Counting Down to USDA Report at 7:30 a.m.
Jun 12, 2012
Good Morning! Paul Georgy with early morning comments for June 12, 2012 at 5:10 am. Corn and soybean futures prices are higher. The USDA will give us a first this morning, as the Monthly Supply and Demand Report will be released while the markets are open. The USDA said they will monitor the computer and bandwidth demands during this release. But have not changed computer capacity for this report. The trade is expecting a sizable drop in old crop corn ending stocks with a minor reduction for new crop. Soybeans should show tightening supplies for 2011-12 and even tighter ending stocks for 2012-13. Remember the USDA will not give us a change in planted acreage until June 29. Crop conditions fell by 6% in the G/E rating category to 66% in corn and soybeans dropped by 5% to 60% G/E. The condition of the corn and soybeans is now below last year at this time. World Weather Inc. says: "The bottom line still provides net drying and increasing crop stress later this week and into early next week as high pressure builds up across the Midwest briefly. Relief then comes later next week with rain falling in many key crop areas at one time or another with amounts sufficient to restore favorable topsoil moisture – at least for a little while..." Funds were estimated sellers of at least 10,000 contract of corn and 3,000 beans yesterday. The macro influences in commodities seems to be taking precedence over the fundamental picture. The USDA report this morning will have its impact then traders will go back to watching headlines out of Europe and China. Weather forecast will continue to throw fuel on the fire for a few more weeks. Boxed beef was higher on Monday with choice up .75 and select up 1.01. Watch for a top in boxed beef values as we have a strong seasonal pattern suggesting lower prices starting in mid-June. Pork cutout values were up 2.59 yesterday. Check out the details of the USDA report on the "MORNING COFFEE" at 8:00am. Sign up today for the Allendale Ag Leaders Webinar which will be held on June 26th. Rich Nelson will be discussing weather with Drew Lerner from World Weather Inc.
Markets as of 5:10 AM
Jly Corn +2 1/2
Jly Beans +6 1/4
Jly Wheat +7 1/2
Jun Cattle +.45
Jly Hogs +.02
Jun S&P +9.25
Jun Dlr -.06
Jly Crude -.36
Aug Gold -4.8
Here are just a few of the reports we follow and record historical data on:
Allendale Advanced Charts
Yesterday’s inside range day in July Corn does imply that the rally attempt is beginning to slow down at the $6.00 level. A breakout either above the 6/08 high of $6.05 ½ or below the 6/08 low of $5.84 ½ is needed to imply the direction of this market in the short term.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
On Saturday a conference call was held between EU finance ministers. They agreed to lend 100 billion euros to Spain for support of its banking system. This is the fourth instance of governments, or their banks, seeking assistance from EU financial authorities. The amount, 100 billion euros, is much larger than the 40 to 90 billion that the trade thought would be realistic. This will calm fears in the EU and help limit the US dollar.
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.