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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.

China Signs Deal To Purchase Soybeans

Feb 16, 2012

Good Morning! Paul Georgy with early morning comments for February 16, 2012 at 5:00 am. Grain markets are lower on spread unwinding and profit taking. Overnight markets have a risk off attitude. The EU and Greece battle continues with a lot of talk and political positioning. The EU ministers are scheduled to meet on Monday with the hope of a decision on the release of the $132 billion to Greece. The Chinese Delegation made an announcement in Des Moines, IA on Wednesday afternoon that they will buy around 8.62 mmt of soybeans in 2012/2013. They are expected to sign another memorandum of understanding today in Los Angeles which will bring total commitment to purchase more than 12 mmt of soybeans. This is a record purchase but in line with trade estimates. Weekly export sales will be released this morning at 7:30 am. The estimated ranges are: corn 600 to 950 tmt, soybeans 500 to 900 tmt, wheat 500 to 750 tmt. The markets will be closed Sunday night and Monday and will reopen Monday night at 6:00 pm. The USDA Outlook Forum is on Feb 23 and 24 where we will get their estimates on planted acres for 2012. Cattle trade is at a standoff although we heard a pen of cattle traded in the south for 123. Offers are 127 to 128 with very little interest from packer. Their cutout was help a bit today as choice beef was up 1.43 and select up 1.68. Futures reversed on Wednesday after making new highs however buying has come back to the market overnight. Pork cutout values were up sharply on Wednesday adding 2.41 of value. Futures will likely be supported because the strength in product. Sign up today and reserve your free seat for our Allendale 2012 Road Series meeting in Carrington, ND and Riverside IA.
Markets as of 5:00AM
Corn    -2 to -3                        Live Cattle     +30 to +50                  US Dollar Index         +.34
Beans -7 to -8                                   Lean Hogs      +60 to +90                  Crude Oil                    -.51
Wheat -1 to -3                        S&P Index      -4.50                            Gold                            -7.80
Allendale Advanced Charts
Corn finished below the 100 day moving average with next line of support at 6.24 the 50 day averge. The up trend support line crosses at 6.10 on Thursday.
Nelson Notes from the desk of Rich Nelson
The National Oilseed Processors Association reports January soybean crush at 142.813 million bushels. This was a little less than expectations of 144.5 million and may be considered a little disappointing. Though the year to date (Sep – Jan) marketing year total is down 4.9% versus last year we will point out January levels were only 1% smaller. Crush needs to run equal with last year from February to August to meet USDA expectations.
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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