Macro Concerns Drag Commodities Lower
Jun 01, 2012
Good Morning! Paul Georgy with early morning comments for June 1, 2012 at 5:10 am. Corn and soybean futures are mostly lower as we start a new month. May was not a good month for the investors as July Beans were down 1.65 and July corn was down .79. The crude oil was down 18.73 and the Dow finished 820 lower than on April 30. The large long positions by funds in the soybeans have traders comparing this liquidation potential to the sell-off of 2008 and 2009. Export sales estimates for this morning are: corn 450 to 650 tmt, soybeans 450 to 700 tmt, soymeal 100 to 150 tmt, soyoil 10 to 20 tmt, wheat 350 to 500 tmt. USDA is looking for 2011/12 soybean exports to end the year (August 31) 12% lower than last year. Year to date exports are 13% lower. Brazilian corn prices have fallen to where it pencils the possibility of bringing corn into the US. Not likely as Brazilian ports are backed up for several months. The EU economic troubles continue to simmer. Greek elections set for June 17 are too close to call and Spain’s banking issues are dominating the headlines. Funds moving positions out of nearby contracts started yesterday. This will likely keep pressure on the July contracts. Cash cattle traded in NE at 1.00 higher than last week on dressed bases. Boxed beef were mixed on Thursday with choice up .31 and select was down 1.05. The lean hog futures have taken out chart resistance level as we expect a strong close for the week. Pork cutout values were up 1.17 late yesterday. Stay in touch with Allendale on twitter or subscribe to Allendale Research Center. Listening to the Allendale "Morning Coffee"
on YouTube at 8:00AM.
Markets as of 5:10 AM
Jly Corn +2
Jly Beans -8 3/4
Jly Wheat -2
Jun Cattle +.50
Jun Hogs +.07
Jun S&P -16.75
Jun Dlr +.30
Jun Crude -1.65
June Gold -10.30
Here are just a few of the reports we follow and record historical data on:
Allendale Advanced Charts
Yesterday’s impressive strength in the June Hogs has taken out resistance at the 5/18/12 pivot high of $87.95. Contributing to the change in trend is the fact that the downtrend line that has capped the June Hog market for the last 3 months has also been violated. This 5/18/12 high should now be considered support is the key level this market must stay above in order to maintain bullish momentum.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
After a 20 month review the Food and Drug Association denied the Corn Refiners Association request to label high fructose corn syrup as "corn sugar". The agency indicated the move could confuse consumers and may pose a health risk to those with fructose intolerance. HFCS production accounts for 4% of total corn use.
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.