Waiting for USDA Supply and Demand on Friday
Dec 08, 2011
Good Morning! Paul Georgy with early morning comments for December 8, 2011 at 5:10 am. We want to thank Nancy, Mark and everyone at the Farmers State Bank in Albert Lea, MN for their hospitality and successful meeting. Grain futures are lower as we wait for information out of EU and USDA. We will be receiving the weekly export sales numbers at 7:30 this morning. Estimates for corn are 300 to 500 tmt, soybeans 400 to 700 tmt, and wheat 300 to 600 tmt. European leaders are scheduled to meet at the Euro Summit on Friday. Pressure is on them to work out a plan to save their economies. Demand is a big part of the equations that is pressuring the grain futures. Unless we get a surprise purchase by China, prices will likely struggle into year end. Brazil is receiving moisture in areas which were dry and Argentina should get rain starting this weekend. We will need an injection of confidence from Europe or a few large sales to rekindle buying of futures. Beef cutout values were higher on Wednesday with choice up .69 and select up .88. Cash cattle trade has been at a standstill so for this week. Pork cutout values were lower on Wednesday. Lean hog futures have consolidated near the 200 day moving average. Call us today to sign up for the Allendale Ag leaders Conference on Jan 20 and 21, 2012.
Markets as of 5:10AM
Corn: 4 to 6 lower Beans: 3 to 5 lower Wheat: 6 to 8 lower
Live Cattle: 15 to 20 higher Lean Hogs: 20 to 30 lower
Dollar: .01 lower Crude: .24 higher Gold: 4.70 lower
Allendale Advanced Charts
Beans settled higher on the day, but the trading range was narrow and still within the bigger sideways range seen over the past few weeks. Support remains down at 11.02 3/4. See trade recommendation in Allendale Advance Charts.
Nelson Notes from the desk of Rich Nelson
Wednesday’s weekly ethanol production report was a record breaker! Production last week averaged 954,000 barrels per day. That cleanly broke last year’s 939,000 record week. Producers are still pushing production at extremely high levels before the end of the blending subsidy at the end of the month. Since September 1, the start of the new marketing year, production has run 2.5% over previous year. USDA’s latest estimate is for a slight decline in production this year (5.021 billion bushels 2010/11 vs. 5.000 billion for 2011/12).
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