Weather Market Still Alive
Jul 13, 2012
Good Morning! Paul Georgy with early morning comments for July 13, 2012 at 5:15 am. Corn and soybean futures are sharply higher as traders wait to see rain. The technical reversal on Wednesday could not withstand the weather market. The conflicting forecasts coming out of the Euro and GFS models continue to fuel the buying in grains. Drew Lerner from World Weather Inc. says, "…The bottom line remains one of serious concern over declining corn and soybean production potentials in the central and lower U.S. Midwest. The region of greatest declining production potential is now in the southwestern Corn Belt from Kansas, Missouri and a part of Illinois into Iowa, Nebraska and a part of South Dakota. Temperatures will trend warmer next week, but will not be as hot as those of this past week. Some periodic relief to dryness is possible in a few locations in the Midwest periodically as scattered showers evolve, but most of them will be too light and localized to seriously change soil and crop conditions…" Technicians are looking at the highs made on Wednesday in grains as the level which will negate the big day reversal. Watch weekend weather forecasts as the day progresses. Cash cattle traded $2.00 lower in the south with the dressed trade in NE $4.00 to $5.00 lower. Boxed beef values were lower again on Thursday. Choice was 1.78 lower and select was down .24. We were happy to see the release of new export data. For the month of May, US pork exports were 10% higher than last year. Imports for the month were 3% lower than last year. This is good news and shows we were able to shove out much of that oversupply in available hogs that hit during that month. Looking at the chicken data, we have good news to report as well. US chicken exports in May were 6% higher than last year. Pork cutout values were down only .06 on Thursday. Subscribe today to the Allendale Research Center
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Markets as of 5:15 AM
Dec Corn +13
Nov Beans +24 3/4
Sep Wheat +16
Aug Cattle -.22
Aug Hogs -1.10
Sep S&P +4.75
Sep Dlr -.05
Aug Crude +.67
Aug Gold +14.50
Allendale Advanced Charts
Yesterday’s trade in Aug. Lean Hogs may have set up what could be a short term rejection pattern. While it looks like a rejection from the highs of today’s bar we must remember that buyers were present at this level and unless the low is taken out, sellers have a false sense of security at this level. We still must be aware though of the downtrend line that has capped this market since the pivot high of $96.32 1/2 was established on 7/02.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
New crop stocks were lowered from 1.881 billion to 1.183 billion bushels. Expect the August report to have another production drop when USDA recognizes their harvested acres estimate is too high.
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.