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The Allendale Wake-Up Call

RSS By: Paul Georgy,

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.

A Few Reports To Watch Today

May 08, 2014

Good Morning! Paul Georgy with early morning comments for May 8, 2014 at 4:30 am.  

Listen to today's Midday Weather Audio Report

Grain futures are quiet with some back and fill action. Traders will have some new news to trade today.

At 7:30 this morning the USDA will release weekly export sales data. Trade estimates are:

                                        Old                                             New
Corn                      500,000-800,000             100,000-300,000
Soybeans             -100,000-100,000             100,000-300,000
Soymeal                  50,000-150,000                        0-200,000
Soyoil                               0-20,000                          0-10,000
Wheat                    100,000-300,000             200,000-300,000

CONAB (Brazil’s crop supply agency) will release its monthly estimate for soybean production. Traders will be watching this number for indications whether farmers planted corn or soybeans as the second crop this year.

Expect traders to do some last minute adjusting of positions ahead of Friday’s USDA report which is due to be released at 11:00 am.

US Ethanol production slipped a little in the latest week. It is still a strong pace overall. We would expect to see production stabilize over the next six weeks before the end of the marketing year decline hits. Current marketing year production is 10.4% above last year. The USDA’s target is a 7.6% increase year over year.

Brazil’s largest ethanol production company is shutting 10 of its plants due to the government policy on gasoline pricing and profitability. There already have been 6 ethanol companies in Brazil file for bankruptcy since the beginning of the year.

Lebanon buys 30,000 tonnes of wheat from Ukraine. Putin’s troops still remain on the Russian boarder while many observers believe he is waiting for the results of the Ukraine election later this month.

China intends to auction 300,000 tonnes of soybeans out of government reserve.

There were another 143 contracts of soybeans delivered against May futures contracts through April 22.

China will buy more pork for the government reserves in an effort to support the hog industry. This in turn would ultimately improve corn and soybean meal prices there.

Livestock futures remain the battle between tight supplies of market ready supplies and weaker product prices. A few cattle have traded at 145 in the south and 150 in the north. Retailers appear to have their needs bought for the Memorial Day holiday and will now wait to do some fill in buying about a week before that weekend. Beef values are weaker with choice down .73 and select down .30.  The CME Feeder Index is 181.10

Technically speaking the June cattle contract had an outside day down on Wednesday, not a positive signal.

Lean hog futures are being weighed down by the premium of summer contracts to cash prices and funs rolling out of June into the July. Pork cutout values are down .32.

Markets as of 4:30 AM        

  • Jul Corn    -1
  • Jul Beans   +4 3/4
  • Jul Wheat   -6 3/4
  • Jun Cattle  +.05
  • Jun Hogs    -.52
  • Jun Dlr     -.12
  • Jun S&P     +.25
  • Jun Crude   -.36
  • Jun Gold    +2.00

 Chart of the Day

daily chart

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