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March 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.
 

Corn Breaks Key Chart Support ahead of Major Report

Mar 30, 2012

 

Good Morning! Paul Georgy with early morning comments for March 30, 2012 at 5:10 am. Grain futures are slightly higher as macro markets provide support this morning. End of month money flow and fear dominated grain futures markets yesterday. May corn futures have dropped 53 cents from Monday’s high to Thursday’s close and 3 1/2 cents from the low made after the January Grain Stocks Report. In a few hours the hype will become reality; the USDA will release the long awaited Quarterly Stocks and Prospective Plantings Reports. Remember, the corn and soybean plantings estimated by the USDA are as of the beginning of March. Price relationships were much more in favor of planting corn versus beans than today. The Quarterly stocks average estimates for this morning’s report are: wheat 1.223, corn 6.150 and soybeans 1.387 compared to last year wheat 1.425, corn 6.523 and soybeans 1.249 million bushel. Prospective planting trade average estimates are corn 94.72 million acres and soybeans 75.393 million acres compared to last year 91.92 and 74.976 respectively. Cash cattle trade 125 in TX and KS which are 1.00 lower from last week. NE was 1.00 to 2.00 lower than last week. Boxed beef was lower with choice down .78 and select down 1.20. Pork cutout values were down .77. The USDA will be releasing Quarterly Hogs and Pigs Report this afternoon at 2:00 pm. Report estimates are All Hogs 101.7, Kept for Breeding 100.3, and Kept for Market 100.8. Get full pre-report and post-report comments in the Allendale Research Center. I will have a reaction to the Grain report on the Morning Coffee on YouTube by 8:00 am.
 
Markets as of 5:10 AM
May Corn    +2
May Beans   +5 ½
May Wheat   +2 3/4
Apr Cattle -.125
Apr Hogs    -.125
Jun S&P     +7.25
Jun $ Index -.38
May Crude   +.63
June Gold   +12.30
 
Allendale Advanced Charts
Beans pulled back to the 20 day moving average on Thursday as increased selling pressure continued throughout the session. The uptrend is still intact, as key support is 13.38 1/2. A break of this level could activate more selling.
 

Nelson Notes from the desk of Rich Nelson
Weekly unemployment claims fell by 5,000 to 359,000 in the week ended March 24. This is a new low. The insured unemployment rate, shown here, fell to a new low for the recovery to 2.6%. The US economy is slowly improving.
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.

 

Weekly Export Sales To Be Release This Morning

Mar 29, 2012

Good Morning! Paul Georgy with early morning comments for March 29, 2012 at 5:10 am. Grain markets are mixed this morning. Macro markets are providing a little tailwind for selling. Choppy action today is likely as traders adjust positions. In a little over 24 hours the USDA will release the long awaited Quarterly Stocks and Prospective Plantings Reports. Remember, the corn and soybean plantings estimated by the USDA are as of the beginning of March. Price relationships were much more in favor of planting corn versus beans than today. So the trade seems to be expecting a bearish corn number and bullish beans as corn is making new lows for its recent move and beans are near recent trend highs. Dow Jones newswire released trade estimates for this morning’s Weekly Export Sales: Wheat 450-750 tmt, Corn 600-900 tmt, Soybeans 450-750 tmt, Soymeal 50-165 tmt, Soyoil 5-25 tmt. The Quarterly stocks average estimates for Friday mornings report are: Wheat 1.223, Corn 6.150 and soybeans 1.387 compared to last year Wheat 1.425, Corn 6.523 and soybeans 1.249 million bushel. Prospective planting trade average estimates are corn 94.72 million acres and soybeans 75.393 million acres compared to last year 91.92 and 74.976 respectively. Outside markets or money flow will have to be watched closely as newswires were reporting China buying corn had no impact on slowing down the selling of futures yesterday. Cash cattle traded 2.00 lower in Southern Plains while boxed beef continues the slide. Choice was down 1.20 and select was down 1.06. Pork cutouts were down .12. The USDA will be releasing Quarterly Hogs and Pigs Report on Friday at 2:00. Get full pre-report and post-report comments in the Allendale Research Center. Listen to the Morning Coffee on YouTube Friday morning to get details of the report.
 
Markets as of 5:10 AM
May Corn    -2               May Beans   +1 1/2            May Wheat   + 3/4
Apr Cattle -.20              Apr Hogs    -.375             May Crude   -.46
Jun $ Index +.08              Jun S&P     -4.75             June Gold   -3.90
 
Allendale Advanced Charts
Corn was unable to hold above the 50% retracement today as it continued the recent weakness and finished near the 62% retracement on Wednesday. A close below this level would open the door for a retest of January lows of 5.99. We have seen a slide of 36 cents from Monday’s high.


Nelson Notes from the desk of Rich Nelson
EU analysis firm, Oil World, made an interesting claim Tuesday. The group suggests China will need to buy US old crop soybeans to fill April – July imports. Up until now the general trade’s expectation for South American problems was that it would mostly be a US new crop issue. If China purchases do swing to US old crop, in a big way, it could justify the current prices for old crop US futures.
 
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.

Funds Hold Record Long Soybean Contracts

Mar 28, 2012

Good Morning! Paul Georgy with early morning comments for March 28, 2012 at 5:00 am. Grain futures are higher this morning. Traders are adjusting positions ahead of Friday’s USDA report. This report has significant moves after the data release; Bloomberg News released a study suggesting corn had limit moves after the report 6 out of the last 7 times. Funds have record long positions in soybeans and seem to have a "bullet proof" mentality about being long. Brazil crop watchers continue to downgrade the soybean production for that region. Wheat is beginning to come out of dormancy in Spain and France where moisture is short and the forecast for rain is limited. Although we must remember according to the latest USDA report there are record world wheat stocks. The next two sessions will be impacted by money flow. Funds were estimated to have sold 9000 corn contracts, 6,000 soybeans and 4,000 wheat on Tuesday. Markets will move with their bias until Friday morning. More discussion can be found in the Allendale Research Center. Livestock futures gave us a bounce on Tuesday but there was no help when the beef values were reporedt. Choice was down 1.31 and select was down 1.18. Technically the rally on Tuesday could have been short covering due to oversold markets. Pork cutout values were up .58. Allendale has a special pricing for the Allendale Research center go to www.allendale-inc.com for more details. There are only a few days to take advantage of the Planter’s Special for $99.00. Listen to the Morning Coffee on Friday Morning to get the update on the report.
 
Markets as of 5:00 AM
May Corn    +1 1/4            May Beans   +7 3/4            May Wheat   +3 3/4
Apr Cattle -.15              Apr Hogs    -.05              May Crude   -1.02
Jun $ Index -.01              Jun S&P     +1.00             June Gold   -10.60
 
Allendale Advanced Charts
June cattle futures rallied on Tuesday and now appear to have momentum to test the 20 day moving average and the downtrend resistance line at 123.75. Key support cross at Friday’s low of 120.17.
 

Nelson Notes from the desk of Rich Nelson
The trade is now discussing whether current high soybean prices will take acreage away from corn. Revenue comparison is a more accurate measurement than the well-known soybean/corn ratio. Since the first of the year, corn’s premium over soybeans has declined by $106 per acre. 
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.

Volatile Markets Expected Into Friday’s Report

Mar 27, 2012

Good Morning! Paul Georgy with early morning comments for March 27, 2012 at 5:10 am. Grain futures are firmer as markets set the stage for the USDA report on Friday morning. Pre-release trade estimates are suggesting lower quarterly stocks and more planted acres for both corn and soybeans. Rich Nelson released to our subscribers’ yesterday afternoon a chart showing the reaction to quarterly stock data for corn in the last 3 reports. The average price decline for corn was nearly 37 cents after the data was released. The spread relationship between December Corn and November Soybeans closed at a new high 2.40/1. Dryness issues in the EU have traders concerned about wheat getting started there while rain is limited in the forecast for the next 10 days. Although traders will be focused on the USDA Report as we get closer to Friday, the macro markets will have its influences. Traders are talking about a possible QE3 after Fed Chairman’s speech yesterday. This type of chatter is fueling inflation buying interest in the grains. The Eurozone has been quiet after the ECB dumped money into the system, however the story is not over. On the livestock side, product continued on the streak of lower values. Choice was down .66 and select was down .01. The Lean Finely Textured Beef story has caused the closing of several plants and 650 jobs. This needs to be put behind us in order to rebound beef prices. Pork cutout values were .15 higher on Monday while futures indicators are registering oversold. Allendale has a special pricing for the Allendale Research center go to www.allendale-inc.com for more details.
 
Markets as of 5:10 AM
May Corn    +5          May Beans   +7          May Wheat   +2
Apr Cattle -.12        Apr Hogs    -.22        May Crude   +.25
Jun $ Index -.11        Jun S&P     +1.00       June Gold   +7.60
 
Allendale Advanced Charts
Corn was unable to hold onto early gains yesterday and settled near session lows. The late session selloff pushed prices below the uptrend line. It is important to close higher today in order to maintain a positive picture.

 
Nelson Notes from the desk of Rich Nelson
The Reuters newswire poll of 25 analysts found the average trade guess for corn acres at 94.720 million. That is above the group’s February poll of 94.2 million. It represents a 2.799 million acre increase over last 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.

Markets Look Ahead to Friday’s Report

Mar 26, 2012

 

Good Morning! Paul Georgy with early morning comments for March 26, 2012 at 5:10 am. Grain futures are mixed this morning. Soybeans are leading the grain markets higher as the abnormal, warm temps allow for early season fieldwork and potential planting of corn. The forecast for a smaller Brazilian bean crop, almost on a daily basis, is providing buyers with reasons to hold long positions going into the USDA report on Friday. Spreading will be a major influence on price movement this week as trader’s position for the USDA Prospective Planting and Quarterly Stock report on Friday morning. Trade estimates can be found in the Grain Section of the Allendale Research Center. Corn and wheat futures are sitting on technical support levels. Further selling could trigger more sell stop activation if these areas are broken. Look for some very choppy markets this week. Cattle on feed report showed we have more cattle on feed than a year ago and fewer cattle were marketed during February than the trade was expecting. This report is considered slightly bearish but with the sharp price decline in recent days may not have much impact on price. Product demand is the real problem for beef cutout values were lower again on Friday. Choice was down 1.51 and select was down 1.10. Pork cutout values were down .15 on Friday. Livestock futures are indicating a much oversold condition. Allendale has a special pricing for the Allendale Research center go to www.allendale-inc.com for more details.
 
Markets as of 5:10 AM
May Corn    +1         Apr Cattle stdy-lwr          Jun $ Index       +.21
May Beans   +11        Apr Hogs    stdy-lwr          May Crude         -.38
May Wheat   +0         Jun S&P     +2.25            June Gold         -2.90
 
Allendale Advanced Charts
Cattle fell through support on Friday testing major support level at 120.00. This contract is oversold however resistance crosses at 121.27 which was Wednesday’s low.
 
Nelson Notes from the desk of Rich Nelson
US grain traders suggest China may have bought at least two cargoes of Argentine soybeans yesterday. Based on yesterday’s weekly export sales, covering sales from March 9 – 15, it appeared China was backing away from US product. Based on industry talk of China’s action this week, it appears this may be the start of a new trend.
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.

 

Chinese Officials Comments Re-ignite Supply Fears

Mar 23, 2012

Good Morning! Paul Georgy with early morning comments for March 23, 2012 at 5:20 am. Grain futures are higher due to comments made by a Chinese think tank on future corn usage. Spreading will continue to impact grain prices as we close out this week. Inter-commodity spreading between corn/beans and corn/wheat has traders trying to guess the report next Friday. The volatility in these spreads doesn’t have fundamental justification on a daily basis. However the Sept corn versus Dec corn has narrowed nearly 10 cents this week. The early planting of corn certainly suggests the current 27 cent premium of Sept over Dec is too much. We are hearing reports of corn out of the ground already after being planted for only 5 days. After the current weather system moves through the Midwest, there will be many more planters running next week. Many producers want to hold off until the April 6 crop insurance date but this weather is just too hard to pass up. Rich Nelson did a study yesterday using normal maturation, this early planted corn could be pollinating in mid-June. The slowdown of the Chinese economy has funds moving money to the commodity they think provides the most opportunity. On Thursday it was let’s sell gold and buy corn. Expect more choppy action as we approach March 30th. The reduced packer production has not been the answer for improving cutout values and ultimately better margins. Packers paid steady to 1.00 higher this week for live cattle but choice beef was down .05 and select was down .65 yesterday. Pork cutouts were down .17 on Thursday. Higher gasoline prices have to be the major reason for sluggish beef demand as weather should provide a chance to do some early barbequing. The rally on Thursday in livestock futures helped move away from key support but a weak close today could trigger more selling pressure. We are running a Spring Planting Special for the Allendale Research Center; 6 months for only $99.00 click here to sign up.
 
Markets as of 5:20 AM
May Corn    +6         Apr Cattle -.20        Jun $ Index       -32
May Beans   +16        Apr Hogs    -.35       April Crude       +.48
May Wheat   +4         Jun S&P     +.25        June Gold         +8.20
 
Allendale Advanced Charts
Feeders bounced off the 50% retracement level on Thursday, which is also above the 100 day moving average. This was the second day in a row the market has held above Tuesday’s low at 151.85.

 
Nelson Notes from the desk of Rich Nelson
Wednesday morning, the EIA indicated ethanol production in the previous week was 893,000 barrels per day. That was 2% below last year in the same week. It is the second week in a row of lower than last year numbers. We should expect production to run week for several weeks now. We are not concerned about meeting USDA’s ethanol pace though as the first six months of the marketing year were made with a 3% higher than last year pace.
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 Becomes Major Feature As USDA Report Nears

Mar 22, 2012

Good Morning! Paul Georgy with early morning comments for March 22, 2012 at 5:10 am. Grain futures reverse early session gains as China releases manufacturing data. Signs of China’s economy slowing down continue to weigh on grain markets with corn getting the brunt of it. Reports of China buying feed wheat from Australia instead of US corn have those who ran the market up last week covering some of their positions. Corn also is getting pressure from the warm weather and forecast for some rain late this week for Midwest. Many producers are planting in the southern part of corn growing areas and many are telling us they will be planting next week. The early planting of corn has traders finally believing there could be more acres of corn planted and less beans. Current price relationships still favor corn. EU financial woes have been quiet this week although there is rumbling of potential problems in Portugal and concern Greece will not be able meet their economic goals. Spreaders have been the market movers in grains after the initial reaction from overnight news. Expect more of the same as we approach the March 30 USDA Report. Cash cattle traded at $127 today in the Central and Southern Plains. Nebraska sold a few cattle at $128. This $127 action was $1 higher than last week and a dramatic turnaround from early-week bearish expectations. The stronger than expected cash trade did not provide a lot of support to April futures. The product market is not providing much encouragement for futures traders as packer production slows down. Choice was down 2.12 and select down .66 on Wednesday. Pork cutout value was down .72. The high gas prices are believed to be affecting consumer demand. We are running a Spring Planting Special for the Allendale Research Center; 6 months for only $99.00 click here to sign up.
 
Markets as of 5:10 AM
May Corn    -3 1/2            Apr Cattle +.02        Jun $ Index       +.16
May Beans   -8 1/2            Apr Hogs    +.10       April Crude       -1.27
May Wheat   -3 3/4           Jun S&P     -8.25      June Gold         -13.10
 
Allendale Advanced Charts
The corn market backed off a bit further on Wednesday, but still remains above the current uptrend and key support area near 6.40.

 
Nelson Notes from the desk of Rich Nelson
Ethanol producers in the past year have started focusing on separating out corn oil from the corn by-product of ethanol production. While this separate activity gives them a separate revenue stream it has also lowered the amount of fat and energy in their DDG content. Some livestock producers suggest this may make them less satisfied with the product and they may switch back to soymeal and corn.
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 Raises Gasoline Prices

Mar 21, 2012

Good Morning! Paul Georgy with early morning comments for March 21, 2012 at 5:10 am. Grain futures are mixed this morning. The Chinese economic news adds concern to the commodity markets. China announced yesterday they were going to raise gasoline prices by 6 to 7% which is the largest such increase in over 3 years. This news has traders around the world expecting a larger slowdown of their economy which in turn means less demand for commodities. Funds have become sellers this week as many traders are getting positioned for one of the biggest USDA reports of the year, the March 30th Quarterly Stocks and Prospective Plantings. You may want to look at your own marketing plan and decide if you should protect the price on more bushels? There are many ways to use options in your strategy to protect the downside and leave the opportunity for higher returns. Call your Allendale representative today. Live cattle and hog futures closed below recent support on Tuesday. Watch for support in April cattle at 124.15 and support in April lean hogs now crosses at the May 2011 low of 83.27. Cash market interest is very limited. Product gave back some of Monday’s gains. However, the reduced packer production should support beef prices later this week. Choice was down .65 and select down .04. Pork cutout values were down 1.58. We are running a Spring Planting Special for the Allendale Research Center; 6 months for only $99.00 click here to sign up.
 
Markets as of 5:10 AM
May Corn    -2               Apr Cattle +.07        Jun $ Index       -.12
May Beans   +1 3/4            Apr Hogs    -.30       April Crude       +.52
May Wheat   - 3/4             Jun S&P     +3.50      June Gold         +7.40
 
Allendale Advanced Charts
April cattle closed below last week’s low after taking out the 62% retracement level. The next major support crosses at 124.15 which is near the January low. This market is very oversold but dominated by fund selling.

 
Nelson Notes from the desk of Rich Nelson
University of Illinois agronomist, Emerson Nafziger, notes "Planting in late March or early April has almost never produced higher yields than planting in late April". Though we have not had a nationwide 50% complete number before April 25, Allendale would suspect that feat would imply better than 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.

Mild Winter Increases Field Maintenance

Mar 20, 2012

Good Morning! Paul Georgy with early morning comments for March 20, 2012 at 5:10 am. Grain prices are lower this morning. Money flow out of agricultural commodities started on Monday as the major force behind this selloff. Although traders are in a tug-o-war as they determine the value of old crop corn versus new crop in both corn and beans as we approach the USDA Report. Allendale research has looked at the effect of 95.0 million acres of corn and 74.5 million acres of beans on ending stocks. Corn stocks would grow to near 1.5 billion in 2012-2013 marketing year. Soybeans have to be adjusted for the unexpected demand which we have received this year due to South American troubles. The potential for lower supplies due to fewer acres than 2012 could create even tighter ending stock for soybeans. An observation from my travels to ND, IA and Southern IL in recent weeks is that farmers have been very busy cleaning up old fence rows and tree lines. How many more acres will that add? Or should we ask how many more bushels will be produced from the same fields?  New trouble for Argentina grain logistics comes from the largest truckers union who called a strike yesterday. This is a normal yearly process to keep revenue in line with cost of inflation. On the livestock side, has cash cattle topped for the season? Historically, the price decline from spring highs to summer lows is between 8 to 19%. This would suggest an average decline could take prices to 114 for cash cattle by summer lows. Product values finally showed some improvement today with choice up 1.83 and select up .85. Pork cutout values were down .41 on Monday. Would you like a daily text update on your cell phone during the trading session? Please let us know your thoughts by sending an email to research@allendale-inc.com.
 
Markets as of 5:10 AM
May Corn    -8 3/4            Apr Cattle -.40        Jun $ Index       +.24
May Beans   -14               Apr Hogs    -.50       April Crude       -.86
May Wheat   -9 1/4            Jun S&P     -7.50      June Gold         -18.20
 
Allendale Advanced Charts
Corn posted an outside bar on the charts on Monday with a bearish close. The markets slipped below the 200 day moving average and the 38% retracement. A lower close on Tuesday could trigger ideas the near-term top is in.

 
Nelson Notes from the desk of Rich Nelson
Friday’s Commitment of Traders release indicated the following changes for Managed Money between March 7 and March 13. Corn -810, soybeans +19,725, Chicago wheat -13,710, live cattle -5, 023, lean hogs -215. Traders may be surprised to see the funds were doing light sales through last Tuesday in corn.
 
 
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.

Traders Look Ahead To Month End Report

Mar 19, 2012

Good Morning! Paul Georgy with early morning comments for March 19, 2012 at 5:10 am. Grains are lower as traders take profits. The fundamental issues traders will be watching this week are weather conditions in South America and rainfall through the Midwest in the US. Corn planting is getting underway in the southern half of the cornbelt. Exports will be watched very closely this week for confirmation that China has bought corn or soybeans. Allendale’s 95.012 estimates for planted acreage of corn will make it much easier to achieve a 14 billion bushel corn crop in 2012. Thanks to all who participated in this year’s survey. The port situation in Brazil and Argentina will remain a problem for meeting their shipment. However the port worker strike has ended and things are expected to get back to normal by early April. Money flow is still going to be the biggest market mover. Watch headlines and technical chart points for direction. Beef prices close out the week with choice down another .29 and select down .41 on Friday. Pork cutout values were down .03. We would expect a steady-higher call for the opening today, after the sharp selloff on Friday in the livestock futures.
 
Markets as of 5:10 AM
May Corn    -8          Apr Cattle stdy        Jun $ Index       +.02
May Beans   -9          Apr Hogs    stdy       April Crude       -.29
May Wheat   -7          Jun S&P     -2.75      June Gold         +1.30
 
Allendale Advanced Charts
The soybean market has been in a steady uptrend for the past 3 months. Support should be found at 13.50 where uptrend support line crosses.

 
Nelson Notes from the desk of Rich Nelson
Allendale’s 23rd annual acreage survey found a large net increase in the nation’s top three crops. Producers told us there would be more corn planted than USDA estimated at the AgForum conference. Soybean and wheat plantings would be smaller than USDA previously estimated.
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.

Allendale Releases Planting Survey Results

Mar 16, 2012

Good Morning! Paul Georgy with early morning comments for March 16, 2012 at 4:45 am. Rich Nelson will release the results of Allendale’s 23rd Annual Planted Acreage Survey this morning at 7:30. The results will be emailed and the "Morning Coffee" on YouTube will have a breakdown of the results. If there are any questions please call Allendale at 800-262-7538. Grain markets are lower on profit taking this morning. The strength in soybeans in recent sessions has been the leader for the grain complex. The shipping problem in Brazil’s major port has a 20 day delay. Reports from contacts in Brazil are that it is expected these problems will be resolved within a few weeks. Argentina’s Rosario port has much bigger delays. The daily downgrade of the Brazilian bean crop also supplies bullish excitement. Money flow has dominated the grain trade. On Thursday Reuters reported funds bought 11,000 corn, 5,000 wheat and 7,000 soybeans. The macro market influences on grains has been minimal this week. The Greece situation has cooled off for a while as Portugal will likely be the next hot spot. USDA Quarterly stocks report will be released on March 30 which is anticipated to be friendly by many analysts. Cash cattle traded late yesterday at 126 which is steady with last week. Product continues to slide this week. Choice was down .67 and select was down .57. Pork cutouts were down 1.03 on Thursday. Cattle futures rallied after cash sales were announced. Visit www.allendale-inc.com for more information.
 
Markets as of 4:45 AM
May Corn    -1/2              Apr Cattle +.57        Jun $ Index       +.18
May Beans   -3 1/2            Apr Hogs    -.27       April Crude       +.40
May Wheat   -1 1/4            Jun S&P     +.25        June Gold         -7.20
 
Allendale Advanced Charts
Corn has finally closed above first resistance on Thursday. In addition, the settlement was above the key 200 day moving average. There are still two more levels of resistance before we have a bullish breakout.

 
Nelson Notes from the desk of Rich Nelson
Last week’s old crop soybean export sales, reported this morning, totaled 609,700 tonnes (22 million bushels). This was the largest sale for this week in seven years. New crop sales, at 784,000 tonnes were better than any previous years in that week.
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.

Strong Performance by Grains Overnight

Mar 15, 2012

 

Good Morning! Paul Georgy with early morning comments for March 15, 2012 at 5:20 am. Grain futures are higher this morning ahead of the weekly USDA sales figures. Spreaders are buying beans as they focus on China shopping for soybeans from US because of short crops in Brazil and Argentina. NOPA crush data was supportive as the soybean crush was larger than expected. Soyoil stocks were a surprise as they were 120 mil lbs. above estimates. Another private analyst lowered the Brazilian soy crop to near 67 mmt. Weekly export sales will be released this morning at 7:30. Trade estimates are: corn 500 to 900 tmt, soybeans 700 to 1,200 tmt, meal 75 to 145 tmt, soyoil 5 to 25 tmt and wheat 400 to 800 tmt. Traders will have a watchful eye on the newswire at 8:00 am for any new sales of corn or beans to China. Allendale will release the results of the 23rd Annual Planting Survey tomorrow morning at 7:30. Cash cattle sales were at a standoff yesterday while beef product was sharply lower again. Choice was down 1.26 and select was down 1.75 which will add to the negative packer margins. Futures are hoping for a steady cash trade this week. Pork cutout values down .60 are being pressured by too much competitive meat available to the marketplace. Futures have been finding support early in session and selling off late. We will have to watch for cash sales to give us direction. Check with Allendale Research Center for more details on the markets www.allendale-inc.com.  
 
Markets as of 5:20 AM
May Corn    +5          Apr Cattle +.45        Jun $ Index       -.09
May Beans   +11         Apr Hogs    +.40       April Crude       -.04
May Wheat   +2          Jun S&P     +1.25       June Gold         +1.40
 
Allendale Advanced Charts
The dollar index continues to find strength and penetrated the 62% retracement level on Wednesday. A close above 80.55 is needed to signal a potential move to January highs.

 
Nelson Notes from the desk of Rich Nelson
As of Tuesday afternoon, the labor strike at Argentina’s Rosario port has idled 85 cargo ships. Workers are demanding an eight hour workday and for a fourth crew member to be assigned to each team in charge of mooring vessels. Currently workers work a 12 hour day in three man teams. Argentina is the world’s #2 exporter of corn and #1 exporter of both soymeal and soyoil.
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 Traders Wait for More Sales Data

Mar 14, 2012

 

Good Morning! Paul Georgy with early morning comments for March 14, 2012 at 5:10 am. Grain futures are mixed this morning as soybeans continue to show strength. Money flow continues to impact commodity prices. Grain futures have been taking turns on leadership. Soybeans continue their trek higher on South American production estimates and port problems in Argentina. It will be some time before we get the final harvest numbers. Reuter’s news wire was reporting 85 ships waiting to be loaded in the main Argentina port of Rosario. This delay is caused by a port workers strike which talks have broken off and next meeting scheduled for March 26. Traders will be watching for any more sales announcements by USDA at 8:00 am. The Quarterly stock report on March 30 is providing buying enthusiasm as many are expecting a large reduction in corn stocks. Allendale will release our planting survey results on Friday morning at 7:30 am. Today is last trading day for March grain futures contracts. Cattle futures rebound on positive economic news. Cash markets are at a standstill early this week but product continues to slide. Choice beef was down .98 and select was down 1.35 on Tuesday. Packers will likely hold out until late in the week to buy their needs. Steer and heifer weights are running well above normal as we are seeing the effect of a mild winter. Pork cutout values are slightly higher as exports continue to support prices. Sign up for Allendale Research Center today!
 
Markets as of 5:10 AM
May Corn    -4          Apr Cattle +.00        Jun $ Index       +.09
May Beans   +2          Apr Hogs    -.07       April Crude       -.34
May Wheat   -5          Jun S&P     +.75        June Gold         -33.10
 
Allendale Advanced Charts
April feeder cattle have held the uptrend line. Resistance is just overhead at 158.45, but must clear the 40 day moving average first. Contract highs of 162.05 should be retested if we break through first level of resistance.
 
Nelson Notes from the desk of Rich Nelson
The US grain trade expects Tuesday morning’s sale of 240,000 tonnes of corn to "unknown" to be the Chinese purchases that have been discussed. This was a little better than the two to three cargoes the trade has been expecting (120,000-180,000).
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.

 

Rumors Rule Markets

Mar 13, 2012

Good Morning! Paul Georgy with early morning comments for March 13, 2012 at 5:20 am. Grain futures are higher this morning. Rumor of China buying old crop corn was the catalyst which turned prices higher on Monday. We are all waiting for 8:00 am when the USDA releases any sales of 100,000 tonnes or more. Will it be China, or South Korea and Mexico who are looking to buy corn? Current tight stocks of US corn will continue to provide extreme sensitivity to rumors and weather until we are sure the 2012 corn crop is made. Traders are already focusing on the March 30 stocks report which should help provide a clearer explanation of the USDA’s balance sheet for corn. March 30 Prospective Plantings numbers will be key for price direction of new crop corn and soybeans. Allendale will be releasing the results of our 23rd Annual Planting survey on Friday morning at 7:30. The Greek Credit Default Swap issue has cooled off until next Monday when the pricing will be settled by auction, but don’t expect the EU to stay out of the spotlight for long. Portugal seems to be the next country to have financial issues. Weather in South America is not a factor right now but focus is switching to the US Midwest. Corn planting will be getting underway this week in Southern Illinois and Indiana. Cattle futures on Monday had a large price swing late in the session prompted by short covering in an oversold market. Product values were under pressure again. Choice was down .73 and select down 1.11. Hog futures did not show strength on the close as pork cutout values ended the day up .58. Full details can be found in the Allendale Research Center, Subscribe TODAY!
 
Markets as of 5:20 AM
May Corn    +3          Apr Cattle -.02        Jun $ Index       +.11
May Beans   +12         Apr Hogs    +.05       April Crude       +.45
May Wheat   +4          Jun S&P     +7.75       June Gold         -3.50
 
Allendale Advanced Charts
Corn futures have rallied nearly 30 cents in 2 sessions and are still in a trading range. Resistance crosses at 665 and then at the January highs of 6.72 ½. Support remains at last week’s lows.

 
Nelson Notes from the desk of Rich Nelson
In recent weeks there has been disagreement over the size of China’s fall corn harvest. The official government estimate is 191.75 million tonnes (Ministry of Agriculture). The think-tank, China National Grains and Oils Information Centre, sees it at 185 mt. Private Chinese brokerage firm, JC Intelligence, sees it at 168 mt.

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.

Commodity Markets Are Quiet Overnight

Mar 12, 2012

Good Morning! Paul Georgy with early morning comments for March 12, 2012 at 5:10 am. Grain futures are slightly higher this morning. Now that the neutral USDA supply and demand report is out of the way, trade will be focusing on the rumor circulating Friday that China was buying US old crop corn. We will be waiting for any confirmation of a sale this week. It seems unlikely that China would be buying old crop but we will have to wait and see. In a few weeks the USDA will provide us with Prospective Plantings which promises to be a market mover. Allendale just completed the 23rd Annual Planting Intention Survey of our clients and listeners. We will release our findings this Friday March 16, 2012. Big thanks to all of you who helped us with the survey. Weather will be monitored closely as this growing season will be very important due to current tight ending stocks. In my travels this past weekend I saw a few farmers doing fieldwork and a fertilizer plant open on Sunday. The warm weather is getting this planting season started even if it is only March 11. Cattle futures closed weak on Friday and would expect more pressure this morning if outside markets are under pressure at 9:05. Beef was lower on Friday, choice was down 1.96 and select was down .59. Pork cutout values were down .46. These lower product values are suggesting there still is a problem moving meat at the retail counter. Follow Allendale on YouTube and Twitter or subscribe online and receive Allendale on your mobile phone.
 
Markets as of 5:10 AM
May Corn    +2          Apr Cattle stdy        Jun $ Index       -.11
May Beans   + 1/2       Apr Hogs    stdy       April Crude       -.79
May Wheat   +1/4       Jun S&P     -.75        June Gold         -4.70
 
Allendale Advanced Charts
May beans came within pennies of reaching objective from a Head and Shoulders bottom and closing out the session in a Doji day (where open and close is at the same price). Signals suggest a possible correction in the making.

 
Nelson Notes from the desk of Rich Nelson
No changes at all were made to US soybean exports or crush. Considering the changes to South American production, USDA should have given US old crop exports a little boost. Though most of the SA production drop will benefit new crop US exports, at least a small amount should have been added to the old crop US. Ending stocks left unchanged at a large 275 million bushels. Traders will be disappointed in this report (bearish) but likely will not completely believe it.

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.

Traders Wait for USDA Report

Mar 09, 2012

Good Morning! Paul Georgy with early morning comments for March 9, 2012 at 5:15 am. Grain futures are higher ahead of this morning’s USDA report due at 7:30. The Dollar is higher as Greece uses collective action clauses to complete the debt swap deal. Unemployment numbers out at 7:30 could also have an impact on commodity prices this morning. The export sales data released on Thursday morning surprised bean traders with over 1.600 mmt sold. Trade was expecting 500 to 700 tmt. Funds have been buying beans and selling corn in a big way going into today’s report. The trade seems to be expecting a large reduction in South American soybean and corn production. IBGE, Brazil’s stats agency dropped production to 67.52 mmt which was below the CONAB estimate. The numbers to watch when the report is released this morning are the US corn and soybean ending stocks and the Brazilian and Argentine corn and soybean production. We will provide a complete update on the "Morning Coffee" segment on YouTube by 8:00 am. The pork industry will be getting more timely information when (FAS) begins releasing weekly pork exports which should be coming soon. Cash cattle traded at 126 to 127 on a decent volume this week. Beef was dropped sharply on Thursday as choice was down 1.73 and select was down 1.13. Pork cutout values were lower by 1.43. Check out the Allendale Research Center and stay up to date with market moving information.
 
Markets as of 5:15 AM
May Corn    +3 ¼        Apr Cattle -.27        Jun $ Index       +.27
May Beans   +14 ¼       Apr Hogs    +.47       April Crude       +.20
May Wheat   +4          Jun S&P     -2.00       June Gold         +1.30
 
Allendale Advanced Charts
Corn was forced lower by fund selling on Thursday, settling below the key moving averages for the second day. The door is now open for a move to the 6.26 area.

 
Nelson Notes from the desk of Rich Nelson
Reuter’s newswire, in a private investigation with Beijing brokerage firm JC Intelligence, estimates the Chinese government overstated last year’s corn crop from 6.8 to 24.0 million tonnes. Last year’s corn crop was announced to be a record 191.75 million tonnes. If true, this would imply China may be a more aggressive buyer than many expect this 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.

Traders Find Optimism in Overnight Session

Mar 08, 2012

 

Good Morning! Paul Georgy with early morning comments for March 8, 2012 at 5:20 am. Grain futures are higher as traders now believe Greece will not default by Friday. The USDA will give us their weekly export data this morning at 7:30. Corn sales for last week are expected to be 500 to 750 tmt. The soybean estimate is 600 to 900 tmt and the wheat estimate is 300 to 600 tmt. The trade is expecting lower ending stocks for corn and soybeans and lower production out of Argentina and Brazil on the Supply and Demand Report. The Macro market traders are worried about the unemployment data being released at 7:30 on Friday but now feel Greece will get acceptance of the swap deal and avert a default. These uncertainties will likely keep markets volatile for the rest of the week. The livestock futures collapse on Tuesday caused some movement of fed cattle at 3 to 4 dollars lower than last week. Most cattle in the south were traded at 126 to 127 compared to last week at 130. Choice beef values were .58 lower and select was up .33 on Wednesday. Pork values were up .57. There are only a few days to help us with our 23 annual planted acreage survey. Go to www.allendale-inc.com and follow the directions.
 
Markets as of 5:20 AM
May Corn    +4 ¼              Apr Cattle -.15              Jun $ Index       -.34
May Beans   +5 ¾              Apr Hogs    +.05             April Crude       +.95
May Wheat   +6 ¾             Jun S&P     +12.50            June Gold         +18.10
 
Allendale Advanced Charts
KC wheat dropped toward the 4 month uptrend line on Wednesday after breaking the 50 and 100 day moving averages near 7.00. As we have seen in other commodities this week if the uptrend line is broken we could see further selling.

 
Nelson Notes from the desk of Rich Nelson
In its weekly SpendingPulse report MasterCard estimates gasoline demand was 6.5% smaller than the same week last year. This comes as retail gas prices, at $3.75 across the nation, were 9.3% higher than a year ago. High gas prices are supporting ethanol prices. However, ethanol demand is being limited by the lower quantity desired.

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 Recover Slightly Overnight

Mar 07, 2012

Good Morning! Paul Georgy with early morning comments for March 7, 2012 at 5:10 am. Grain markets are mostly higher this morning. Spreading has been a key market mover recently as traders get positioned for Friday’s USDA Report. There is talk that soybeans are getting strength from Chinese buying as South American deals with port delays. Another twist is the reduced supply of DDGs is creating more demand for soybean meal, ultimately supporting nearby beans. News wires are reporting trade guesses for the Argentine bean crop is 46.8 and for Brazil it is 69.3. Traders are expecting lower ending stocks for both old crop corn and old crop beans. Friday morning could create some fireworks as the US employment and USDA Supply and Demand report will be released at 7:30 CST. The risk-off attitude by traders is surrounding the chance that Greece defaults by early Friday. Weather in South America should not have much of an impact in the near-term. Allendale is in the final days of gathering data for the 23rd Annual Planted Acreage survey. If you haven’t gone to www.allendale-inc.com and filled out a survey we would appreciate you doing it now. The more accurate data, the better the results. Livestock futures are trying to rebound from yesterday’s selling attack which stemmed from fund profit taking. Cash cattle sales are likely to wait until late week. Choice beef was up .12 and select was up.56. Pork cutout values were slightly lower. Thank you to AgriGold for hosting the meeting in Riverside IA yesterday. Thanks to a great group of interested producers with many questions.
 
Markets as of 5:10 AM
Corn    +1 to +2                      Live Cattle     -10 to +20                   US Dollar Index         -.14
Beans +2 to +3                      Lean Hogs      -15 to -25                    Crude Oil                    +.585
Wheat +0 to +3                     S&P Index      +5.50                           Gold                            +8.50
 
Allendale Advanced Charts
Crude Oil closed near session lows on Tuesday and all but filled the gap left 10 sessions ago. Support crosses at 104.50 and 104.10. There is a long-term uptrend line which crosses at 101.00.

 
Nelson Notes from the desk of Rich Nelson
Analysis firms Safras & Mercado, Celeres, and Abiove all lowered Brazilian soybean production to 68.23, 69.8 and 69.5 million tonnes respectively. The USDA estimate was 72 million in February.

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 Leads Price Decline

Mar 06, 2012

Good Morning! Paul Georgy with early morning comments for March 6, 2012 at 5:00 am. Grain Markets are lower on profit taking and macro market selling pressure.  Risk-off selling pressure is seen across the commodity complex this morning. This week we have some major reports. On Friday, the USDA will release the March Supply and Demand report at 7:30 CST. Trade will be looking for changes in the US corn and soybean ending stocks as well as adjustments in the South American corn and soybean production data. We have some US economic data which could have an impact on macro markets. Private debt holders will vote Thursday on the acceptance of the Greek debt swap offer. Argentina dock workers strike has been settled but now truckers are expected to strike next week. Weather is continually being touted as bullish or bearish but in reality it will be a few weeks before US weather will go to front of the line for market impact. Livestock futures fell sharply Monday on news that China’s economy is expected to slow which could have an effect on export. Technical chart support points could uncover more selling if penetrated (see Allendale Advance Charts). Cutout values were mixed with choice down .08 and select up .39. Pork cutout values were down .17 on Monday. I am looking forward to seeing many of you in Riverside later this morning. Don’t forget to fill out the survey on Planting Intention. We will release the result on the 16th at 7:30.
 
Markets as of 5:00 AM
Corn    -6 to -8                        Live Cattle     -80 to -100                  US Dollar Index         +.42
Beans -1 to -3                        Lean Hogs      -75 to -135                  Crude Oil                    -.65
Wheat -10 to -11                   S&P Index      -11.75                         Gold                            -16.60
 
Allendale Advanced Charts
Cattle dropped sharply on Monday and settled near current uptrend support and 40 day moving average. Previous support at 129.50 now becomes resistance. Be aware that a close below uptrend support line and last week’s low of 127.92 could trigger more selling.

 
Nelson Notes from the desk of Rich Nelson
Here’s the most recent changes in the CFTC’s Managed Money category. This group is commonly referred to as "the funds".
 
          Corn   Soybeans   Chi Wheat   KC Wheat    Cattle      Hogs
2/14    -4,031    +18,186    -13,572     -3,671    +1,903     -883
2/21   -23,104   +15,929     -12,825    -3,429   +9,415    +1,805
2/28   +32,739    +20,707      +9,270     -1,289      +201    -2,878

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.

Tight Supplies Battle Outside Influences

Mar 05, 2012

Good Morning! Paul Georgy with early morning comments for March 5, 2012 at 5:05 am. Commodity futures are mixed this morning. Grain markets are battling between tight stocks and outside influences. The tight stocks of corn in the US and the inability of South America to export corn and soybeans on a timely basis have been positive to prices. The tug-o-war for planted acres of corn and soybeans is providing underlying support. Outside markets such as gold, crude oil and the dollar are not bullish at this time. Traders will be watching for headlines out of EU and China this week regarding their financial policies. Allendale will be continuing its survey of producers to gather planting intention data. We will release our findings on March 16, 2012. You help is greatly appreciated. The cash cattle marketed traded 1.00 higher than last week on Friday at 129 to 130. Beef prices were under pressure with choice down .38 and select down 1.35. Pork cutout values were up .27. The spread between cattle and hogs has been the major influence in futures. We are calling cattle and hog futures to open steady to better. Look forward to seeing many of you tomorrow at the meeting in Riverside, IA at 9:30 AM.
 
Markets as of 5:05 AM
Corn    +1 to+3                       Live Cattle     steady better              US Dollar Index         +.03
Beans -3 to -4                        Lean Hogs      steady better             Crude Oil                    -75
Wheat -2 to -3                       S&P Index      -6.25                            Gold                            -11.90
 
Allendale Advanced Charts
The soybean market has been in an uptrend since early December. The May contract needs to hold the 13.00 area and then 12.60 level to maintain this long-term trend.

 
Nelson Notes from the desk of Rich Nelson
Liu Yonghao, the head of New Hope Group, told reporters that China should open its feed grain import and export policy. He noted tight government controls over corn imports has led to agriculture market inefficiency. Allendale could not agree more. Corn in the southernmost import port is priced at $8.48 per bushel in China. Corn in their hog growing areas can be found at $10.12 per bushel.

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.

Energies and Grains Lower as the Dollar Strengthens

Mar 02, 2012

 

Good Morning! Steve Georgy with early morning comments for March 2, 2012 at 5:15 am. Grain futures are lower as the dollar finds strength to finish out the week. News is light this morning but the energies and the dollar will need to be watched close. If the dollar can push above 79.50, the charts will have taken out the downtrend it has been forming since the first of the year. The funds have been increasing their positions in commodities due to inflationary concerns and the falling dollar. If the dollar continues its path higher, we may start to see money come off the table and funds reduce positions. Crude jumped above $110 a barrel yesterday after the pit sessions were closed. This excitement was caused by a story of a pipeline explosion in Saudi Arabia. This news was released by an Iranian media source. This morning Saudi Arabian officials are denying this explosion even happened. This story will need to be watch closely because it shows how fast money is ready to move if geopolitical tensions continue to build. Cattle are working slightly higher this morning after a nice rebound yesterday. With the strong dollar we could see profit taking now that we are near resistance again. Box beef had Choice down .35 with Select unchanged. Trades this week is steady with last week at $128. Hogs are slightly higher as well. Cash hogs have been flat to .75 lower per hundredweight this week. Weak wholesales pork prices and negative processing margins caused most packers to bid cautiously for additional loads. Allendale needs your help on our 23rd annual planting survey. Go to www.allendale-inc.com and fill in your data.
 
Markets as of 5:15 AM
Corn    -2 to -3                        Live Cattle     +05 to +10                  US Dollar Index         +.35
Beans -2 to -3                        Lean Hogs      +15 to +30                  Crude Oil                    -75
Wheat -3 to -4                       S&P Index      -3.00                            Gold                            -5.10
 
Allendale Advanced Charts
Beans broke the 5-day trend of posting a new high for the move today as the market failed to trade above yesterday’s high. However, the market closed up near session highs , so we won’t count the bulls out just yet.

 
Nelson Notes from the desk of Rich Nelson
The last two weeks of soybean sales have shown a dramatic improvement. Old crop sales last week, at 20 million bushels, were the largest sale for this week in five years.

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 React to Dollar Strength

Mar 01, 2012

 

Good Morning! Paul Georgy with early morning comments for March 1, 2012 at 5:15 am. Grain futures are lower on profit taking after the US Dollar rallied late yesterday. Comments from Fed Chairman Bernanke that QE3 is not likely at this time and the ECB’s LTRO suggesting the 530 billion Euros which it dumped into the system may be the last caused profit taking in gold and silver. The euro dropped sharply which has strengthened the dollar. This news took the air out of the inflation scenario on Wednesday. The grain markets have received a benefit the past several days as money was trying to find a place to go. The weather in South America has given good coverage rains through Argentina and Southern Brazil. Moisture in the form of snow will help relieve some of the dry conditions in the US northern plains. The ISDA is the industry group that determines whether Credit Default Swaps have been triggered. Today’s ruling is only expected to determine whether or not the ECB’s preferential bond swap agreement with Greece triggered a default. Ethanol news is not supportive for the moment. Gasoline usage is declining and ethanol prices are near 14 month lows. Ethanol supplies in storage continue to grow weekly. Export shipments of ethanol to Brazil have been curbed due to Brazilian sugar price decline. Nearby corn and soybean futures should find support on setbacks as long as farmers hold grain. March 30 Planting Intentions report will keep spreads volatile between corn and beans. Allendale needs your help on our 23rd annual planting survey. Go to www.allendale-inc.com and fill in your data. Export sales will be released at 7:30. Traders are expecting wheat sales of 500 to 700 tmt, corn sales 650 to 850 tmt, soybeans sales 400 to 800 tmt, soymeal sales 75 to 150 tmt and soyoil sales 5 to 25 tmt. The livestock futures closed sharply higher on Wednesday but the late rally in the dollar has traders taking some profits overnight. Cash markets were inactive with choice beef up .15 and select up .47 on a load count of 264. April cattle futures have retraced approximately 50% of the recent sell-off. A close above 130.00 is needed to rekindle hopes of making a new contract high. April hogs remain in a slight uptrend with resistance at 91.00. Only a few days left before the Riverside IA meeting, please reserve your seats today.
 
Markets as of 5:15 AM
Corn   -3 to -4                        Live Cattle     +02 to +10                  US Dollar Index        -.01
Beans -3 to -6                        Lean Hogs      -20 to -30                    Crude Oil                   +37
Wheat -3 to -5                       S&P Index     +1.00                           Gold                            +4.70
 
Allendale Advanced Charts
KC wheat poked above the long-term downtrend on Wednesday, but settled back below it. Recently the market bounced off the uptrend support line. These trend lines have created a wedge formation which could have significant impact on the direction of breakout.

 
Nelson Notes from the desk of Rich Nelson
The Department of Commerce revised its estimate of fourth quarter Gross Domestic Product up from its previous estimate of 2.8% to 3.0%. This increase in growth, compared with Q4 2010, may help stabilize the US dollar index.
 
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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