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.
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