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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.

Trade Waits For USDA Report Results

Dec 10, 2013

Good Morning! Paul Georgy with early morning comments for December 10, 2013 at 4:30 am.  Grain futures are mixed as traders adjust positions going into the USDA report later today.

The December USDA Supply and Demand report is the focus of the trade as we approach the 11 AM release time. The trade average is for a reduction of 17 million bushels in soybean stocks however many analyst believe it could be even larger. The current pace of soybean exports and the USDA announcement yesterday of more purchases by China when many were expecting cancellations has bulls feeling good. Be aware that 5 out of the last 6 years final demand did not meet USDA Dec estimate.

The recent import issue with China over the contamination of corn shipments with an unapproved GMO strain has traders less confident in a large change in ending stocks estimate on today’s report. Remember the USDA will not change the production number, they will wait until January for those adjustments.

Traders will be watching world numbers, more specifically adjustments in the Brazil and Argentina corn and soybean production. Analysts out of those countries have increased soybean and corn production because of favorable weather conditions.

AgRural, an analyst in Brazil is reporting nationwide soy planting advanced 4 percentage points from the previous week and was 94 percent complete as of Dec. 6.

PED disease is still spreading rapidly in Iowa and Minnesota with Nebraska now reporting cases. Feeder prices have jumped due to pig availability. December lean hog contract is staying close to cash index due to last trading day on Friday. The deferred contracts are being supported by fund buying. Pork cutout values are down .14.

Beef cutout values were higher with choice up 1.05 and select up 1.14. The strength in beef prices is providing support to the idea that packers will pay more for live cattle this week. Fund buying could provide support this week. Check in with Allendale’s YouTube updates to get Rich Nelson’s comments around noon.

Markets as of 4:30 AM

  • Mar Corn    -2 1/4
  • Jan Beans   -1 1/4
  • Mar Wheat   -3 1/4
  • Feb Cattle  -.17
  • Feb Hogs    -.07
  • Mar Dlr     -.02
  • Mar S&P     +1.50
  • Jan Crude   +1.22
  • Feb Gold    +9.30
Chart of the Day

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