Heat Takes Visible Toll on Corn Crop
Jul 09, 2012
Good Morning! Paul Georgy with early morning comments for July 9, 2012 at 5:15 am. Corn and soybean futures are sharply higher. The week ahead could provide some moisture to the Midwest but the benefit will come in cooler temps. "It seems the second week has been advertised wetter every week since the drought began and that is largely true. However, World Weather, Inc. is a little more encouraged by the opening of the Gulf of Mexico and a subtropical high pressure system in the Atlantic that is relocated back into a more traditional position." The crop conditions report this afternoon is expected by traders to fall sharply. Many are looking for an 8 to 10% drop in the G/E category. On Wednesday of this week the USDA will give us a yield number which traders will likely use to forecast lower yields. The demand side of the equation is getting no attention right now. But one would have to expect a slow down due to the increase in price. Headlines out of EU will have a smaller impact on grains until rain covers the cornbelt. Livestock markets are being impacted by the record heat and high grain prices. Boxed beef prices were lower on Friday with choice down .92 and select down 1.13. Pork cutout values were down .51. Meat demand usually slows down as we move toward the end of July. Listen to the "Morning Coffee" on YouTube before 8:00 am.
Markets as of 5:15 AM
Jly Corn +21 3/4
Jly Beans +35 1/4
Jly Wheat +13 1/2
Aug Cattle stdy-hgr
Jly Hogs stdy-hgr
Sep S&P -6.50
Sep Dlr -.07
Aug Crude +.34
Aug Gold +3.10
Allendale Advanced Charts
Friday’s inside day in Dec. Corn does show a market that is slowing down at higher prices. Ultimately, the next move in Dec corn will come down to the gap that is left between $6.75 and $6.85. If we see the gap filled then it is safe to assume that we have an exhaustion gap on the chart and the market should turn if it is indeed a breakaway gap we will not see the gap filled and it projects to $8.46.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
The government’s monthly employment report came in a little disappointing. 80,000 jobs were added to the non-farm payrolls number in the month of June. That was below trade estimates calling for a 90,000 increase. In each of the past three months, under 100,000 jobs were added.
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