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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.

Talk of China Buying Supports Nearby Beans

Jan 19, 2012

Good Morning! Paul Georgy with early morning comments for January 19, 2012 at 5:14 am. Grain futures are higher as risk-on buying provides support. There also is talk of China buying several cargoes of beans which is providing support to the nearby soybean futures. We are seeing cash markets strengthen compared to futures by as much as 8 cents in some areas. Libya bought wheat from Russia yesterday. Today, we have jobless claims at 7:30 and EIA releases Nat Gas storage at 9:30. Export sales will be out on Friday morning due to the holiday on Monday. The dollar has been under selling pressure as IMF hopes to raise more money for the support of PIIGS. A G20 meeting will be held in Mexico today and Friday. The US Dollar Index price chart shows the long-term uptrend being broken overnight. A close below that level could have a positive impact on commodities. Beef cutout values were mixed on Wednesday with choice down .37 and select up .34. Packer margins are well in the red. Cash has not traded this week but offers are 125 and higher. Nearby cattle futures tried to fill the gap left from Tuesday but fell short. Yesterday’s low will now become support. Pork product continues to grind higher as cash markets are firmer. Futures appear to have made a seasonal bottom and could work higher into February. Look for good support on setbacks. Allendale’s Ag Leaders Conference is only a day away. Hop in your car and drive over to Crystal Lake IL. We will find you a room at the Hampton Inn in McHenry, IL. See you Friday at noon.
Markets as of 5:14 AM
Corn: 3 to 4 higher               Beans: 6 to 8 higher            Wheat:4 to 5 higher
Live Cattle: 10 higher to 10 lower                           Lean Hogs:10 to 20 higher
Dollar: .32 lower    Crude: 1.03 higher                 Gold: 4.50 higher
Allendale Advanced Charts
KC wheat fell sharply after breaking Friday’s low. The 40 day moving average proved to be a solid resistance level. Next support sits down at the December low of 6.35 ¼.
Nelson Notes from the desk of Rich Nelson
Argentina will be dry this week. We will point out Monday’s system, originally forecast for .25 to .75 inch has been increased slightly to .40 to 1.00 inch. Coverage is still seen widespread with 80% coverage. Dry weather is seen resuming after this system.
Contact Allendale: 800-262-7538
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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