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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.
 

Grain Markets Respond to Headlines

Nov 29, 2012

Good Morning! Paul Georgy with early morning comments for November 29, 2012 at 5:10 am. Grains futures are higher as the dollar weakens. The uncertainty of the "fiscal cliff" negotiations in Washington and the actual implementation of the EU’s Greek bailout plan are keeping traders on edge. News headlines are going to be a market mover until a solution is found in Washington. Weekly export sales report will be released at 7:30 this morning. Trade estimates are: corn 450 to 650 tmt, soybeans 500 to 750 tmt, soymeal 150 to 250 tmt, soyoil 100 to 200 tmt and wheat 400 to 500 tmt. Traders are becoming more concerned about Brazil’s ability to ship a record crop of soybeans out of its ports which are already backlogged with corn movement. Nearly 70% of grain is moved by truck in Brazil and new legislation is mandating driver’s rest time. Government officials in Brazil are saying it may take 4 to 5 years to fix all the logistical problems. Ethanol production report yesterday showed a decline of 14% compared last year. The USDA corn usage numbers are suggesting a 10% decline year over year. The NOAA moisture graphs show that the western corn belt is 9 to 15 inches deficient of rainfall. We have been asked the question "How much of US sold grain has not yet been shipped?" Rich Nelson says corn stands at 40%, soybeans at 50% and wheat at 72% not yet shipped. Reuters reported that Barclays is considering quitting trading in agricultural commodities due to reputational risk. If so, they would join several German banks that have restricted investments in Ag products this year. USDA says soybean insurance premiums will be 6% lower than last year. Central IL bean basis fell 5 cents while corn basis improves along IL River. First notice day for the Dec contract tomorrow morning. Cattle packers are operating on a negative margin. Early week trade was a few cattle in Texas at 128. Packers have since reduced bids to124 and feedlots are asking 130. Beef prices have not strengthened as quickly as expected post-Thanksgiving. Choice beef was up .39 and select was up .93 on Wednesday. Pork cutout value was up .74 which has supported hog packer margins. Get all the price outlooks for 2013 at the Allendale Ag Leaders Conference on January 25 and 26, 2013. Reserve your seat TODAY
 
Markets as of 5:10 AM
Dec Corn    +2
Jan Beans   +8
Dec Wheat   +1 1/2
Dec Cattle +.10
Dec Hogs    +.20
Dec Dlr     -.21
Dec S+P     +8.50
Jan Crude   +1.09
Dec Gold    +7.50
 
Allendale Advanced Charts
Live Cattle has slowed down its sharp impulsive rally over the last few days. Any weakness should first be approached as a correction in a bull market…Frank La Placa
 
 
 
Nelson Notes from the desk of Rich Nelson
An executive with Zen-Noh, Japan’s National Federation of Agricultural Co-Operative Associations, suggests corn imports from Brazil from their members will total 30% of all imports in the marketing year ending March 31. This is up from last year’s 6% share. US corn imports will fall from 86% of all imports to only 57%. This decline will mean actual imports of US corn will decline from 8.9 million tonnes to 5.7.
Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com
 
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