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April 2012 Archive for The Allendale Wake-Up Call

RSS By: Paul Georgy, AgWeb.com

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.
 

Large Bean Deliveries Narrow Spreads

Apr 30, 2012

Good Morning! Paul Georgy with early morning comments for April 30, 2012 at 5:10 am. Corn and soybeans futures are lower. Deliveries were a surprise for traders as many were expecting no deliveries in soybeans and corn. However there were 752 beans delivered as well as 3392 bean oil and no corn or meal. Wheat deliveries were lower than expected with only 2 contracts when expectations were for sizeable number of contract. The Kansas wheat tour starts this week. We should be getting data from it later in the week. We would expect with conditions excellent, yield could be surprising large. Brazil's ABIOVE group now estimates 65.9 mmt of soybeans will be harvested in Brazil down from March forecast of 69.5 mmt. Others continue to lower South America productions. This will end soon as harvest is nearing completion. Planting progress will be released this afternoon and we are estimating corn to be 44% complete, from 28% last week. Soybeans should see 11% complete vs. 6% last week. CFTC Commitment of traders report showed managed money reduced net long corn positions by 43,511 contracts and increased soybean longs to another record position. In wheat, managed money reduced short positions by over 10,000 contracts. The bottom line funds reduced overall investment in grain commodities last week. With the sharp break in livestock futures managed money had only minor reduction in long positions. Beef cutout values fell slightly on Friday. Choice was down .47 and select was down 1.25. Pork cutout values were up .14 on Friday. Livestock will be watching the stock indexes for direction at 9:05. Stay in touch with Allendale Research 800-262-7538. Just announced were the dates for the Allendale Ag Leader’s Webinar Series, go to www.allendale-inc.com and get signed up today.
 
 
Markets as of 5:10AM
May Corn    -2
May Beans   -12 3/4
May Wheat   -6
Jun Cattle stdy-lwr
Jun Hogs    stdy-lwr
Jun S&P     -2.50
Jun Dlr     +.10
May Crude   -.67
June Gold   -1.80
 
Here are just a few of the reports we follow and record historical data on for our subscribers:
 
Allendale Advanced Charts
Corn finished the week on strong note as bulls pushed prices back above the 20 day moving average. The 50 day average would be next resistance at 6.37 in the July contract.

Our subscribers have access to technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The Bureau of Economic Analysis, a division of the US Commerce Department, released its first estimate of first quarter GDP this morning. Economic growth was seen at 2.2% over last year in the same quarter. That was lower than Q4’s 3.0% growth and also lower than the average guess of 2.5%.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

First Notice Day Creates Spread Adjustments

Apr 27, 2012

Good Morning! Paul Georgy with early morning comments for April 27, 2012 at 5:10 am. Corn and soybeans futures are higher with May contracts leading the rally. We expect spreading to be a major factor again today. Yesterday it is estimated that 70,000 May/July corn were traded. World Weather Inc.’s forecast says, "There is no risk of seriously threatening cold for wheat and corn in the Midwest and the general theme of weather continues tilted toward a boost in precipitation for the northern and central Plains and Midwest." Old crop corn basis was stronger on Thursday at export terminals due to new export demand. Buenos Aires Grains Exchange lowers soybean crop from 44 to 43 mmt. European wheat traders are concerned about the dryness in Eastern Europe with a forecast for no moisture in the next ten days. Kansas Wheat tour starts next week and we should be seeing some results on May 3rd. First notice day for May contracts in corn, wheat and soy-products is Monday. The trade is expecting large wheat deliveries. The Senate Agriculture Committee approved a proposed 5 year farm bill on Thursday that would cut subsidies and expand crop insurance. The outside markets are quiet this morning. The BSE/Mad Cow story doesn’t want to go away. The USDA is reportedly looking for offspring of the infected cow however there is no threat to food supplies. Cash cattle traded at 119 in the south as choice beef was .25 higher and select down .04 on Thursday. A strong close for the week would boost hopes for bulls. April cattle’s last trading day is Monday at noon. Pork cutout values continue to slide down .12. We would expect choppy trade going into the end of month. Stay tuned to Allendale research by going to www.allendale-inc.com.
 
 
Markets as of 5:10AM
May Corn    +4 1/2
May Beans   +8 1/2
May Wheat   +1 3/4
Jun Cattle +.02
Jun Hogs    +.02
Jun S&P     -1.75
Jun Dlr     +.03
May Crude   -.48
June Gold   -6.60
 
Here are just a few of the reports we follow and record historical data on for our subscribers:
 
Allendale Advanced Charts
Feeders attempted to rally on Thursday, but ran into resistance at the 20 day moving average. The low from two days ago at 147.85 is key support. A close below it could push markets toward 146.20.

Our subscribers have access to technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Wednesday’s weekly ethanol production report indicated production last week totaled 865,000 barrels per day. That was lower than the previous week’s 884,000 tonnes and also from last year in the same week of year at 883,000. This is rough news but slipping production rates are entirely expected by the government and the market. Unless production falls a full 4% below last year, from now through August, we will end the year over USDA hopes.
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Grains Prepare for Export Data

Apr 26, 2012

 

Good Morning! Paul Georgy with early morning comments for April 26, 2012 at 5:10 am. Corn and soybeans futures are mostly higher. The excitement of confirmed sales to China was not enough to hold corn futures up yesterday. This morning at 7:30, the USDA will give us the Weekly Export Sales. Trade estimates are: corn 800 to 1,000 tmt, soybeans 900 to 1,250 tmt, soymeal 150 to 300 tmt, soyoil 5 to 15 tmt and wheat 400 to 650 tmt. The trade is starting to pay attention to the recent drying trend in the eastern Ukraine, Russia, and Kazakhstan with no rain in the forecast for the next 10 days. US weather models have moved the cool temps further to the north for this weekend. Planting progress will likely be disrupted by measurable rain over the next 10 days. Ethanol production dipped 2% below last year in the latest week. In the 19 weeks left of this marketing year (September 1 - August 31) we need to drop to production 4% under last year for the remainder of the year in order to not beat USDA corn usage estimates. Cattle futures are showing signs of recovery after several weeks of sliding prices. The BSE/Mad Cow scare may have put in the season low but a close above 114.00 in the June is needed to give bulls some confidence. Beef prices were higher again on Wednesday. Choice was up .55 and select was up .13. Very light volume of cattle traded in TX and KS at 118 to 119, most offers are at 122. Pork cutout values were down .75. Lean hog futures continue to struggle as export demand concerns weigh on traders. The Allendale Research Team is putting together The Allendale Webinar Series. Complete details should be released by early next week. If you know of anyone who should be receiving the "Allendale Wake Call" all we need is their email address.
 
 
Markets as of 5:10AM
May Corn    +3 1/4
May Beans   +1 1/2
May Wheat   +4 3/4
Jun Cattle +.27
Jun Hogs    -.47
Jun S&P     -1.50
Jun Dlr     -.03
May Crude   -.17
June Gold   +6.00
 
Here are just a few of the reports we follow and record historical data on for our subscribers:
 
Allendale Advanced Charts
Hogs found strength on Wednesday and created an inside bar on the chart. The bulls would like to see more stable trade like this in coming sessions as it would be a sign of a bottom forming.

Our subscribers have access to technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Corn traders may have some concern about feed demand with Tuesday’s BSE announcement. Allendale research found that feedlots inventories did decrease in the initial three to five months after each of the past three findings. Interesting that USDA did not consistently drop corn for feed numbers though.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

 

Markets Rebound after Mad Cow Scare

Apr 25, 2012

 

Good Morning! Paul Georgy with early morning comments for April 25, 2012 at 5:10 am. Corn and soybeans futures are higher on weather, technicals and money flow. The weather forecast for the upper Midwest has some very cool temps over the weekend which could be supportive to futures. The question is, how far south will the cold front move? Reports out of Argentina that there was frost damage to some of their double crop beans remains a positive force to US bean prices. There was talk yesterday that China could have bought up to 1.0 mmt of soybeans. Export sales data at 8:00 AM will be watched closely for any announcements. The Brazilian corn crop continues to get larger as weather for second crop corn is excellent. We have talked to many producers in the US over the last few days that are going to plant more soybeans than earlier planned.  The increase in soybean plantings will come from many different crops not just corn. The cattle market had a mad cow scare during Tuesday’s session. Of which the USDA said it was one cow found at a rendering plant with no chance of meat contaminating the food chain. This sell-off could be the climax we were looking for to suggest a bottom in live cattle futures. A close above 114.00 in the June contract will be needed to give bulls hope of recovery. Boxed beef closed higher on Tuesday with choice up 1.37 and select up 2.22. Liquidation has pushed prices lower in all meats. Pork is due for a season rally. Pork cutout was up .21 to 77.62 on Tuesday. Follow us on Twitter @allendale_paul. Get the complete story on Allendale Research Center or call 800-262-7538.
 
Markets as of 5:10AM
May Corn    +5
May Beans   +25
May Wheat   +7
Jun Cattle +.40
Jun Hogs    +.82
Jun S&P     +9.25
Jun Dlr     -.17
May Crude   +.53
June Gold   -3.40
 
Allendale Advanced Charts
June cattle futures dropped the 3.00 limit on Tuesday breaking near term support. Today’s action could determine if yesterday’s sell off was a climax of selling or just a breakout to down side. A close above 114.00 is needed to signal a possible bottom.

 
Nelson Notes from the desk of Rich Nelson
The paperwork on the big China purchase of corn was finally received by USDA. Though classified as "unknown", it is likely the 480,000 tonnes of US old crop corn that was sold overnight was part of the rumored 500,000 to 1 million tonnes that has been discussed for the past week and a half.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

 

Grains Higher Overnight

Apr 24, 2012

Good Morning! Paul Georgy with early morning comments for April 24, 2012 at 5:10 am. Corn and soybeans futures are higher, supported by the outside markets. Cooler weather forecast provides support as the US crops get off to a fast start. USDA in the weekly crop progress report said we have 28% of the corn crop planted and 6% of the soybean crop planted. Corn emergence was 9%, way ahead of the 2% normal. IL had 21% emerged versus 1% average. We should see some excellent planting progress this week. Rich Nelson, Director of Research at Allendale looked at years where planting progress was above average. It is possible we could achieve the 50% threshold by next Saturday. There were 13 years where we beat the average planting date and in 11 out of the 13 years we beat trend yield. Long-term forecast by NOAA is projecting normal rainfall and normal precipitation for the months of May, June, and July. CFTC Commitment of Traders report from last Friday showed funds continuing to reduce long positions and increase soybean longs. Funds continue to reduce positions in commodities. This likely is the reason for consolidation in many commodities. Boxed beef values were higher on Monday with choice up .56 and select up .60. The above normal meat supplies in the freezer will hamper recovery in cash markets. The oversold condition in lean hog futures could give way to a sharp recovery when liquidation ceases. Allendale Research Center can keep you up to date on grain and livestock analysis. Go to www.Allendale-inc.com.
 
Markets as of 5:10AM
May Corn    + 1/2
May Beans   +5 1/4
May Wheat   +3
Apr Cattle +.12
Jun Hogs    +.02
Jun S&P     +3.50
Jun Dlr     -.09
May Crude   -.11
June Gold   +5.00
 
Allendale Advanced Charts
Early session break took out the uptrend and 100 day moving average, only to rebound late. The recent consolidation remains as dominant price range. Key support is now today’s low.

 
Nelson Notes from the desk of Rich Nelson
Corn planting came in under the expected 31% complete. Assuming good progress this week, we expect next Monday’s number at 51%. That would be the third earliest 50% complete number in history. There is a relationship between early planting and above trend yields.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Euro Debt Crisis Takes Spotlight Again

Apr 23, 2012

Good Morning! Paul Georgy with early morning comments for April 23, 2012 at 5:00 am. Corn and soybeans futures are lower on profit taking and stronger Dollar. The Netherlands has been unable to agree on a budget which is driving up Euro countries debt costs. Last week ended with rumors circulating that Brazil was going to halt shipments of soybeans due to their low production. Brazilian government made a statement over the weekend that they have no plans to halt or slow exports of soybeans. There was more talk last week that as many as ten cargos of beans were sold to China out of the US. The daily export report at 8:00 will be very important as we wait for some confirmation on soybean and corn sales. Spain and Argentina’s will continue to battle over the subsidiary of the Repsol (Spain’s largest energy company). Moisture has moved out of the Midwest for a few days which should allow for some aggressive planting progress. We are hearing estimates of 35 to 40% of US corn crop planted. That number seems a little high to us. There still is some frost in the forecast but it is mostly WI, and MI. It should not be a problem for corn that is already out of the ground. Cattle on feed report Friday should be a little negative for cattle futures as all numbers were less than trade was expecting. However the cold storage numbers showed a larger than expected buildup of beef. Hog futures are struggling with the talk of slow demand from China. Boxed beef on Friday was mixed with choice up .93 and select down .32. Pork cutout was up .63. Stay tune to Allendale Research by checking at www.Allendale-inc.com.
 
Markets as of 5:00AM
May Corn    - 3/4
May Beans   -4 1/4
May Wheat   -1 1/4
Apr Cattle Stdy-Lwr
Jun Hogs    Stdy-Lwr
Jun S&P     -13.75
Jun Dlr     +.21
May Crude   -.83
June Gold   -9.00
 
Allendale Advanced Charts
Soybeans rallied sharply on the close on Friday and poked above resistance at 14.54. A close above this level would project a move to 14.70 level.

 
Nelson Notes from the desk of Rich Nelson
Traders continue to suggest China is actively buying US corn. This morning the rumor is that they purchased 500,000 to 1 million tonnes of US old crop corn. If true, that could be confirmed in the coming days by USDA’s morning update. There was no confirmation this morning.
 
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Quiet Grain Trade Overnight

Apr 20, 2012

Good Morning! Paul Georgy with early morning comments for April 20, 2012 at 4.45 am. Corn and soybeans futures are higher, wheat is lower. Today will be the real test for grain futures. Can they hold onto Thursday’s rally? Any news of corn sales made to China would be a positive catalyst. If you remember, we had a bout of optimism a few weeks ago where traders were expecting a large sale of corn to China. Weekly export sales report proved otherwise. We will be watching for USDA to announce new sales at 8:00 am this morning, which could be a key market mover. Weather is still dry in the southeast but rain across the Corn Belt has made for some excellent planting conditions in IL and IN. The outside markets have not been a factor in the last few days but we think it has influenced some funds to reduce their positions in commodities. Keep an eye on the CFTC commitment of traders report this afternoon. Cash cattle traded steady to firm this week. Boxed beef value posted another day of higher prices. Choice was up 1.32 and select was up .87. Pork cutout was up .93 on Thursday. Futures need a strong weekly close to give us some indication that we have made a seasonal low. Today is the last day we are offering the Allendale Research Center for only $99.00 for 6 months.
 
Markets as of 4:45AM
May Corn    +1 3/4
May Beans   +2 1/4
May Wheat   -2 3/4
Apr Cattle +.70
Jun Hogs    -.05
Jun S&P     +2.75
Jun $ Ind   -.15
May Crude   +.35
June Gold   +1.00
 
Allendale Advanced Charts
Corn rebounded on Thursday and closed above the previous day high. This was a key close for bulls as they are flirting with key support at 5.91. A follow through strong close is needed to keep momentum going.

 
Nelson Notes from the desk of Rich Nelson
Sales: Another big disappointment in export sales for corn in both old crop and new crop (which was a net negative number). Sales were down 69% vs. last week. For the marketing year, corn is in danger of falling behind USDA’s annual target, though we will note, sales could continue to come in below the five-year average by about 8% and still meet USDA hopes.
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Grain Rally Led by Corn

Apr 19, 2012

 

Good Morning! Paul Georgy with early morning comments for April 19, 2012 at 5:10 am. Grain futures are higher, led by talk that China was buying old crop corn. The sharp sell-off in old crop corn futures yesterday makes US corn prices competitive in China. The oversold condition in grains has helped fuel the overnight jump in prices. The outside markets are not providing much direction this morning as they have narrow trading ranges. Spreading will likely be a factor again today. Weekly export sales estimates are: corn 500 to 850 tmt, soybeans 650 to 1,150 tmt and wheat 400 to 700 tmt. The actual USDA data will be released at 7:30. Boxed beef values were higher on Wednesday, Choice was up 2.29 and Select was up 1.68. The reduced production and lower price has bought some buyers back to the retail counter. Pork values were down 0.22. Lean hog futures have been in a tailspin as funds build short positions this week. USDA will release the Cattle on Feed report this Friday afternoon at 2:00 pm. You have until Friday to get the "Planting Special" subscription for only $99.00.
 
Markets as of 5:10 AM
May Corn    +16
May Beans   +17
May Wheat   +12
Apr Cattle +.27
Jun Hogs    +77
Jun S&P     +8.00
Jun $ Ind   +.01
May Crude   +.36
June Gold   +2.90
 
Allendale Advanced Charts
Beans fell toward the current uptrend line on Wednesday as bears took control. In order to keep the uptrend in place we need a rally very soon.

 
Nelson Notes from the desk of Rich Nelson
Spain: Politicians are seeking to cut 10 billion euros in government expenditures. The latest cuts will come from the health care and education sectors. The country has indicated it will reduce its government spending short fall from 8.5% of GDP to 5.3% this year. Economists are concerned this cut will bring it back into recession.
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

 

Corn Plantings Give Potential to Record Yields

Apr 18, 2012

 

Good Morning! Paul Georgy with early morning comments for April 18, 2012 at 5:10 am. Grain futures are mixed this morning following weaker demand ideas in China. The USDA said that as of Sunday the US farmer has 17% of the corn crop planted. IL had 41% planted as of last week with 6% average. KY, IN, and MO are also way ahead of average. Wheat conditions improved in the Good to Excellent category by 3% and spring wheat plantings were 37% versus 5 year average of 9%. Traders are talking about big yields already as the last 2 record planting pace years 2004 and 2010 resulted in record yields for corn. Spreading has been a major feature for corn and beans in recent weeks and is likely to continue. In several conversations yesterday with farmers it appears they are going to switch acres from corn to beans. Rich Nelson, Allendale’s Director of Research told me yesterday that it is likely to see corn acres and beans acres increase this year as price spreads now are in favor of beans and weather conditions are in favor of planting corn. The USDA will not give us the official number until June 30. Price spreads between old crop and new crop soybeans are attracting buyers to new crop due to the discount. The macro economic situation is a huge concern to traders and money flow. Watch headlines for direction. Cleaning up product inventories is a problem for packers and producers. Beef values were higher on Tuesday with choice up 2.21 and select up 1.67. The slowdown in packer production is finally taking effect. Pork cutout values are still struggling as Tuesday price was down 1.10. Only a few days left to get in on the "Planter Special", CALL TODAY!
 
Markets as of 5:10 AM
May Corn    +1
May Beans   -8 3/4
May Wheat   +0
Apr Cattle +.35
Jun Hogs    -.75
Jun S&P     -1.00
Jun $ Ind   +.33
May Crude   -10
June Gold   -3.50
 
Allendale Advanced Charts
May feeders closed above the 38% retracement level suggesting a bottom is in place. Next upside target would be the 100 day moving average at 154.20.

 
Nelson Notes from the desk of Rich Nelson
Barclays Capital estimates $2.2 billion in outflows hit commodity investments in March. This offset much of February’s $6.2 billion inflow.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

 

Spain Now Center Of EU Troubles

Apr 17, 2012

Good Morning! Paul Georgy with early morning comments for April 17, 2012 at 5:20 am. Grain futures rebound from yesterday’s selloff. Spain has been in the spotlight with their debt auction causing fund managers to reduce position size and take profits on some of the record long positions in soybeans. Spain says they will not stand by idly and let Argentina seize the assets of YPF a subsidiary of Spain’s Repsol. YPF is the largest oil producer in Argentina and holds 40% of Repsol’s reserves. Financial instability around the world is causing a crack in the investor confidence. Weather reports are for scattered showers this week with another system providing good coverage early next week. The "rain makes grain" attitude has traders bull spreading corn or outright selling December futures. The USDA had a small fire which caused a delay in the release of the crop conditions and planting progress until this afternoon. We are expecting another record pace with around 20% of US corn crop in the ground. The previous record corn planting pace was made by 2 years, 2004 and 2010, which also made record yields. Cash hogs and futures are under pressure as funds liquidate livestock longs and demand sags. April hog contract went off the board at noon yesterday. The premium of May and June over the April is causing downside pressure. The demand problem we have seen in beef for several months has now moved to the pork. China’s slowing economy also tempers hopes for their aggressive buying. Wholesale beef values worked higher on Monday with choice up 2.75 and select up 3.16. Pork cutout values were up .84. Only a few days left to sign up for the "Planters Special" for only $99.00. You can find details at www.allendale-inc.com .
 
Markets as of 5:20 AM
May Corn    +1
May Beans   +7
May Wheat   +3 1/2
Apr Cattle +.02
Jun Hogs    +.25
Jun S&P     +6.00
Jun $ Ind   -.07
May Crude   +.52
June Gold   +4.10
 
Allendale Advanced Charts
The bears pressed the wheat market on Monday through support at 6.28. Next support can be found at 6.12 3/4 then 5.97 ½.

 
Nelson Notes from the desk of Rich Nelson
NOPA, the National Oilseed Processors Association, estimates March soybean crush at 140.534 million bushels. This was less than the 143.8 million bushels expected and therefore disappointing. We cannot call it disappointing as the number was 5% over last year’s March. If crush averages a mild 2% better pace for April through August, we will end with 13 million bushels more than USDA expected.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Rains Pressure Grains

Apr 16, 2012

Good Morning! Paul Georgy with early morning comments for April 16, 2012 at 5:00 am. Grain futures are lower as moisture covers Midwest. Funds bank some profits after CFTC Commitment of Traders Report where it showed Fund managers have increased their long position in soybeans to another record position. They reduced long positions in corn last week by 4% to less than 200,000 contracts. Funds continued to build short positions in wheat as they increased short positions by 33% from last week. Weather has been a factor over the weekend as most of the corn belt received well needed moisture. Some areas received more than needed as 3 plus inches fell. The rains should slow planting progress for a few days in most areas. USDA weekly planting progress and crop conditions report will be released this afternoon at 3:00 which should show corn planting on a record pace. The Euro debt crisis is waking up again and investor confidence is being shaken. We must watch headlines closely this week for new events coming out of Eurozone. Livestock futures closed out the week in volatile fashion. Live cattle were up sharply on Thursday and gave much to the gain back on Friday. Nearby lean hog futures were down the limit. The economic data out of China was a huge catalyst in the pressure in futures prices. Outside markets would suggest a lower opening in livestock this morning. Boxed beef was up 1.81 to 178.51 and select was up .57 to 177.33. Pork cutout values were down 1.81 to 77.01. This week, watch for further news headlines concerning China. The Allendale "Planting Special" 6 months for $99.00 will be available through April 20. Sign–up TODAY!
 
Markets as of 5:00 AM
May Corn    -6 3/4
May Beans   -7 1/2
May Wheat   -6
Apr Cattle stdy-lwr
Apr Hogs    stdy-lwr
Jun S&P     +5.50
Jun $ Ind   +.15
May Crude   -.16
June Gold   -8.40
 
Allendale Advanced Charts
Corn broke the 100 day moving average and the February low at 6.26 on Friday. A close below 6.26 could find an acceleration of selling pressure.

 
Nelson Notes from the desk of Rich Nelson
For weeks the trade has been discussing ideas that a cooling Chinese economy could imply lower demand for commodity goods. The overnight release of 1st quarter GDP only came out to +8.1%. That was lower than the 4th quarter’s 8.9% as well as expectations. Though this would normally be viewed as bearish to US commodities the trade will likely note this could lead to easier monetary policy in the future.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

China News Shows Slowing Economy

Apr 13, 2012

Good Morning! Paul Georgy with early morning comments for April 13, 2012 at 5:10 am. Grain futures are mixed as talk of new purchases and Fed easing provide support to old crop corn and beans. China’s first quarter GDP grew at 8.1% which is the slowest in 3 years. This economic data is causing some profit taking in commodities this morning. Futures are still looking for some direction or reason to breakout of recent trading ranges. USDA gave us positive export numbers for old crop corn yesterday. The rumors have been circulating that China has bought additional old crop corn and soybeans. The USDA will release sales information this morning at 8:00 am. Pictures of crop damage due to frost have hit the internet. We do not believe there has been extensive damage. Rain is on its way to cover the Midwest with moisture over the next 5 days. Extended forecasts have warmed up the low temps for next week. Planting progress has been aggressive the last few days throughout the Corn Belt. Reports out of North Dakota where corn acres were going to increase indicate farmers have changed their minds. Due to the soil conditions, problems with getting certain varieties of seed corn, problems with fertilizer supplies and early planting possibilities, they are planting more spring wheat. Sunday night could be active as we will then know the rainfall coverage. Port conditions in Brazil still have logistics problems as the Port of Paranagua is reporting 25 day delay on loading. It is easy to see why world buyers would come to US for soybeans with that kind of delay. Cash cattle traded as high as 122 in the south this week. Packers continue to slow production as negative margins hit record highs. Futures have closed above downtrend and key moving averages which has provided a change in bias in the livestock complex. Boxed beef values decline again, Choice down .36 and select down .92. Pork cutout was down .71. The Allendale "Planting Special" 6 months for $99.00 will be available through April 20. Sign–up TODAY!
 
Markets as of 5:10 AM
May Corn    +1 3/4
May Beans   -2
May Wheat   -3/4
Apr Cattle -.15
Apr Hogs    -.475
Jun S&P     -6.50
Jun $ Ind   +.22
May Crude   -.53
June Gold   -7.60
 
Allendale Advanced Charts
Beans saw enough strength on Thursday that allowed a close near first resistance at 14.49. This is the highest close for the market since Sept. 9, 2011. For now the bulls remain in control but we still would not be surprised to see a significant correction.

 
Nelson Notes from the desk of Rich Nelson
Weekly exports for corn came in at 976 tmt. This was well above the trade estimates of 650-850 tmt. Given this number we are still running a little behind the USDA’s expected sales for the year.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Grain Futures Looking For Catalyst To Set Direction

Apr 12, 2012

Good Morning! Paul Georgy with early morning comments for April 12, 2012 at 5:10 am. Grain futures are slightly higher this morning. Temperatures again are below 30 degrees in parts of IL and IN at this hour but no wide spread damage is expected. Position traders are looking for a catalyst to push markets in one direction or the other and until that time, spreading will play a major role in price movement. The corn to soybean ratio has moved out to over 2.5 to 1 which is historically advantageous to beans when deciding what to plant. Significant rain should occur west of a line from Houston to Detroit this weekend. The rain would slow corn planting but we are hearing of some producers will be done with corn before rains get here. Producers in Indiana have been aggressively planting soybeans this week. Soybean futures have taken over the leadership role at the CME. Traders have been favoring the long side of soybeans especially with funds holding record long positions. We expect setbacks in the short-term to be well supported. However, we must be on the watch for an event that changes fund trader’s mindset. Stay in touch with your Allendale Representative. USDA Weekly export sales are expected to range from 700 tmt to 1.0 mmt for beans, 120 to 220 tmt for soymeal, and 2 to 10 tmt for soyoil. Weekly export sales for corn are expected to range from 650 to 950 tmt. Wheat estimate is 400 to 600 tmt. Cash cattle had a light volume trade in TX yesterday at 119 compared to last week at 121 to 122. Boxed beef was 1.02 lower for choice and .33 higher for select. Pork cutouts were up 1.64 to 79.53. Futures have been oversold and rallies are partially attributed to technical buying when downtrend line was taken out overnight. The Allendale "Planting Special" 6 months for $99.00 will be available through April 20. Sign–up TODAY!
 
Markets as of 5:10 AM
May Corn    +1 3/4
May Beans   +3 1/2
May Wheat   +2 1/4
Apr Cattle +1.62
Apr Hogs    +.525
Jun S&P     +3.75
Jun $ Ind   -.11
May Crude   +.34
June Gold   -3.40
 
Allendale Advanced Charts
Hogs have been trading on both sides of 20 day moving average. Look for support in June hogs at the March 23rd low of 91.52, which could set up an inverted Head and Shoulders bottom.

 
Nelson Notes from the desk of Rich Nelson
Temperatures last night were a little cooler than expected. Though it may not cause wheat production losses, it may set the crop back temporarily.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Markets Consolidate Overnight

Apr 11, 2012

Good Morning! Paul Georgy with early morning comments for April 11, 2012 at 5:00 am. Grain futures are mixed as markets consolidate after Tuesday’s volatile session. The USDA gave us something for the bears and bulls by cutting the production of soybeans in South American and reducing soy ending stocks in the US. The corn ending stocks of unchanged was a surprise as most were looking for at least an 80 million bushel reduction. The USDA’s reason was usage for the second half of year would be down and the early plantings would suggest an early harvest thus filling late year needs. Traders have turned their focus to the Eurozone again. Money traders are concerned about the recent rise in interest rates in Spain and Italy. Funds have built a record long position in beans and may want to take some profits. Weather is ideal for planting with some rain in the forecast for the weekend across the Corn Belt. Frost and cold temp are expected stay to the North over the next few nights. Weather will be watched closely for any changes in forecast and the "too" weather will stick its head up soon (too dry, too wet, too cold or too hot). Stay close to Allendale Research. Lower macro markets on Tuesday are weighing on livestock futures. Demand continues to be the major problem when trying to find a bottom in cattle prices. Boxed beef cutout values were weak with choice down .53 at 178.08, and select was .47 higher at 177.35. Pork carcass cutout value was down .52 at 77.89. Cash hogs were sharply lower in the country yesterday as pork is trying to compete with beef and chicken at the retail counter. Keep in touch with Allendale Research Center by subscribing today.
 
Markets as of 5:00 AM
May Corn    +4
May Beans   -1
May Wheat   +4
Apr Cattle -.35
Apr Hogs    -.60
Jun S&P     +11.75
Jun $ Ind   -.37
May Crude   +.69
June Gold   -1.50
 
Allendale Advanced Charts
June cattle took out its recent lows of 114.40 and have been in a sharp downtrend the past month and a half. We have support that comes in at 112.60.

 
Nelson Notes from the desk of Rich Nelson
Due to the smaller than expected March 30 quarterly Grain Stocks report, the grain trade expected USDA to lower ending stocks from 801 million bushels down to 721. They were looking for an increase in feed use. USDA chose to keep ending stocks unchanged.  
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Countdown to USDA Report

Apr 10, 2012

Good Morning! Paul Georgy with early morning comments for April 10, 2012 at 5:00 am. Grain futures are higher as traders make last minute position adjustments. In just a few hours the USDA will release their April Supply and Demand estimates. Trade estimates for ending stocks are: Corn 792 vs. USDA last month 801, Soybeans 246 vs. last month 275, wheat 792 vs. last month 825. Traders’ estimates are for lower Argentina production, corn 21.463 mmt vs. USDA March estimate of 22.00 mmt, soybean 45.19 vs. 46.50 mmt. Brazil’s trade estimate for corn is 61.71 mmt vs. 62.00 mmt in March, soybean 67.114 mmt vs. 68.50 mmt in March. Yesterday’s planting progress was in line with trade estimates at 7% of the nation’s corn planted. Illinois is way ahead of normal with 17% corn planted versus 1% average. Kentucky, Indiana and Missouri are also ahead of normal. Spring wheat plantings jumped from 8% last week to 21% this week verses 5% average. Funds were large sellers of corn about 10,000 contracts on Monday while selling 4,000 contracts of beans and buying 4,000 contracts of wheat. Check in with the "Morning Coffee" on YouTube at 8:00 and get the market reaction and details of the report or call your Allendale Representative. Wholesale boxed beef should some signs of life on Monday as choice was up 1.00 and select was up 1.58. Pork cutout values were down .13. It may take more than one day higher markets to suggest a bottom but certainly is encouraging. Keep in touch with Allendale Research Center by subscribing today.
 
Markets as of 5:00 AM
May Corn    +.04 1/4
May Beans   +.07 1/2
May Wheat   +.02
Apr Cattle +.225
Apr Hogs    -.325
Jun S&P     +4.25
Jun $ Ind   +.21
May Crude   -.55
June Gold   +1.00
 
Allendale Advanced Charts
Cattle closed weak Monday which does not provide a lot of confidence that the seasonal bottom is in. The recent rally maybe just a pit-stop before more liquidation.
Nelson Notes from the desk of Rich Nelson
Friday’s monthly assessment of the job market held disappointing results. Only 120,000 new jobs were added in the month of March. This was down from trade estimates of 200,000. It was also the lowest since month since October.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.
 

Spreading Ahead Of Supply Demand Report

Apr 09, 2012


Good Morning! Paul Georgy with early morning comments for April 9, 2012 at 5:00 am. Grain futures are mixed as spreading dominates trade. Starting off the week we have traders coming back from a long week with what they feel will be bullish news on Tuesday. The CFTC commitment of traders report showed funds adding to their record long position in beans by another 25,000 contracts. In corn funds reduced long positions by nearly 22,000. Traders will be watching the USDA Weekly progress report this afternoon as it is likely to show a sizeable increase in corn plantings. There should be a lot of corn planted this week as rain is spotty in the forecast now. Tomorrow morning the USDA will release the April Supply and Demand Report which traders are looking for sizeable reduction in old crop corn and bean ending stocks. This should keep the markets firm into that report. Managed money liquidated over 16,000 long positions in live cattle futures last week and 6,700 contracts in Lean Hog. Choice boxed beef was lower by .90 on Friday and select was down 1.36. Pork cutout was up .39. The weaker stock market indices this morning from poor unemployment news on Friday could cause livestock to open lower. Reminder: check the Allendale Research Center for 6 months for only $99.00.
 
Markets as of 5:00 AM
May Corn    +3/4
May Beans   -1 3/4
May Wheat   +0
Apr Cattle Stdy-lwr
Apr Hogs    Stdy-lwr
Jun S&P     -15.25
Jun $ Ind   +.07
May Crude   -1.58
June Gold   +10.50
 
Allendale Advanced Charts
For the third session in a row the corn market tested the downtrend and the 200 day moving average and failed. A close above the 6.66 level could trigger many buy stops.

 
Nelson Notes from the desk of Rich Nelson
Private analysts estimate the following changes for Tuesday’s monthly supply/demand report. Corn stocks may decline from 801 to 721 million bushels. Soybean stocks are seen declining from 275 to 246 million bushels. Wheat stocks are expected to decline from 825 to 792 million bushels. In that mix, Allendale’s estimates are 742, 240, and 825 million respectively.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Grain Traders Anticipate Market Moving Events

Apr 05, 2012

Good Morning! Paul Georgy with early morning comments for April 5, 2012 at 5:00 am. Grain futures are mixed with soybeans leading the charge higher. Today traders are faced with several events as it Thursday but the last trading day before a long weekend. We have the weekly export sales which will be released at 7:30. Friday morning the labor department will release the Unemployment data and Monday the USDA will gives us planting progress. Corn planting is underway but next week we should see the pace pickup. Then Tuesday the USDA will release the monthly Supply and Demand estimates. Soybean futures may consolidate tomorrow but buyers continue to build positions as open interest is growing daily. Trade estimates for the exports are: wheat 300 to 700 tmt, corn 400 to 800 tmt, soybeans 570 to 1,000 tmt, meal 50 to 165 tmt, and soyoil 5 to 30 tmt. Boxed beef values were sharply lower on Wednesday with choice down 2.45 and select down 2.54. Southern Plains cattle traded at 122 which were 3.00 lower than last week. Nebraska cattle traded as much as 4.00 to 5.00 lower. Pork cutout values were up .15. Choice wholesale beef started the year 18% over last year. Now, choice beef is 6% under last year. Like pork, a significant change in demand must be recognized. The hardest question to answer is, "When will this end?" stay in touch with Allendale Research Center by subscribing at the "Planting Special" for only $99.00.
 
Markets as of 5:00 AM
May Corn    -1 1/2
May Beans   +6 1/2
May Wheat   -1 1/4
Apr Cattle +.27
Apr Hogs    +.45
Jun S&P     -7.25
Jun $ Ind   +.28
May Crude   +.27
June Gold   +8.50
 
Allendale Advanced Charts
Crude oil saw plenty of pressure on Wednesday and broke the 62% retracement as well as the 100 day moving average. A close in this area could trigger further selling going into the weekend.

 
Nelson Notes from the desk of Rich Nelson
Retail sales for euro zone countries fell 2.1% compared with last year for February. That was below estimates for only a 0.9% decline.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Big Buying Of Spreads Push Old Crop Corn Higher

Apr 04, 2012

Good Morning! Paul Georgy with early morning comments for April 4, 2012 at 5:10 am. Grain futures are mixed as grain traders react to FOMC minutes. Fed decides on no QE3 at this time. Buying old crop corn and selling new crop had huge volume yesterday. Traders are convinced the USDA will subtract the 150 million bushel lost on the Quarterly Stocks right off the ending stocks of 2011/2012 corn. We think it is unlikely that will happen but do agree old crop supplies will remain very tight until new crop is harvested. New crop soybeans are gaining on old crop and on corn. Support in beans is coming from the expectation that next week’s supply and demand report will tighten stocks even further. Brazilian bean crop continues to get smaller on a daily basis. Celeres reduced their estimate of Brazilian bean production to 67.9 and Oil World dropped estimate to 65-66 mmt. Argentina’s bean production was lowered by the Rosario Exchange by 1.4 mmt to 43.1 mmt. Weather forecasts for next week seem to be pushing the cold temps further south with 32 degrees down as far as IA/MO border. We expect some profit taking ahead of the long weekend but markets should find support on any corrections as we approach the USDA Report next Tuesday at 7:30 and the uncertainty of weather over a long weekend. Cattle futures set new lows on Tuesday not seen since June of 2011. Fund and margin liquidation continue to pressure the livestock complex. Choice boxed beef was down 1.01 and select was down 1.44 on Tuesday. Beef battles for consumer’s spendable income with gas prices. The hopes of warm weekends will start the cookout season early this year. There has been a light test of cash sales at 3.00 lower than last week. Pork cutout values were down 1.53 yesterday afternoon. Allendale Research Center "Planting Special" is giving you the opportunity to subscribe for only $99.00.
 
Markets as of 5:10 AM
May Corn    +2 1/4
May Beans   -2 1/4
May Wheat   -6 3/4
Apr Cattle -.05
Apr Hogs    -.175
Jun S&P     -10.75
Jun $ Ind   +.10
May Crude   -.75
June Gold   -37.5
 
Allendale Advanced Charts
Soybeans took out yesterday’s high but couldn’t hold and settled near session lows. This is not surprising given the recent sharp rallies. A correction would be healthy for this uptrend.
 
 
Nelson Notes from the desk of Rich Nelson
USDA restarted the weekly Crop Progress reporting Monday. Corn planting was estimated at 3% as of Sunday night. That was above the 2% pace for last year and the 2% pace for the five year average. We expect planting to surge far above normal over the next two weeks.
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

Early Month Money Flow Drives Markets

Apr 03, 2012

 
Good Morning! Paul Georgy with early morning comments for April 3, 2012 at 5:10 am. Grain futures are mixed with corn higher and soybeans and wheat lower. The USDA gave us the first crop progress report of the season yesterday afternoon. Corn plantings were 3% complete compared to 2% last year and 2% average. The highlight was IL with 5% planted and IN with 1% compared to 0% last year. The excellent planting weather has producers planting corn. Price relationship between corn and beans has moved from 2.0:1 in January to 2.54:1 yesterday. Current spread value already has producers considering switching from corn to soybeans. In 2009, the price relationship was similar and from March to June reports, soybean acres increased by 1.5 million acres. The beginning of the quarter and month has money flow moving back into grains. Funds continue to extend their long positions by adding another 9,000 soybeans and 15,000 corn on Monday. Weather forecasts will have an impact on grain prices for next several weeks as frost is a concern until we get into May then too dry or too wet will be a factor. The macro markets will be watching China’s economic data and the EU dealing with financial problems. The cash cattle trade was at a standstill Monday but choice boxed beef was up .73 and select was down .05. Hog futures rallied after the Hogs and Pigs Report and now have potential for a seasonal bottoming action. Pork cutout values were down .02. Allendale Research Center "Planting Special" is giving you the opportunity to subscribe for only $99.00.
 
Markets as of 5:10 AM
May Corn    +2
May Beans   -4 3/4
May Wheat   -4 3/4
Apr Cattle +.20
Apr Hogs    -.15
Jun S&P     -2.75
Jun $ Ind   -.01
May Crude   -.80
June Gold   -2.30
 
Allendale Advanced Charts
The hog market broke above its short term downtrend line and closed above it today. If we can close above today’s highs we may be setting a bottom. Look for resistance at the 20 day MA which is 85.75.
 
 
Nelson Notes from the desk of Rich Nelson
Friday’s report indicated the mid-year count of corn stocks came in smaller than expected. The 6.009 billion bushels, counted as of March 1, may cause analysts to lower their view of end of year stock levels. Industry discussion is that USDA could eventually lower their current 801 million bushel estimate, for August 31, down to 600 – 700 million by summer.
 
 
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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.

USDA Provides Reason For Soybeans To Gain On Corn

Apr 02, 2012

Good Morning! Paul Georgy with early morning comments for April 2, 2012 at 5:10 am. Grain futures are mixed with corn and soybeans higher and wheat lower. The USDA gave us some friendly numbers on Friday morning reducing corn stocks by more than traders were expecting. They also put planting projections for soybeans below expectations which suggest an even tighter bean supply next year. The price relationship between corn and soybeans on March 1 when the data was taken was heavily weighted to planting corn. The prices are now trending toward an advantage to soybeans. We are getting calls from producers who are switching from corn to beans. We are hearing from seed salesmen who are getting corn seed returned and soybeans seed purchases. Other news overnight came from China where they put their PMI at 53.1 which improved to the highest number since April of 2011. However, HSBC released its estimate of China’s PMI at 48.3 which is the fifth consecutive month with lower manufacturing data. Weather forecast for this coming week is above normal but Euro and GFS models are giving conflicting ideas about frost for next Monday and Tuesday. We will be focused on this developing forecast as this week is a short week due to markets closed for Good Friday. Livestock markets will be trading the Hogs and Pigs report when they open this morning. Most numbers were slightly below trade estimates. Choice boxed beef was down .09 and select was down .72 on Friday. Pork cutout values were up .46 to end the week. Fund liquidation could be the feature as we start trading this week. Follow the Allendale Research Center and signup for special offer.

 
Markets as of 5:10 AM
May Corn    +7 3/4
May Beans   +12 1/2
May Wheat   -2 1/4
Apr Cattle stdy-lwr
Apr Hogs    stdy-hgr
Jun S&P     +1.25
Jun $ Ind   -.12
May Crude   -.41
June Gold   -3.50
 
Allendale Advanced Charts
Corn closed limit up on Friday in response to the bullish quarterly stocks number from USDA. This put a test to the 50 day moving average and 62% retracement. This market has established a trading range from 6.00 to 6.75.
 

Nelson Notes from the desk of Rich Nelson
USDA indicates that 95.864 million acres of corn will be planted, a significant increase from last year’s 91.921. They peg bean acres at 73.902 million acres, over 1 million less than last year. Wheat acres look for a slight increase to 55.908 million acres
Contact Allendale: 800-262-7538 research@allendale-inc.comwww.allendale-inc.com
 
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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