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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.
 

Planting in 2013 Not An Easy Chore

Jun 07, 2013

Good Morning! Paul Georgy with early morning comments for June 7, 2013 at 5:00 am.  Grains futures are mixed in a quiet session ahead of economic data release. Planting the balance of the corn and soybean crop will not be ideal. The forecast is for open weather for a few more days before another system moves in to the Midwest. However the wet areas will need more than 2 days to ready fields for planting. Bull spreads are the feature at the CME as the touted Goldman and UBS rolls start today. Tight cash supplies of corn and soybeans should support nearby contracts. If there were any surprises on yesterday’s export sales data it came in the new crop corn where only 52 tmt sold last week.  Old Crop soymeal sales were at higher end of trade expectations which leads to concerns the USDA is understating soybean crush. Rich Nelson has said "the USDA has to raise their crush number on the balance sheet or we need to close more than 23% of processing plants for the balance of marketing year." Tight old crop supplies of both corn and beans will have an impact on nearby futures as we move into July and August. Traders are now thinking the US may have to import beans to meet balance sheet expectations. CONAB the reporting service for the Brazilian government said on Thursday that Brazil’s corn production is 78.5 mmt which 2.5 mmt more than what USDA had in last report. The Mississippi River is expected to re-open to some barge traffic today. Allendale estimates for next Wednesday’s Supply and Demand Report is outlined in the chart below.

US ENDING STOCKS                            USDA      ALDL      USDA      ALDL
in million bushels                            12/13      12/13    13/14     13/14
                          US Corn                   759        769         2004      1680
                          US Beans                 125        124           266        296
                          US Wheat                 731        734          670        686

 

Check below for the results of yesterday’s Planting Intention Question. New highs for the uptrend were reached on Thursday. Those attending the World Pork Expo got an update on the PED progression through the US. While the problem is not getting much worse, it appears we must get used to the idea that this will remain with us for the summer. Pork cutout values were down .28. Cash cattle action was quiet so far this week as the industry waits for the employment numbers. This is especially important in the beef world where consumers have had to re-orient themselves to the idea that higher prices are a "deal". Boxed beef was mixed as choice was down .77 and select was up .28. The feeder index was 133.45 on Thursday.

In Thursday’s poll, we asked, What is your strategy in regards to Prevent Plant? Here are your thoughts:

Take Prevent Plant Option–54.62%
Continue Planting Corn–28.57%
Switch to Soybeans–16.81%

 

Markets as of 5:00 AM

  • Jul #Corn    – 3/4
  • Jul #Beans   +5
  • Jul #Wheat   +1 1/4
  • Aug #Cattle  -.17    
  • Jul #Hogs    -.02
  • Sep Dlr     -.13
  • Sep S&P     +0
  • Jul Crude   +.40
  • Aug Gold    -5.00

 

View Today’s Chart of the Day

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