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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.

Soybean Complex Sees Profit Taking

Jun 04, 2013

Good Morning! Paul Georgy with early morning comments for June 4, 2013 at 4:50 am.  Traders are taking some profits led by the soy complex this morning. We have three factors affecting the soybeans which are weather, technicals and tight old crop supplies. The weather forecasts have more rain moving west to east midweek and then again over the weekend. Delays in planting beans are not extremely critical for new crop production but create the concern about filling the demand for beans early this fall. Corn saw profit taking yesterday. However, when the funds get through rolling positions out of July, the tight cash supplies should again provide support. The USDA said the US farmer has 91% of corn planted and only 57% of soybeans and 80% of spring wheat planted as of Sunday. The technical picture signaled a big reversal day yesterday in corn futures. Soybeans are overbought but closed above key chart points. Trade the soy complex with caution. Cash bean basis was stronger in central IL while softer along the river. The Mississippi is closed to navigation from northern IA to St Louis due to high water. Russian wheat crop size is improving due to recent rains. The GMO wheat jitters continue while USDA investigates the origin of the problem. There has been more talk of corn acres switching to beans. Rich Nelson looked into the probability of that happening and found late planting does not impact planting switches as much as revenue per acre. Funds sold a net 10,000 corn contracts and bought 1,000 wheat and 7,000 soybean contracts on Monday. Hog slaughter was limited to 402,000 head after accounting for the transportation problem with Tyson’s Columbus Junction plant. That would theoretically back up some hogs. Not only are we approaching the tightest supply portion of the year, on top of that the numbers are not hitting the trade’s expectation for this time. On the demand side, we wonder if the cool temps next week will have an impact. Pork cutout values were up .74. Boxed beef was lower again on Monday with choice down .48 and select down 1.76. The feeder index was up 2.33 to 133.14. Listen to the Allendale’s weekly broker meeting by clicking here.

Markets as of 4:50 AM

  • Jul #Corn    -1 3/4
  • Jul #Beans   -9
  • Jul #Wheat   6 3/4
  • Jun #Cattle  -.12    
  • Jun #Hogs    +.25
  • Jun Dlr     +.11
  • Jun S&P     -1.25
  • Jul Crude   -.50
  • Jun Gold    -10.00


View Today’s Chart of the Day

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