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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.

Hopes Of More Good News From Employment Report

Dec 02, 2011

Good Morning! Paul Georgy with early morning comments for December 2, 2011 at 5:20 am. There is snow on the ground this morning in McHenry IL. Grain Markets were quiet overnight. Thursday’s action was a low volatility day after an extremely volatile session which doesn’t necessarily give us a price direction. The EU remains very tense with hope that a solution can be worked out between the EU and IMF. Currently the IMF is playing the tough love card by requesting reform before aid. Headlines will be watched closely as the EU Ministers will meet next Friday. The bottom line of this week’s stance by world banks to support banking systems in trouble has provided some confidence for traders. However will they become buyers of grains? There are 2 major negative factors overshadowing the grain complex. Export sales are poor. We need a large buyer to step up to the plate. Why would they be looking for US corn when current values are approximately $10 over South America corn and $9 over US SRW?  South American weather is ideal for the foreseeable future. Our weather man does not see any major crop stress at this time. No active trade in the cash cattle market as feedlots prepare for winter storm in cattle feeding areas. Cutout values continue the slide as choice is down 1.17 and select is down 1.01. Hog futures have tested the uptrend support line on Thursday while pork cutout values rebound 1.09. Traders will be watching the "non-farm" employment number due to be released at 7:30. Anyone in the Albert Lea MN area, I would like invite you to attend the 2011 Agriculture Seminar next Wednesday sponsored by the Farmers State Bank. Details can be found at Call for reservation at 507-863-2371.
Markets as of 5:20AM
Corn: 2 to 3 lower                Beans: 3 to 5 higher                         Wheat: 1 to 3 lower
Live Cattle: 70 to 90 higher                         Lean Hogs: 20 to 30 higher
Dollar: .09 lower                    Crude: .75 higher                  Gold: 15.00 higher
Allendale Advanced Charts
Altoough corn closed above the 6.00 level in the March contract on Thursday it was near the low of the session. The inside does not give us clear direction alone. However a close for the week below Wednesday’s low could open the door for more selling pressure. See trade recommendation in Allendale Advance Charts page 9.

Nelson Notes from the desk of Rich Nelson
This week’s export sales report, covering sales through last Thursday the 24th, was a little disappointing. The previous three weeks saw poor sales that were 70-75% of normal. To meet USDA hopes we should be running 30% below normal. Today’s 280,600 metric tonne sale totals 61% under normal for that week. That is not much of an improvement

Contact Allendale: 800-262-7538
There is a significant risk of loss when trading futures and options contracts. This information is not to be construed as an offer to sell or a solicitation or an offer to buy the commodities herein named, and each investor should consider the appropriateness of trading on this information, based on their objectives. The factual information of this report has been obtained from sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. Past performance is not indicative of future results.

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