had choice up .24 (191.72) and select down .36 (188.25). If you are not a subscriber to the Allendale Advisory Report I suggest you should sign up today. We expect some volatile markets as we move into the summer and you want to be in touch.

Markets as of 5:12 AM

  • May #Corn    +1 1/2
  • May #Beans   -10
  • May #Wheat   +1 1/4
  • Apr #Cattle  +.05
  • Apr #Hogs    +.10
  • Jun Dlr     +.05
  • Jun S&P     -4.25
  • May Crude   -.30
  • Jun Gold    +2.80

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Grains are Finding a Lower Start this Morning

Apr 04, 2013

Good Morning! Steve Georgy with early morning comments for April 4, 2013 at 5:01 am. Corn has tried to find strength over the last few days but has not been able to push higher. We are still seeing negative price movement due to residual selling from last Thursday's report. The numbers were bearish and could remain that way until we get a better look at the breakdown on the Supply and Demand report next Wednesday. Beans are a little concerning now that the market is talking about a Bunge soy plant in Kansas shutting down. This may indicate that we could see a downturn in crush and may keep a negative tone over the beans. We are also hearing talks of bird flu in China. This will have a negative impact on bean imports until they get this under control. Wheat has been very strong over the last few days and managed to have a 25 cent rally yesterday. The rumor that was circulating is that China bought 500K tonnes of US wheat. This has not been confirmed yet but the trade will be watching the news wires around 8:00 to see what gets reported this morning. Weekly grain exports will be released this morning at 7:30. The trade is expecting corn to be between 175,000 tonnes and 450,000 tonnes, beans between 300,000 tonnes and 625,000 tonnes, and in wheat they are expecting 400,000 tonnes to 700,000 tonnes. The dollar is strong this morning after dropping more than 60 cents in the last two days due to weaker than expected private sector jobs numbers. This strength may keep a negative tone across commodities this morning. Cattle are higher this morning as yesterday’s chatter continued to see hopes of steady to higher cash trade this week. If you are not a subscriber to the Allendale Advisory Report I suggest you should sign up today. We expect some volatile markets as we move into the summer and you want to be in touch.

Markets as of 5:01 AM

  • May #Corn    -2
  • May #Beans   -3 1/4
  • May #Wheat   -3 1/4
  • Apr #Cattle  +.32
  • Apr #Hogs    +.25
  • Jun Dlr     +.60
  • Jun S&P     +7.25
  • May Crude   -.05
  • Jun Gold    -10.00

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Markets Quiet Down For The Moment

Apr 03, 2013

Good Morning! Paul Georgy with early morning comments for April 3, 2013 at 5:01 am. Grains futures are mixed. A much quieter session overnight as the world returns to work. Europe returned yesterday and Argentina returns from holiday today. Funds slowed down their activity yesterday, only selling an estimated 6,000 corn contracts, while being was even in the soybean complex and buying 3,000 wheat . Traders now believe that cash trade is the key to finding a bottom in the corn market. Basis firmed at rail locations and central IA ethanol plants, however CIF basis was steady. Demand for US corn is dismal mainly because of price. South Korea bought 1 cargo of corn out of Argentina at $30.00 under US prices. Comparing the value of soybeans at the Brazilian port of Paranagua to the US Gulf, Brazilian beans are $1.00 per bushel cheaper. Trade is starting to realize that the Brazilian port delays are improving. Oil World said in a report, "Brazilian exports have started to pick up and it can be expected that the worst of the export delays is over." Argentina has resumed shipping soybeans to China. We are not the only market anymore. The weather forecast is for 1+ inch of rain in TX and OK this weekend which should be beneficial to wheat and any planted corn. The Midwest is expected to warm up with rain which should warm up soil temps very quickly. It is likely there will be some corn planted in Southern IL and IN before the rain arrives. Don’t expect any USDA planting progress reports until April 15. You can see and hear clips from the Allendale Strategy Session Meeting by clicking on the link or going to our Nelson's Notes page. Boxed beef values showed some improvement on Tuesday. Choice was up .89 and select was up .91. Livestock futures were hit with selling yesterday as money moved out of commodities into the stock market which made new all-time highs. Pork cutout values were down 1.05. The feeder cattle index was steady at 138.69. Product demand is still the key to rallies in the cattle and hog complex. If you are not a subscriber to the Allendale Advisory Report I suggest you sign up today. We expect some volatile markets as we move into the summer and you want to be in touch.

Markets as of 5:01 AM

  • May #Corn    +3 1/4
  • May #Beans   -3 1/4
  • May #Wheat   +8 1/4
  • Apr #Cattle  +.22
  • Apr #Hogs    -.12
  • Jun Dlr     -.03
  • Jun S&P     +2.75
  • May Crude   -.40
  • Jun Gold    -7.50

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Traders Already Looking To Supply And Demand Report

Apr 02, 2013

Good Morning! Paul Georgy with early morning comments for April 2, 2013 at 4:45 am. Grains futures are higher on short covering after a record two day slide in corn prices. When will the liquidation of longs in the old crop corn be complete? The nearby corn futures have fallen over 90 cents in 2 sessions. A large financial institution has lowered their price projections dramatically after the USDA report last Thursday. Traders are concerned that the USDA will add the 400 million bushels to last month's ending stocks and get a carryover of 1 billion bushels for corn on the April S & D report. Allendale’s analysis suggests the USDA will likely add only a portion of the increase which could be viewed as friendly on April 10. The immediate problem is liquidation of longs in the old crop corn and the old crop/new crop spreads. Money management and margin liquidation has its hands around the throat of the bull. Funds were estimated to have sold 35,000 corn contracts, 6,000 soybeans and 4,000 wheat contracts on Monday. Corn trading limit reverts back to 40 cents today. Farmer selling of cash corn and soybeans has come to a complete standstill on this selloff in futures. Nationally, wheat conditions improved by 1% compared to the 33% G/E which was the last number from USDA. The National Weather service has warmed up the forecast for the Midwest which should allow for planting to begin later this week in Southern IL and IN. Feeder cattle is the bright spot in the livestock sector. The lower feed price outlook has given hope to the cattle feeder. Choice beef was up 1.48 on Monday as retailers restock coolers and prepare for a possible better weekend for a cookout. Select beef was down .07. Pork cutout values were up .75. The feeder cattle index was 138.13 on Monday. The Allendale Advisory Report has the complete details and analysis to help you implement your trading strategies.

Markets as of 4:45 AM

  • May #Corn    +7 3/4
  • May #Beans   +9 1/4
  • May #Wheat   +6 3/4
  • Apr #Cattle  +.25
  • Apr #Hogs    +.05
  • Jun Dlr     +.01
  • Jun S&P     +6.00
  • May Crude   +.08
  • Jun Gold    -2.80

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

Old Crop New Crop Spreads See More Liquidation

Apr 01, 2013

Good Morning! Paul Georgy with early morning comments for April 1, 2013 at 5:00 am. Grains futures are lower in reaction to last week’s USDA reports. The USDA surprised the trade on Thursday with the 5.4 billion bushel corn quarterly stocks when the average estimate was 5.03 billion bushel. If you added the extra 400 million bushel to the last USDA Ending Stocks report it would suggest a 1 billion bushel carryover for 2012/13. We do not believe that is an accurate assumption but Rich Nelson will be updating our projection today. You will get all the details in the Allendale Strategy Session. The CFTC Commitment of Traders report showed that funds continued to build their long positions in corn and soybeans ahead of the report as net longs grew by 47,000 and 17,000, respectively. Weather forecasts have taken a negative twist as temps warm up much quicker than early thought. Argentina should receive additional moisture this week. The USDA will be giving us crop conditions for wheat this afternoon. Fieldwork is already beginning in West Central Indiana over the weekend. We thought once the Prospective Planting and Quarterly Stocks reports were released, the trade would be changing focus to weather conditions for corn planting in the Midwest. However the technical damage done to the chart picture could lead to more liquidation unless a quick turnaround occurs in old crop futures. Liquidation of old crop/new crop corn could support the Dec corn for a few sessions. Livestock futures were supported on Friday by prospects of cheaper feed values. Boxed beef values did not provide any support on Friday as choice was down .02 and select was down .46. We could see some improvement this week as first of month featuring, a warmer weekend ahead and post-holiday retail counter restocking provides support. Pork values were up .15 on Friday. We would have to call the livestock markets firmer for opening. Subscribe today to the Allendale Advisory Report.

Markets as of 5:00 AM

  • May #Corn    -39 1/2
  • May #Beans   -13 1/2
  • May #Wheat   -10
  • Apr #Cattle  Stdy-Hghr
  • Apr #Hogs    Stdy-Hghr
  • Jun Dlr     -.09
  • Jun S&P     -2.75
  • May Crude   -.53
  • Jun Gold    +4.20

 

Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

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