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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.
 

Liquidation Pressures Grains

Feb 12, 2013

Good Morning! Paul Georgy with early morning comments for February 12, 2013 at 4:40 am. Grains are lower on follow-through selling and liquidation of longs. The USDA Baseline yield number of 163.5 for #corn released yesterday has given the trade expectations for 2013. The USDA will not present their official estimates for 2013 until the Agriculture Outlook Forum next week. As we presented at the Allendale Conference in January a corn yield anywhere close to trend could leave a carryout for 2013/14 near 2.0 billion bushels. We are nearing the end of the weather market in South America. With recent rains in Northern Argentina and Southern Brazil crops are looking much better. Southern Argentina remains moisture deficient, however some weather models have rain in the forecast. Temps are not extremely hot which has helped reduce crop stress during the dry period. We are now hearing talk that Brazilian port workers are going to strike starting Feb 19. They have a history of walking out at a time when the world needs grain. Safras says #bean harvest in Brazil is 10% completed versus 6% average.  NOPA will release January crush data on Thursday. Goldman Sachs cut their price forecast for grains, citing improved confidence in South American production. Chart resistance now crosses at the January low (5.70) in Dec corn while support in November beans crosses at the January low (12.59). China, Malaysia and South American markets are closed today. Meat demand is stifling any rebound in cattle and hogs.  Boxed beef was mixed with choice up .60 and select down .47. Pork cutout values were down .54 on Monday. The poor margins for both cattle and hog packers is weighing on cash prices and futures. Feeder cattle index is down .61 to 144.82. Next week, Monday and Tuesday I will be in Watertown, SD and Mankato, MN presenting an Allendale Outlook for Legend Seeds. You are welcome to attend, admission is free and lunch will be served. You can find all the details and register at http://www.allendale-inc.com/upcoming-events/.
Markets as of 4:40 AM
  • Mar Corn    -5 3/4
  • Mar Beans   +1 3/4
  • Mar Wheat   -3
  • Feb Cattle  -.10
  • Feb Hogs    -.60
  • Mar Dlr     +.12
  • Mar S&P     -1.25
  • Mar Crude   -.21
  • Feb Gold    -5.80
Contact Allendale: 800-262-7538 service@allendale-inc.com www.allendale-inc.com

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