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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.

Can Nov Beans Punch Through $14.09?

Sep 13, 2013

Good Morning! Paul Georgy with early morning comments for September 13, 2013 at 5:00 am.  Grain futures are mixed. Soybeans are testing 14.00 while corn and wheat are lower. Financial markets are on the defensive as traders prepare for next week’s FOMC meeting.

A big thanks to the folks at Red River Valley Farm Network for the hospitality at the Big Iron Show and to Mick Kjar from Valley News Live in Fargo, ND. And a special thanks to Gerry and Hattie Melvin for being a gracious host. This morning we are reporting from somewhere near Minneapolis, MN on the way back to McHenry, IL.

The USDA managed to give us numbers that can easily be believed and others that cause a little head scratching to justify. The pod count and pod weight used by the USDA seem to leave some room for adjustments on upcoming reports. Allendale’s analysis suggests soybean yields will get smaller by the final production report in January. Soybean futures have resistance at 14.09 and a close above that level would suggest a move to the 15.00 level. Bulls have control of the market at the moment.

USDA corn data is a confirmation that producers should be making marketing decisions on rallies. Harvest reports continue to come in from the southern half of the cornbelt. Farmers are surprised by the larger than expected yields results from early planted corn.

The FSA will update prevent planting data on Tuesday which will be watch closely by traders.

The September contracts will go off the board today. There were 4 corn deliveries and 58 wheat deliveries against the September Futures this morning.

Goldman Sachs raised their price projection for 2013/2014 soybeans by $2.00 per bushel from 10.50 to 12.50 after yesterday’s report.

Funds bought an estimated net 16,000 soybean contracts, sold 9,000 corn contracts and bought 3,000 wheat contracts yesterday.

Japan buys 113,572 tonnes of wheat in various amounts from US, Canada and Australia.

With all the attention on the grain markets, livestock futures were moved by funds rolling positions out of nearby to the deferred contracts. Tight cash hog supplies continue to underpin the nearby futures. Pork cutout values were down 1.06 on Thursday. Cattle futures traders are waiting for cash market action. Thus far the bids and asks are several dollars apart. Beef cutout values were lower with choice down .08 and select down 1.24.

Markets as of 5:00 AM

  • Dec Corn    -1
  • Nov Beans   +2 1/2
  • Sep Wheat   +4 3/4
  • Oct Cattle  +.57
  • Oct Hogs    +.57
  • Dec Dlr     +.09
  • Dec S&P     -2.5
  • Oct Crude   -.96
  • Oct Gold    -18.60


View the Chart of the Day

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