Trade Prepares for USDA Report
Feb 09, 2012
Good Morning! Paul Georgy with early morning comments for February 9, 2012 at 5:00 am. Grain prices are slightly lower ahead of the USDA report due to be released at 7:30 am. The macro market is waiting for official announcement that the Greek government and the private investors have come to an agreement. The EU Finance Ministers are meeting today to decide if they are ready to accept the agreement and provide the money necessary to keep Greece from defaulting. The market moving news will be released at 7:30 this morning when USDA gives us supply and demand figures for February. The trade average estimate for corn ending stock is 797 million bushel compared to last month of 846 million bushel. Allendale is estimating 803 million bushel ending stocks for corn. Trade estimate for soybeans is 269 million bushel verses 275 and wheat the trade is looking for 868 versus 870 million bushel. The other two numbers of interests are the Argentina corn production; trade is thinking it should be 22.5 mmt versus USDA last month of 26.0 mmt. The USDA had Brazilian soybean production last month at 74.0 mmt and trade is thinking it should be 71.7 mmt. Remember you have until 7:15 to adjust your grain positions before report. Cash cattle trade is at a standstill however it seems the packers will have to pay up to get cattle this week. The strength in futures and improving cutout values combined with tight market ready supplies should give feedlots the stronger hand. Choice beef was up .88 and select was up 1.37 on Tuesday. Pork cutout values were down by .13 yesterday afternoon. The report at 7:30 will have an impact on livestock prices and likely the spreads between nearby and deferred futures contracts. Listen to the "Morning Coffee
" YouTube presentation and we will update and give a reaction to the report by 8:00 am. Subscribe today to the Allendale Research Center for a special low price of $250 for one year Call 800-262-7538. Meet us in Carrington ND
on February 24, 2012 for more info and free signup click HERE
Markets as of 5:00AM
Corn -2 to -3 Live Cattle -20 to -40 US Dollar Index -.12
Beans -1 to -2 Lean Hogs -10 to +20 Crude Oil +.55
Wheat -1 to +2 S&P Index -2.25 Gold +4.50
Allendale Advanced Charts
Cattle closed in the middle of the range today and near the middle of current sideways trading range. Support remains at 127.85 while resistance crosses at the contract high of 129.75.
Nelson Notes from the desk of Rich Nelson
The farming organization, UGP, estimates this spring’s soybean crop will total 4.6 million tonnes. That would be down sharply from last year’s 8.4 mt production. This is also sharply lower than USDA’s 7.6 mt.
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.