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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.
 

Macro Market and Weather Battle for Influence

Jan 06, 2012

 

Good Morning! Paul Georgy with early morning comments for January 6, 2012 at 5:30 am. Grain markets are mostly higher overnight. Stock markets in Europe are higher and weather in South America is waiting for rain. Macro markets took center stage on Thursday as Italian banks were under pressure when their stock had to be halted from trading. Deutsche Bank and Commerzbank lost more than 4% due to liquidity concerns. The US will release unemployment data at 7:30 this morning. The macro market news will be a market mover for some time.
 
Argentina’s forecast for wet weather the 9th through the 12th should relieve crop stress in most areas. However it will not be soon enough for some crops. The next few days will intensify crop stress as dry conditions with high heat persist. Once past this rain event it looks dry again but temps should be more seasonal. The Climate Prediction Center has said they believe La Nina will continue into spring. I am sure Drew Lerner will address this issue at the Allendale Leaders Conference on Jan 20 and 21 in Crystal Lake, IL at the Holiday Inn. You will have a chance to ask him any weather question you have on your mind. Export sales will be released at 7:30 this morning. Estimates for corn are 350 to 500 tmt, soybeans 400 to 600 tmt, and for wheat 300 to 500 tmt. Livestock traders will be waiting for the export data on pork. Is China really buying US pork? As we expected choice beef was 2.56 lower on Thursday and select was down .33. We are expecting to see more pressure on beef prices and packer margins over the next few weeks. Cash cattle are still in a standoff waiting for one side to show their hand. Pork product cutouts were down .38. The Allendale Leader Conference is 2 weeks away, make your reservation today.
 
Markets as of 5:30 AM
Corn: 1 to 3 higher               Beans: 3 to 5 higher            Wheat:3 to 5 higher
Live Cattle: 5 to 10 higher                            Lean Hogs: 10 to 20 higher
Dollar: .03 lower                    Crude: .37 higher                  Gold: 3.10 higher
 
Allendale Advanced Charts
Corn finally posted a correction after closing steady to higher 11 out of the last 12 days. We have support now at the 6.34 to 6.36 level. There should be some buying interest around that level. A second lower close and below the 6.34 level would negate recent uptrend.
 
Nelson Notesfrom the desk of Rich Nelson
The state of Parana, the #1 corn producer and #2 soybean producer, lowered its estimate of crop production overnight. Corn was reduced from 7.4 to 6.4 million tonnes. Soybean production was lowered from 14.12 to 12.73 million tonnes.
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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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