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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.

Bargain Hunters Support Grains

Nov 13, 2012

Good Morning! Paul Georgy with early morning comments for November 13, 2012 at 4:40 am. Grains are higher as buyers look for bargains after the sharp sell-off. Can "Turnaround Tuesday" stop the selling in the grain futures? Yesterday the markets were flooded with technical selling when soybeans could not hold the 200 day moving average and December corn could not maintain the 7.32 support level. Fundamental news has not changed significantly. South American weather is not ideal but improving. South American analysts put Brazil soybean plantings ahead of the 5 year average while corn planting is only 61% versus 74% last year. The US crop conditions report will be released this afternoon with wheat good/excellent possibly dropping another 1%. Corn harvest should be 99% complete and soybean harvest 98% done. With the markets closing below key support areas, technical traders will now be looking for rallies to sell. However, fundamental traders will be looking for positive news to stop the slide. Exports will be the area to watch as US corn is now within $10.00 per tonne of being competitive to Japan. Gulf basis jumped yesterday as lower prices stalled farmer selling. The Mississippi River navigation problem between St. Louis and Cairo is being lobbied in Washington. The US financial problem will take front and center starting Friday as the President calls leaders together to work on cutting the budget by $1.2 trillion. Livestock traders are looking at the weaker grain prices and wonder if they should believe it or not. Packer margins are deep in the red and they are not willing to show their hands although beef product values are expected to improve after Thanksgiving. The next 2 weeks could provide the highest weekly pork production for the 4th quarter. Boxed beef was higher on Monday with choice up 1.43 and select up .15. Pork cutout values were down .90.
Markets as of 4:40 AM
Dec Corn    +6 1/4
Jan Beans   +10
Dec Wheat   +4 1/2
Dec Cattle -.02
Dec Hogs    +.22
Dec Dlr     +.14
Dec S+P     -9.00
Dec Crude   -.63
Dec Gold    -4.20
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Allendale Advanced Charts
Yesterday Jan Soybeans continued its epic collapse with a new leg lower stopping just shy of old resistance turned support at the $14.00 level. Due to the extreme trendiness with which the Soybeans are making its lows, we are recommending only short exposure or a full hedged position in the Soybeans…Frank La Placa
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
US: The centerpiece of USDA’s Friday report was the revision higher of this fall’s soybean production forecast. Yield was increased from 37.8 to 39.3. This allowed for them to make all the bullish changes to demand you could ask for and still have enough supply left over. This was a clear psychology changer for soybeans.
Contact Allendale: 800-262-7538
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