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July 2011 Archive for Chip's Chore Time

RSS By: Chip Flory, Pro Farmer

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm. In fact... I don't even have horse chores to do any more!

July 25 Pro Farmer Monday Morning Wake Up Call

Jul 25, 2011

Chip Flory

Every Monday morning, Pro Farmer editors record the "Monday Morning Wake Up Call." It's a recorded message available by clicking here.
 

But... if you'd rather read the report instead of listening, each Monday morning I'll update the copy from the call here to help set your agenda of key issues that will be impacting the grain and livestock markets in the week ahead.

Monday Morning Wake Up Call

Good morning ... this is your July 25th edition of the Pro Farmer Monday Morning Wake Up Call.

House GOP leadership talks with President Obama reached a clear impasse late Friday, although all sides are still talking with each other. But the latest strategy has leaders in the House and Senate working on their own debt limit/budget cut proposals. The House plans to vote on its fast-changing plan on Wednesday. If that proposal includes balanced budget language, Senate Democrats will not vote for it and the focus would turn to Democratic Majority Leader Harry Reid's (D-Nev.) plan, which currently does not have any cuts in entitlement programs, a move guaranteed to bring strong GOP opposition. President Obama is now mostly on the sidelines, but insists he would veto any short-term plan and he instead prefers a debt limit extension that goes into 2013.

Grain futures were under pressure overnight with better-than-expected rains moving across key areas of the Corn Belt over the weekend. O’Hare airport in Chicago actually saw the wettest 24-hour period on record with nearly 7 inches of rain. Rains in Illinois, however, were very inconsistent – too much in the north and not nearly enough in the middle of the state. The Corn Belt forecast for this week includes some hot temps, but it also includes another shot of rain to help offset some of the heat stress. It should be a “good week” for the corn crop.

This afternoon’s Crop Condition Report is expected to show steady to slightly lower corn and soybean ratings. Most importantly, we’ll focus on how much of the corn crop is silking as of July 24, compared to the 35% silking pace on July 17. That change will give us an idea of how much of the U.S. corn crop pollinated during last week’s hot temperatures.

Friday’s Cattle on Feed Report will be slightly negative for live cattle futures today. More cattle on feed than expected means a slightly bigger supply of beef, but it should also be a positive for corn prices as it suggests bigger-than-expected corn-for-feed demand. The twice-yearly Cattle Inventory Report showed continued slow contraction of the beef herd with no indication of herd rebuilding at this time. Long-term, that should be supportive for cattle prices.

That’s your Pro Farmer Monday Morning Wake Up Call.

July 18 Monday Morning Wake Up Call

Jul 18, 2011

Chip Flory

Every Monday morning, Pro Farmer editors record the "Monday Morning Wake Up Call." It's a recorded message available by clicking here.
 

But... if you'd rather read the report instead of listening, each Monday morning I'll update the copy from the call here to help set your agenda of key issues that will be impacting the grain and livestock markets in the week ahead.

Monday Morning Wake Up Call

Good morning ... this is your July 18th edition of the Pro Farmer Monday Morning Wake Up Call.

Weather will be the driving factor in the grain markets again this week. The early week weather update suggests the heat wave across the country won't be quite as severe or last quite as long as indicated in last Friday's forecast. That slight change in the outlook is the reason corn futures were under hefty pressure overnight, putting spillover pressure on soybeans and wheat. Based on overnight action at the slight change in the forecast, traders are looking for corn to open 13 to 15 cents lower; soybeans seven to 10 cents lower; and wheat 10 to 15 cents lower.

It will be a busy week in Washington. Critical discussions about raising the debt limit while reducing the budget shortfall will continue to dominate headlines. The House will do some "Grandstanding" this week by likely passing a proposal that would boost the debt ceiling, but only if congress also passes a constitutional amendment requiring a balanced budget. It seems like a great idea to many... but the Senate won't pass that bill. In the Senate, the focus will continue to be on reaching a deal to raise the debt ceiling. This morning, Treasury Secretary Tim Geithner said progress is being made and that he believes federal default has been taken off the table. That's helping support the U.S. dollar ahead of the grain market open, which could add to what is expected to be heavy pressure on the grain open.

Critical crop updates will come this afternoon in USDA's Weekly Crop Progress and Crop Condition Reports. Expect a mixed bag in the condition update. The corn crop in many areas is showing very little stress despite high temperatures. But, there are areas where soils are too dry and temps are too hot as the corn crop attempts to pollinate. Many areas will "survive" the week ahead with minimal yield impacts, but some areas will see corn yields slashed.

USDA will also release the July Cattle on Feed Report this Friday. After a sharp drop in cash cattle prices last week as the boxed beef market appeared to put in a short-term top, traders will start this week with a negative bias toward prices. Cash hogs are called steady, but bids should firm to keep supplies moving to town despite hot temps.

That’s your Pro Farmer Monday Morning Wake Up Call.

July 5 Monday Morning Wake Up Call

Jul 05, 2011

Chip Flory

Every Monday morning, Pro Farmer editors record the "Monday Morning Wake Up Call." It's a recorded message available by clicking here.
 

But... if you'd rather read the report instead of listening, each Monday morning I'll update the copy from the call here to help set your agenda of key issues that will be impacting the grain and livestock markets in the week ahead.

Monday Morning Wake Up Call

Good morning ... this is a special Tuesday morning edition of Pro Farmer’s Monday Morning Wake Up Call for July 5. We hope you all had an enjoyable and safe Independence Day celebration!

Grain futures were higher overnight after a very volatile week last week. To establish a short-term low, market bulls, however, want to see some followthrough buying during the day session.

One of the biggest reports coming this week for the grains will come this afternoon in the Weekly Crop Condition Report. Traders were surprised by the slight downtick in conditions in the week ended June 26. With dry conditions last week on a shallow-rooted eastern Corn Belt corn crop, don’t be surprised if the crop conditions deteriorate just a bit in this afternoon’s update.

The weather forecast for this week calls for mostly seasonal temps, but the chance for widespread rain is relatively light. Most areas of the Corn Belt are expected to see below-normal rains for the week.

Just as important as the Crop Condition Report will be the attitude of speculative traders in the corn pit as we start the second half of the year. Much of the recent pressure on corn futures was the result of very aggressive speculative long liquidation. Everybody will be watching the spec action early this week to figure out if the big professional trading funds have decided to get back onto the long side of the market.

Traders will also keep a close eye on corn export demand this week. The recent price slide has attracted increased export demand from Asia and there is plenty of talk in the markets this morning about increase Chinese corn demand.

From Washington this week, there will be major oversight sessions on the conservation and specialty crop programs, a look at the E-15 blending rate, and the impact of the GIPSA livestock marketing rule on small businesses. Senate Democrats will also meet several times with President Obama and other White House officials on the debt-ceiling talks. There have been no sessions scheduled between Obama and Republicans at this time.

That’s your Pro Farmer Monday Morning Wake Up Call.

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