Index Funds Roll and London Back to Work
Jun 06, 2012
Good Morning! Paul Georgy with early morning comments for June 6, 2012 at 5:10 am. Corn and soybean futures prices are higher as risk-on mentality spreads across commodity sector. The dryness in the forecast for the next few days has traders very tentative about pressing new crop futures. World Weather Inc. believes, ‘…A greater than usual amount of rain will likely evolve in the northern half of the Plains and upper Midwest early to mid-week next week with the precipitation losing some of its intensity as it moves east across the Midwest in time. The outlook should still present rain to most areas that will experience net drying this week and the end result will be improved crop and field conditions for many areas." The farmer strike in Argentina is now spreading to become a one week national strike. This could play havoc with sales out of SA. However with the backlog in shipment out of that region there may be little impact. The Goldman roll is due to begin this week and stretch for 5 days. However the real focus is on the USDA Supply and Demand report due to be released Tuesday, June 12 at 7:30 am is the ending stocks for corn and beans as well as the yield the USDA is using in their balance sheet. Allendale will be releasing our estimates tomorrow. Central IL cash corn basis is .70 over July in some places. London is back today we would expect to see more headlines on the EU financial crisis and more volume in the ag futures markets. Traders are concerned about the boxed beef values will slip sharply going into the end of June. There is a strong seasonal pattern which suggests beef product values fall starting in mid-June usually after the retailers have their needs bought for the July 4th
holiday. Boxed beef on Tuesday was lower with choice was down 1.22 and select was down .34. Pork traders are struggling with the cash discount to June futures. Pork cutout values were down .21 on Tuesday. Stay in touch with Allendale Research Center
for more insight on what is happening in the markets as we near the USDA June Supply and Demand Report.
Markets as of 5:10 AM
Jly Corn +6
Jly Beans +16
Jly Wheat +6 1/4
Jun Cattle +.40
Jun Hogs -.20
Jun S&P +11.00
Jun Dlr -.28
Jun Crude +.77
June Gold +17.60
Here are just a few of the reports we follow and record historical data on:
Allendale Advanced Charts
July Lean Hogs have continued their journey higher. At this $91.00 level we have seen three sessions of balanced trade. This market has a decision to make in the next few sessions. If we close above Monday’s high we should make an attempt at $94.87. If we fail below Friday’s low we could make a run at the $83.72 low.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
Corn ratings were left unchanged at the previous week’s 72% good to excellent rating. The trade was expecting a 1% decline. Iowa fell 2%, Illinois was left unchanged, and Nebraska fell 4% from the previous week.
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.