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May 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.
 

Market Trade in Narrow Range Overnight

May 31, 2012

 

Good Morning! Paul Georgy with early morning comments for May 31, 2012 at 5:10 am. Corn and soybean futures are mixed in narrow range trading. Weekly ethanol production will be out on today and weekly grain exports sales will be out tomorrow morning. Traders want a confirmation that the rain moving across the Midwest will provide the moisture needed to hit trend yield before they become more aggressive sellers in new crop corn. If rains meet expectations it is likely to see more producers selling old crop corn next week. Even with China’s economic slowdown there are estimates which increase their purchases of soybeans this year. Stevedores strike in the Brazil port of Santos is threatening shipments out of that region. Month end today could suggest more margin pressure on old crop/new crop spreads. As we start June, the trade will be getting prepared for the June 12 monthly USDA supply and demand report and large funds rolling positions. The Greek parliamentary election polls are too close to call a winner. The Greek election is set for June 17. Cattle fundamentals are a little weak right now. Weekly beef production levels will likely not peak until sometime from mid-June to mid-August. Boxed beef was higher yesterday with choice up 1.26 and select up .89. Hog slaughter has come into line with last year which should help support prices. Pork cutout values were up 1.95 on Wednesday. Stay in touch with Allendale on twitter or subscribe to Allendale Research Center. Listening to the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +0
Jly Beans   +1 3/4
Jly Wheat   -4 1/4
Jun Cattle +.05
Jun Hogs    +.55
Jun S&P     +6.00
Jun Dlr     -.21
Jun Crude   +.36
June Gold   +3.30
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Yesterday’s continued strength to new highs in the US Dollar has continued to add pressure across all commodities. A close below the 5/28 low of $81.90 is needed in order to negate the uptrend. Unless this level is violated, continued strength is expected
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Two separate groups now suggest a 39 million tonne production estimate is more appropriate for Argentine production. It will help the bullish cause for the short term but may not cause a real rally due to lowered Chinese interest right now…Rich Nelson
 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Old Crop/New Crop Corn Spread Is Key Concern

May 30, 2012

 

 

Good Morning! Paul Georgy with early morning comments for May 30, 2012 at 5:10 am. Corn and soybean futures are mostly lower on slump in outside markets. The old crop/new crop spread in corn seems to be the key concern to traders and producers as cash truck bids are running 70 plus over the July futures. It appears a squeeze is happening as there was so much talk of this spread going to 2.00 premium July. And then liquidation hit commodities and now we have an avalanche in this spread. There is an attitude of "get me out" and month end margin clerks saying "get out or get the margin in now". The nation as a whole lost 5% in today’s good to excellent ratings. Of the top three corn states Iowa lost 5% (now 77%), Illinois lost 13% (now 66%), and Nebraska improved by 1% (now 79%). Spring wheat crop conditions were 5% better than last week at 79% G/E. No soybean conditions yet. Many traders have discounted the conditions report saying it is just a beauty contest. We will have to wait until June 12 to see if USDA adjusts yields. Two SA firms have put out estimates for Argentina’s bean crop below the 40 million tonnes number. The USDA should revise Argentine production lower at least one more time this year. Oilseed crushers in Argentina will be striking over wages today. Macro influences like the downgrade of Spain’s debt and forthcoming Greek election are not supporting confidence for commodity investments. Livestock bulls are feeling a little hopeful right now. Last week’s kill was right where it should have been after four weeks of bloated levels. In addition, weekend meat demand may have been good as wholesale pork gained $0.86 today. Boxed beef was higher on Tuesday with choice up 1.11 and select up 1.75. It is good news for the three day demand period but we cannot say it will change much. Beef production is still lined up for an increase into mid-June. Stay in touch with Allendale on twitter or subscribe to Allendale Research Center. Listening to the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +1
Jly Beans   -10 1/2
Jly Wheat   -5
Jun Cattle -.30
Jun Hogs    +.07
Jun S&P     -11.25
Jun Dlr     +.18
Jun Crude   -1.18
June Gold   -1.00
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Yesterdays continued pressure in the July Corn took out the 5/11/12 low of $5.72 1/4. This is the lowest the July Corn has closed since the 1/04/11 close of $5.56. If we are to expect any sort of recovery in July Corn we must see a close above the 5/21/12 pivot high of $6.44 ½ in order to negate this downtrend going forward.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Monitoring Agricultural Resources, the crop forecasting unit of the European Commission, lowered its yield estimate for wheat from 5.68 tonnes per hectare to 5.62. This brings the total production of soft wheat down to 126.5 million tonnes. This would make USDA’s current 132.0 mmt estimate too high.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Weather and Investor Positioning Key to Month End

May 29, 2012

Good Morning! Paul Georgy with early morning comments for May 29, 2012 at 5:10 am. Corn and soybean futures are mixed. Some areas of Midwest are still getting rain this morning. Returning to McHenry from Southern IL yesterday in the 90 degree plus heat, I saw corn and soybeans showing significant stress in some areas and outstanding looking crops in other areas. A rain is welcome (the sooner the better) throughout the state of IL. A little moisture and the cooler temps in the forecast will help considerably. Next chance for a rain with good coverage is Thursday into Friday. Weather models have not changed from last Friday. The crop conditions report this afternoon will be watched closely. Remember due to the holiday on Monday many of the weekly USDA reports will pushed back one day this week. Celeres out of Brazil says that the Brazilian farmer has sold 27% of the 2012-13 soybeans crop 4 months before the start of planting. In Greece, the conservative party has gained back leadership in the polls and that is supporting the Euro. Managed money in the Commitment of Traders report increased long positions in corn by 25,355, reduced bean longs by 15,781 and covered short wheat positions to the tune of 57,083. Leaving managed money funds with only 7,026 net short is certainly a reason for the rally in wheat last week. We will be watching for more adjusting of positions by funds as we approach month end. Friday meat values slipped with choice down .93 and select down 1.38. Pork cutout values were down .23. The packers have a short week and the meat clearance at the retail counter over the weekend will determine their attitude and aggressiveness in bids in the cash markets. Futures will be influenced by investor attitude and headlines out of Europe at 9:05 this morning. Stay in touch with Allendale on twitter or subscribe to Allendale Research Center. Listening to the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +1 1/4
Jly Beans   +10 1/4
Jly Wheat   -9 1/4
Jun Cattle stdy-firm
Jun Hogs    stdy-firm
Jun S&P     +6.50
Jun Dlr     -.17
Jun Crude   +.35
June Gold   +4.50
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Friday’s inside day continues to show the lack of conviction in the Dec. Corn. For the near term, the double top at $5.50 should cap the upside with a break of the 5/11 low of $4.99 low needed to start a new leg down. While we continue to advise producers to look to use rally’s in the Corn market to price corn we would advise to use options in order to minimize whipsaw risk.
 
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The Commerce Ministry of China has increased its estimate of May soybean imports dramatically. The agency estimates 7.22 million tonnes, a new record, will be imported. Previously the group was only looking for 5.63. Some Chinese industry sources are skeptical about the new numbers.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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 Gain Back Losses In Early Trade

May 25, 2012

Good Morning! Paul Georgy with early morning comments for May 25, 2012 at 5:10 am. Corn and soybean futures are higher. Markets are likely to see some adjusting of positions ahead of the long weekend and potential changes in weather forecast by Monday evening at 7:00 pm (remember that is when the grains open after the weekend). World Weather Inc. says, "The bottom line still brings hot, dry, weather to a big part of the Midwest (excluding the northwest) from now into Monday. After that, two frontal systems and a possible third will bring waves of light rain across the Midwest during the balance of the two-week outlook offering relief to the driest conditions." Weather forecast will play a huge part in the price direction Monday evening. June grain options will expire today at 1:15 and electronic futures continue to trade until 2:00 pm, stay tuned. The trade is waiting for an announcement from CME of trading hour adjustments on the days when major USDA reports are released. Kansas wheat harvest is underway with yields expected to be above average. China’s largest banks will not meet loan targets for the first time in 7 years due to economy slowdown. The Commodity Index has consolidated near the early August 2010 highs after the slide in the index since March 1, 2012. The EU PMI composite index is showing Germany and France are being hit by economic slowdown. This is increasing the drama with Greece. The weak EU financial news is continuing to create fund liquidation and a risk-off attitude in commodity investments. Choice beef prices were up .19 and select was down .81 on Thursday. Futures have stabilized since early in the week announcement of large beef and pork in cold storage. Stay in touch with Allendale on twitter or subscribe to Allendale Research Center. Listening to the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +9 1/2
Jly Beans   +4 1/4
Jly Wheat   +11 1/4
Jun Cattle +.25
Jun Hogs    +.30
Jun S&P     +3.25
Jun Dlr     -.29
Jun Crude   +.43
June Gold   +6.20
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Thursday’s continued strength in the US Dollar is applying pressure across the commodity spectrum. While the steepness of the trend line is a slight cause for concern, a break below the trend line and a confirmed close below the 5/22 low of $81.09 would be needed to negate the uptrend.
 
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The euro zone Purchasing Managers Index, a measure of economic activity at the wholesale level, fell to a reading of 45.9 this month. That is down sharply from 46.7 in April. Economists suggest this translates into a euro zone second quarter GDP falling by 0.5%.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

Expect More Volatility Due To Long Weekend

May 24, 2012

Good Morning! Paul Georgy with early morning comments for May 24, 2012 at 5:10 am. Corn and soybean futures are mostly higher 0n short covering. Weather forecasts for next week are putting significant moisture northwest of a line from Omaha to Minneapolis. Southwest of the line .5 to 1 inches should fall and less the further east you go. The high temps pushing into the Midwest this weekend will intensify concerns for rainfall on the Monday night forecast. Weekly export sales data will be released at 7:30 this morning. Traders are expecting strong sales estimates for corn and soybeans. Trade estimate for corn 1.000 mmt to 1.300 mmt, soybeans 1.000 mmt to 1.250 mmt, meal 100 to 200 tmt, soyoil 15 to 20 tmt and wheat 350 to 550 tmt. Traders will be combing this report for switching or canceling of purchases by China. Traders are concerned about China’s reserve soybean auction today and how much more will they sell. Wheat yields are coming in from Kansas at 40 to 50 which are below expected a few weeks ago. The entire commodity markets have been under liquidation pressure this week due to macro market influences. The informal meeting in Brussels with European leaders will be discussing the possible exit of Greece from the EU. The political structure in Europe is shifting to an anti-austerity sentiment. This is causing investors looking for less risky investment. The CME Ag markets will be closed on Monday in observance of Memorial Day. However the opening time for grains Monday evening will be 7:00 pm instead of the regular 5:00 pm. CME held a meeting yesterday afternoon on extending trading hours of open outcry during USDA reports, but no comments or decisions yet. We expect some short covering before the long weekend and more fireworks Monday evening. Cash cattle traded at 121.00 yesterday which is 2.00 lower than last week. Boxed beef was higher as choice was up 1.09and select was up .61. Pork values slide another 2.09. Lean hog futures have continued under pressure due to the strong dollar which suggests fewer exports. Get the Export data results by listening to the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +1 3/4
Jly Beans   +11
Jly Wheat   +5 1/4
Jun Cattle -.22
Jun Hogs    +.07
Jun S&P     +4.75
Jun Dlr     +.01
Jun Crude   +.72
June Gold   +14.00
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Wednesday’s weak trade in live cattle has confirmed the 5/21/12 high that this market must trade above in order to resume its uptrend. The uptrend in Live Cattle is still intact as long as the 5/11 low of $114.80 holds
 
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
There is talk that China has cancelled some purchases of US soybeans due to negative crush margins. We currently have 1.854 million tonnes of sold old crop soybeans that have not been shipped yet for China. Our new crop bookings for China total 8.027 million tonnes.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

Farmers Expected to Shut Off Cash Sales

May 23, 2012

 

Good Morning! Paul Georgy with early morning comments for May 23, 2012 at 5:10 am. Thanks to all who attended the Ag Leaders Webinar Live! If you have any unanswered questions give us a call or email. Corn and soybean futures are mostly lower led by wheat. Rains in Russia and strength in the dollar seem to be the catalyst for lower prices this morning. Weather models turned wet for next week in the Midwest and the dome of heat disappeared in the 10 to 15 day model runs. The heat this weekend will last only a few days. The fact that various models are agreeing on good moisture coverage of the Corn Belt that far out is providing selling pressure from the trade. Yesterday grain traders were hit with unconfirmed rumors such as China possibly canceling or rolling purchases of corn and possibly a large fund liquidating positions and shutting down. China will auction 600,000 tonnes of reserve soybeans on Thursday. We are starting to hear HRW yields out of TX and OK which are termed as good. Next week harvesters should get into southwest KS where yields are expected to be poor. There are reports coming out of Brazil putting next year’s bean production at 80 mmt vs. 65 mmt this year for Brazil. Several grain contracts closed below major moving average support levels. A strong close will be needed today negate the trend. The macro market is very concerned about the Euro situation as government leader’s change and austerity plans come into jeopardy. We should be in for more volatility through the balance of the week especially with a holiday on Monday and markets will be sensitive to weather forecasts. Boxed beef values were mixed on Tuesday, choice was down .31 and select was up .57. Fill-in buying for holiday featuring by retailer should be complete and likely will pressure beef values for balance of the week. Cash cattle markets are still at a standoff as packers will need fewer cattle next week. Cold storage numbers were larger than expected for beef and pork. Check out detailed analysis in yesterday’s livestock report. Pork cutout values were down 2.09. Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +1
Jly Beans   -17 1/2
Jly Wheat   -14 3/4
Jun Cattle +.02
Jun Hogs    -.82
Jun S&P     -9.00
Jun Dlr     +.27
Jun Crude   -.84
June Gold   -20.80
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Tuesday’s failure below the 5/16/12 $12.82 ¼ low opens up the prospect for an epic collapse in pricing in the weeks and months ahead. With no technical levels of substance coming in to play to support this market until the double bottom that was created in late November early December at $11.15 ¾ and $11.19 1/2 . If producers have not begun to price Nov. Beans action should be taken immediately.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
In the first crop rating of the year, USDA indicated 77% of the nation’s corn crop was rated as either good or excellent. That was far above the average guess of 70% among analysts. Corn planting is virtually complete at 96%.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Soybean Planting Progress Well Ahead of Estimates

May 22, 2012

 

Good Morning! Paul Georgy with early morning comments for May 22, 2012 at 5:10 am. Corn and soybean futures are lower on crop progress and profit taking. Tonight is Allendale’s Ag Leaders Webinar. Rich Nelson, Mike Kavanaugh and Frank LaPlaca will examine dry weather’s effect on crop conditions, grain acreage shifts and chart pattern price projections. You must register HERE to join meeting! The USDA gave us the 5th highest corn good to excellent conditions rating in the last 26 years. In the four years where we started with better conditions than this year there was an even split on yields above and below trend at year end. Planting progress in soybeans were 76% complete compared to 68% expected by trade. Weather forecasts are expected to dominate headlines and direction of futures as we approach the long weekend ahead. World Weather Inc.: "The bottom line leaves pressure on rainfall potentials for next week in the Midwest, Delta and southeastern states where the need for rain will be great after this week’s net drying. Some relief is most definitely anticipated, but how significant the rain is next week will be debated for a while..." Elevators are struggling with cash bid posting as settlement prices at CME are from 1:15 and markets trade until 2:00 pm. Reports that ag option traders are lobbying CME to extend option trading times from 7:20 am to 1:15 pm. The next USDA monthly supply and demand report is due to be released at 7:30 am on June 12. We hope things get settled by then. EU tensions have cooled off  but Merkel’s party in Germany is losing ground in upcoming elections. Cash cattle buyers will be looking at the short week ahead and will not need as many head. Fill-in buying for Memorial Day supported choice beef on Monday as prices were up 2.08 with select down .09. Pork cutout values were up .21. Hog futures were hit with bear spreading as firmer corn prices reduce profitability for producers. Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    -5 3/4
Jly Beans   -6 1/4
Jly Wheat   -17
Jun Cattle +.32
Jun Hogs    -.07
Jun S&P     -2.50
Jun Dlr     +.20
Jun Crude   -.61
June Gold   -12.40
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Monday’s trade in July Wheat fell short of taking out the 10/11/11 high of $7.30 1/2.  A close above the $7.30 ½ high creates a scenario in which the cap that has been on July Wheat for the past 7 months. A close below $6.60 would be needed to break the uptrend.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Between May 8 and May 15, Managed Money made the follow position changes in contracts…corn -34,656, soybeans -12,240, wheat -3,870, hogs +1,776, and cattle +1,334. Official stats for the move since last Tuesday have yet to be released.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

 

Weather Premium Being Added Quickly

May 21, 2012

Good Morning! Paul Georgy with early morning comments for May 21, 2012 at 5:10 am. Corn and soybean futures are mostly higher but well off the overnight highs. Memorial Day is normally known as the kick-off for cookout season and with the action in grain prices on Friday and overnight we have officially begun weather market season. World Weather Inc. said in last evening’s report, "the bottom line remains one of building concern over dryness in the southern and eastern Midwest during the next two weeks. Much pressure will be on the next week’s mid- to late-week rain event and because it is so far out in the forecast it must be viewed cautiously. Crop moisture stress is already an issue in southeastern Missouri, southern Illinois, extreme southwestern Indiana, Kentucky and areas southward into the Delta. Rainfall this week will be minimal in the region and that will likely maintain a need for significant rain. Some partial relief from dryness is possible today and Monday as scattered showers and cooler air move into the drier areas, but the relief will be quite limited and stress will be back again later this week and last into next week." The USDA will gives us the first crop conditions for corn this afternoon which will be watched closely by the trade. CFTC Commitment of Traders Report released on Friday showed funds liquidated another 38,000 corn contracts to put their lowest net longs to level not seen since 2010. The Greek elections will not be held for about a month but the Euro situation remains tense. Cattle on Feed report on Friday should support cattle futures this morning. Choice beef was up 1.41 and select was up .73 on Friday. Pork cutout values were down 1.20. Look for steady higher open for livestock. With the volatility in the Grain markets there is plenty of reason to attend the Ag Leaders Webinar  tomorrow evening, May 22. Join Rich Nelson, Allendale's Director of Research, as he examines potential grain acreage shifts and their impact on supply and futures ahead of USDA's big Grain Stocks report in June. We also will have Mike Kavanaugh, Agronomy Manager of AgriGold, to examine crop conditions and their corresponding yield potential. Frank LaPlaca will examine chart price projections. Register HERE!
 
Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +1 1/2
Jly Beans   +8 3/4
Jly Wheat   -3 1/4
Jun Cattle stdy-higher
Jun Hogs    stdy-higher
Jun S&P     +7.75
Jun Dlr     -.10
Jun Crude   +.33
June Gold   -.08
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Friday’s impressive trade in the Dec. Corn has created a base and reversal environment. While still capped by the down trendline these levels should be used to price further unprotected production.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Weather is now at the forefront of trade discussion. As noted above, no significant rain will be seen in most areas. Combined with above normal temps, we’re starting to see a weather story which helps counter trader uncertainties tied to Greece and the Euro.
 
 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

Demand Continues to Fuel Rally in Grains

May 18, 2012

 

Good Morning! Paul Georgy with early morning comments for May 18, 2012 at 5:10 am. Corn and soybean futures are lower. Watch for export sales announcements from USDA at 8:00 am. As we close out the week there are many factors driving market volatility in grains. Weather is dry in Russia and the western portion of the Southern US plains. Macro markets are very much on edge with Greece and the Euro situation. The NATO meeting in Chicago has traders reducing position size and some may not come to work on Monday. The option volume in the pits on the CBOT trading floor is still very important for market liquidity. The CME is still working on starting the expanded hours on Sunday but there is a greater probability it will begin on Sunday June 3. We will be waiting for an official announcement sometime today. Technical traders want a strong close for the week above key moving averages. Headline excitement will be needed to continue feeding the rally. Cattle futures have put together a string of positive days as traders expect cash markets to trade higher this week. Choice beef was up .12 and select was up .73. Pork cutout values were up 0.75. Cattle futures will likely see some two sided trade today ahead of "Cattle on Feed" report at 2:00 pm. Don’t forget to sign up for the Ag Leaders Webinar on May 22, 2012. Join Rich Nelson, Allendale's Director of Research, as he examines potential grain acreage shifts and their impact on supply and futures ahead of USDA's big Grain Stocks report in June. We also will have Mike Kavanaugh, Agronomy Manager of AgriGold, to examine crop conditions and their corresponding yield potential. Frank LaPlaca will examine chart price projections. Register HERE!
 
Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    -1/4
Jly Beans   -7   
Jly Wheat   -1
Jun Cattle +.27
Jun Hogs    +.32
Jun S&P     +5.25
Jun Dlr     +.09
Jun Crude   +.02
June Gold   +16.60
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Thursday’s strong close in the wheat market above the $6.55 ½ cluster high and down trend line that has capped the wheat market for the past 8months. Has created a base and reversal environment in which a neutral stance is advised in the near term. A close above the $6.80 ½ cluster high would confirm a new uptrend.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The government’s weather group, NOAA, gave its monthly update on long term weather this morning. Their previous forecast, for May – July called for normal temps and normal precip. The new forecast, for June – August, calls for normal temps for the main growing regions and normal precip.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Spreaders Focus on Tight Current Supplies

May 17, 2012

 

Good Morning! Paul Georgy with early morning comments for May 17, 2012 at 4:10 am. Comments are a little early this morning as I have to catch a flight to New York for the day. Corn and soybean futures are lower. Spreading old crop versus new crop and weather has taken the bite out of the bear. Large volume of spreads was done in corn beans and wheat yesterday. Dry conditions in Russia and Kazakhstan are becoming more serious as well as the western portion of the southern plains in the US. Large traders have been heavily short wheat. Until rains arrive, expect more short covering. Grains have been separating themselves from the chaos in the EU. Watch the headlines for further downgrades in investor confidence. CME grain trading hours will not change on Sunday. The CME withdrew the request for 22 hrs. sessions and will likely ask for a 21 hrs. session starting at 5:00 pm running through 2 pm the following day. Weekly export sales estimates for this morning are soybeans 1.0-1.3 mmt, soymeal 150-200 tmt and soyoil 30-50 tmt. Corn export sales are expected to range from 800 tmt-1.2 mmt. Wheat sales estimate is 450-750 tmt. Cattle on Feed report due to be released on Friday afternoon at 2 pm. Trade average estimates are for on feed to be 100.3%, placed 88% and marketed 98.4 of a year ago. Boxed beef values were lower and trading of cash cattle remain at a standstill. Choice beef was down .63 and select was down 1.98. Pork cutout values were lower by .31 on Wednesday. Trader will be further adjusting positions ahead of Friday’s report. Don’t forget to sign up for the Ag Leaders Webinar on May 22, 2012. Join Rich Nelson, Allendale's Director of Research, as he examines potential grain acreage shifts and their impact on supply and futures ahead of USDA's big Grain Stocks report in June. We also will have Mike Kavanaugh, Agronomy Manager of AgriGold, to examine crop conditions and their corresponding yield potential. Frank LaPlaca will examine chart price projections. Register HERE!
 
Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 4:10 AM
Jly Corn    -1
Jly Beans   +7
Jly Wheat   +3 1/4
Jun Cattle +.62
Jun Hogs    -.02
Jun S&P     +5.00
Jun Dlr     +.12
May Crude   +.35
June Gold   +11.40
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Wednesday’s continued strength in the US Dollar is a direct reflection of the panic in the Euro Zone. The steepness of the uptrend shows the flight to safety from the Euro to the US Dollar.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The China National Grains and Oils Information Centre expect corn production this year to total 197.5 million tonnes. This would surpass USDA’s estimate of 193 mmt and last year’s 191.75. Soybean production is seen at 13 mi. This is right on USDA’s 13.1 estimate and little changed from last year’s 13.5. Wheat production is expected at 120.3 mmt that is right on USDA’s 120.0 and a little above 117.92 last year.
 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Selling Momentum Continues in Grains

May 16, 2012

 

Good Morning! Paul Georgy with early morning comments for May 16, 2012 at 5:10 am. Corn and soybean futures are lower with spreaders being very active. Technical selling and more risk-off attitude dominate overnight trading. Dry weather in the Midwest over the next 10 days is generating some talk but planting progress and great stands of corn are not allowing much momentum to that thinking. The Ukraine and Russia spring and winter crop regions have rain in the forecast but never seems to arrive. This area will have to be watched closely over the next several weeks. Macro market influences such as elections in Europe will continue to be watched closely. Greece will be holding another election next month with an attempt to put together a parliament. The talk of Greece leaving the EU is sounding more like one of those events where you "sell the rumor and buy the fact". "Only time will tell!" Watch for sales announcements at 8:00am. Cattle traders received some positive news late yesterday when USDA released the daily boxed beef prices. Choice was up .58 and select up 1.58. Pork cutout values were up another .25 on Tuesday. Lean hog futures accelerated to the upside after breaking through the 20 day moving average. We believe it is likely the seasonal lows have been established in the pork complex based on fundamental analysis. Join Us May 22, 2012 for Ag Leaders Webinar as Rich Nelson, Allendale's Director of Research, examines potential grain acreage shifts and their impact on supply and futures ahead of USDA's big Grain Stocks report in June. We also will have Mike Kavanaugh, Agronomy Manager of AgriGold, to examine crop conditions and their corresponding yield potential. Frank LaPlaca will examine chart price projections. Register HERE!
 
Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    -4 1/2
Jly Beans   -21
Jly Wheat   -1 3/4
Jun Cattle +.25
Jun Hogs    +.02
Jun S&P     -2.25
Jun Dlr     +.25
May Crude   -1.72
June Gold   -21.40
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Taking out the 5/1/12 $86.55 highs confirms a base and reversal in the Lean Hogs. An uptrend is in place unless the $84.17 ½ low is taken out.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The Bureau of Labor Statistics reports April CPI at only 2.3% higher than last year. This was down from the March level of +2.6%. Food prices also fell from a 3.3% growth in in March to 3.1% growth in April.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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 and Soybean Planting Pace Well ahead of Average

May 15, 2012

 

Good Morning! Paul Georgy with early morning comments for May 15, 2012 at 5.10 am. Corn and soybeans futures are higher on short covering in the oversold grain complex. The USDA put corn planting progress at 87% versus 56% last year and 66% average. Soybean planting was within trade estimates with 46% complete. The weather forecast for the next 2 weeks should give farmers the chance to finish corn and soybean planting. There are a few traders touting a concern about it being too dry in some areas. Macro markets are the dominating factors as Greece’s inability to form a government after last week’s elections puts the EU bailout plan at risk. Greece also has a bond payment due which should help determine money flow. The CME expanded trading hours for grains will be starting next Sunday at 5:00 PM. Join Us May 22, 2012 for Ag Leaders Webinar as Rich Nelson, Allendale's Director of Research, examines potential grain acreage shifts and their impact on supply and futures ahead of USDA's big Grain Stocks report in June. We also will have Mike Kavanaugh, Agronomy Manager of AgriGold, to examine crop conditions and their corresponding yield potential. Frank LaPlaca will examine chart price projections. Register HERE! Boxed beef was higher on Monday with choice up 1.93 and select up 2.65. The slowdown in slaughter is finally having an effect on meat demand. The warmer weather over the weekend has helped the retail clearance of beef. Futures traders will be adjusting their positions ahead of Friday’s cattle on feed report. Technical action on Monday should provide further support today.
 
Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    +6
Jly Beans   +18 3/4
Jly Wheat   +6 1/2
Jun Cattle +.52
Jun Hogs    +.42
Jun S&P     +9.50
Jun Dlr     -.07
May Crude   -.01
June Gold   -2.10
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Yesterday’s trade in the Dec Corn implies that the selling pressure could be slowing down. With the RSI* momentum indicator implying an "oversold" condition a close above the 5/10/12 $5.19 ¼ high is needed to confirm this as an applicable trading tool. However if the Dec Corn sees a sub $5.00 close further price protection is advised for producers.
 
RSI(Relative Strength Index is a technical tool used to gauge the strength of a market versus the closing prices of a given look back period. For our purposes yesterdays close vs. the close nine days ago. However trading decisions based only on the fact that a momentum indicators such as RSI are implying an oversold condition are foolish. That is why we need to see confirmation in pricing first in order to use RSI as an applicable trading tool.)
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Soybean crush for the month of April totaled 131.708 million bushels according to this morning’s NOPA report. That was a little under the expectation of 134.8. Allendale does not call this bearish however as it represents a sharp 9% increase over last year. It is likely 2011/12 crush with total 1.660 billion as opposed to USDA’s current 1.645 estimate. 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Large Traders Continue To Reduce Positions

May 14, 2012

Good Morning! Paul Georgy with early morning comments for May 14, 2012 at 5.10 am. Corn and soybeans futures are lower. Investor confidence is shattered due to fundamental and technical issues. The election results out of Germany are creating further concerns for the Euro. The political deadlock in Greece has EU officials weighing an exit plan. China cut their reserve rate but economic data suggests a slowing economy. The CFTC data released late Friday showed managed money reducing long positions in grains at CBOT by 38,726 contracts. The weather forecast for most of the Midwest is dry for the next 10 days which should give producers a chance to finish up planting of corn and many cases soybeans. The weekly progress report will be released to at 3:00 pm. Price of corn has slipped to levels where buyers have shown interest. Watch for new sales announcements at 8:00 am daily. The ICE exchange started trading corn and beans last night. The CBOT will begin trading extended hours next Sunday at 5:00 pm. The boxed beef value was lower on Friday, choice down .82 and select down .81. Pork cutout was .43 higher. We will be waiting for reports on retail clearance this past week. The meat markets will be taking their cue from the stock indices at 9:05 however lean hog futures did put in a solid performance on Friday. Check out the Allendale "Morning Coffee" on YouTube at 8:00AM.
 
 
Markets as of 5:10 AM
Jly Corn    -3
Jly Beans   -25
Jly Wheat   -2 1/4
Jun Cattle stdy-lwr
Jun Hogs    stdy-lwr
Jun S&P     -11.75
Jun Dlr     +.34
May Crude   -1.99
June Gold   -20.90
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Friday’s outside range day has taken out the 4/18/12 support of $14.09 ½. If we do not see the July beans hold the trend line support at $13.88 ½ a priced stance is advised for producers.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Energy prices are falling. June crude oil has come off its March highs of 110.55 and is now priced at 95.60. This move has a bearish influence on corn and soyoil as those products derive a portion of their pricing from energy.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

Cash Corn Stocks Tight Until New Crop Arrives

May 11, 2012

Good Morning! Paul Georgy with early morning comments for May 11, 2012 at 5.25 am. Corn and soybeans futures are lower. Now that the USDA data has been released, the traders will be analyzing and adjusting the numbers to what could be expected on the next report. Traders will be watching for export announcements at 8:00 this morning as nearby corn is trading below the important 6.00 area. We believe cash corn will still be king for several weeks as supplies will be tight until new crop corn can be harvested. Weather forecasts should give farmers a chance to finish up corn planting and get a considerable amount of beans planted. The outside markets are quiet as we end the week. Watch for new developments in Europe over the weekend. Don’t forget managed money has a record long position in soybeans. The CFTC will give us updated numbers this afternoon on the Commitment of Traders Report. Cash cattle trade was at a standstill on Thursday with very light interest. Boxed beef values were lower with choice down 1.59 and select down 2.09. Pork cutout values were up 1.96. A strong close for the week is necessary to give hope the seasonal lows are in. Stay in touch with Allendale Research at www.allendale-inc.com.
 
 
 
Markets as of 5:25AM
Jly Corn    -4 3/4
Jly Beans   -17 1/4
Jly Wheat   -3
Jun Cattle -.62
Jun Hogs    -.02
Jun S&P     -6.50
Jun Dlr     +.07
May Crude   -.95
June Gold   -13.00
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Thursday’s break below the 4/18/12 low of $5.91 ¾ opens up the July Corn market to a potential test of the 3/15/2011 low of $5.68 1/2. A close above the 5/08/12 high of $6.32 is needed to neutralize the down trend.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
While the trade was expecting a decrease in old crop stocks, from 801 to 749 million bushels, USDA actually increased stocks to 851 (lowered feed and residual). The trade was expecting new crop ending stocks to jump to 1.714 billion. USDA surpassed that with a 1.881 billion estimate. Yield was adjusted to 166.0 as Allendale had discussed before due to strong early plantings. World corn stocks will jump from 127.56 million tonnes old crop to 152.34. That was much higher than expectations of 136.822. 
 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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 Crop Report to be Released at 7:30 AM

May 10, 2012

Good Morning! Paul Georgy with early morning comments for May 10, 2012 at 5.10 am. Corn and soybeans futures are higher. The USDA supply demand report has traders doing last minute adjusting this morning. The trade is expecting 2011-12 corn carryout to tighten from last month’s 801 to 749 in today’s report. The production, usage and ultimately the ending stocks for the 2012-13 crop will be very important. This will be the first USDA estimate for the new crop marketing year and the numbers trade analyst will base their projections for the balance of the year. The 2012-13 carryout for corn is 1.704, soybeans .170 and wheat is .805. Demand from the PRC will be scrutinized. Production estimates for Argentina and Brazil will be watched closely because the last USDA number is well above recent forecast coming out of South American. Soybean ending stocks are expected to be down 30 million bushel from last month for 2011-12. And 2012-13 trade average estimates are 170 million bushel. Macro markets are likely to become a factor after the report data is digested as Greece, Spain and Portugal assess their future in the Eurozone. Weather, cash markets and export activity will also come into focus after the market has a chance to adjust for the new data. With the strength in cattle futures, feedlots are asking more money than last week. Packer margins are now in the black while feedlot losses are more than 100 per head.  Gas prices going down may give families a little more money to spend on meat. Choice beef was up .69 and select was down .04 on Wednesday.  Pork cutout values on Wednesday were down .71. Get the details of the USDA report on "The Morning Coffee" by 8:00 am on YouTube. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:10AM
July Corn    +4 1/4
Jly Beans   +14 1/4
Jly Wheat   +4 3/4
Jun Cattle +.02
Jun Hogs    -.15
Jun S&P     -1.25
Jun Dlr     +.08
May Crude   -.64
June Gold   -7.00
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
July Beans recent correction has reached a technical area of great importance. While the uptrend line is still intact, a close below the 4/18/12 low of $14.09 ½ could imply a complete breakdown of prices. A recovery attempt above the 5/01/12 pivot high of $15.12 ½ could create a scenario in which the Bean market makes a run at the 7/03/08 contract high of $16.63.
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
With no clear leading party from recent Greek elections, and no clear plan to continue austerity measures, an executive board member of the European Central Bank raised the idea of Greece leaving the euro. This is the first public discussion from an ECB official about this possibility. A weaker euro and stronger US dollar is bearish to US commodities.
 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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 in Trading Range until Report?

May 09, 2012

 

Good Morning! Paul Georgy with early morning comments for May 9, 2012 at 5.10 am. Corn and soybeans futures are lower as outside markets create concern for investors. Corn futures are in a trading range while cash market leads the charge higher. Tight stocks and empty bins in central IL have processors raising bids to get grain. We expect to see more jockeying of positions ahead of Thursday’s report which could be a significant game changer. The trade is looking for bullish old crop corn numbers and bearish new crop. Traders are expecting bullish bean data tomorrow at 7:30. The report is very important because we will get the first estimates on 2012-13 crop of which analysts can base projections. The heightened political unrest in Greece and the change in governing power in France and Italy are causing a reduction in large trader participation in commodity markets. These events have money managers very nervous about building positions in commodities. Weather forecast suggests farmers will have an extended period to get the balance of crops in the ground. Russia and Ukraine are expected to receive rain this week. Livestock markets struggle with demand not keeping up with supply. The milder winter had hogs and cattle gaining faster than normal. Export demand has slowed as China’s pork prices have been declining due to seasonal consumption.  Many are looking for US consumption to increase when the cookout season gets into full swing. Cash cattle could trade higher this week while dressed beef is struggling to make new highs. Choice was up .34 and Select was up 1.31 on Tuesday. Pork cutout was up .42 yesterday. Follow us on twitter at Allendale_paul. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:10AM
Jly Corn    -2 3/4
Jly Beans   -9 1/2
Jly Wheat   -8 1/4
Jun Cattle +.12
Jun Hogs    +.02
Jun S&P     -8.00
Jun Dlr     +.29
May Crude   -.69
June Gold   -21.70
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Corn planting advanced from 53% complete last week to now 71%. This was above analyst trade estimates of 67%. In addition, the current crop remains far above the five year average pace of 47%.

Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Corn planting advanced from 53% complete last week to now 71%. This was above analyst trade estimates of 67%. In addition, the current crop remains far above the five year average pace of 47%.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

 

Farmers' Planting Pace Well ahead of Average

May 08, 2012

 

Good Morning! Paul Georgy with early morning comments for May 8, 2012 at 5.15 am. Corn and soybeans futures are higher on strong cash and short covering. The outside markets are not providing any support as dollar is higher and crude oil is down 1.00. Planting progress for corn was 71% vs. 32% average and soybeans were 24% vs. 11% average. Emergence of corn was 32% while soybeans were 7% emerged. Spring wheat plantings were 84% complete compared to 19% last year. Winter wheat conditions were 1% to 63% good to excellent. Safras reduces Brazil soybean harvest to 66.82 million metric tons. Thursday at 7:30 am the USDA gives us May Supply and Demand. Trade estimates for corn ending stocks in old crop corn is 749 which would be a reduction of 56 million bushels from USDA’s last month estimate. Soybean ending stocks are expected to fall 36 million bushel from USDA’s previous estimate. There are very wide ranges in for the first estimate of new crop (2012-13) corn ending stocks 1.209 up to 2.072 and soybeans 87 up to 250 million bushel. The wide ranges give us the opinion that prices could be choppy through the report on Thursday. Cattle and hog futures recovered from lower opening giving the first sign the liquidation may be coming to an end. Boxed beef prices were mixed with choice up .19 and select down 1.43. Pork cutout values were down .41. Pork production in US on a weekly basis is running 4.9% higher than last year. China’s pork prices have fallen for 14 straight weeks due to a slowdown in consumption and oversupply. Follow us on twitter at Allendale_paul. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:15AM
Jly Corn    +7
Jly Beans   +4 3/4
Jly Wheat   +5 1/4
Jun Cattle -.12
Jun Hogs    -.30
Jun S&P     -7.25
Jun Dlr     +.14
May Crude   -1.06
June Gold   -11.60
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Monday’s inside range day at the bottom of the down trend implies that the Wheat markets negative price action could be slowing down. If the market breaks the 5/3/12 $5.99 1/2 low further weakness should not surprise. This markets attempt at recovery will be capped until the 3 consecutive closes at $6.55 1/2 are taken out.
 

Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Much of the North Central Corn Belt saw rains of 0.50 to 1.50 over the weekend. Other areas received less than 0.50 inch. The West will be dry through the remainder of the week. The East will see 0.40 to 1.00 inch today then dry for the rest of the week. Wet weather through this past weekend then dry conditions will be conducive to crop development. 
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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 Elections Create Stability Concerns

May 07, 2012

Good Morning! Paul Georgy with early morning comments for May 7, 2012 at 5.05 am. Corn and soybeans futures are lower. The macro markets are providing a risk off attitude for investors after Euro countries vote. The French election went to the Socialist party for the first time in 17 years and only the second time in history. In the Greek election, the ruling party lost seats which could cause problems making further austerity cuts there. Corn basis is strong with central IL with processors paying 60 over July on Friday. This afternoon planting progress should show an increasing of corn planted last week although rain kept many producers out of the field. Thursday’s supply and demand report will be the focus for the week. Analyst expectations are for a sizeable increase in ending stocks for 2012-13 for corn and a much tighter ending stocks in soybeans. Last week I traveled to the Allendale branch offices in Burlington IA and Pilot Grove MO. The corn crop looks like it is getting off to a great start and there should be a high percentage in the good to excellent in the conditions report. Livestock futures are likely to start the week as it closed out Friday. Boxed beef was lower on Friday with choice down .67 and select down .79. Pork cutout was higher by .76. The livestock markets are oversold with June hogs setting new contract lows on Friday. Follow us on twitter at Allendale_paul. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:05AM
Jly Corn    -4 1/2
Jly Beans   -8 3/4
Jly Wheat   -4
Jun Cattle Lwr
Jun Hogs    Lwr
Jun S&P     -7.75
Jun Dlr     +.20
May Crude   -.66
June Gold   -3.20
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Friday’s break of the 3/30/12 low of $5.23 exposes the Dec Corn contract to further losses. Trade above the 4/27/12 $5.45 high is needed to change this trend from down to neutral. A close below $5.23 could expose this market to sub $5.00 prices.

Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
The monthly employment report held disappointing news. 115,000 new jobs were created in April compared with expectations of 170,000. This was the lowest monthly gain since October.
Contact Allendale: 800-262-7538 research@allendale-inc.com www.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.

Narrow Trading Ranges for Grains Overnight

May 04, 2012

 

Good Morning! Paul Georgy with early morning comments for May 4, 2012 at 4:50 am. Corn and soybeans futures are higher. Macro markets continue to hand trader’s negative news which causes money flow to exit commodity investments. Weekly export sales were excellent with corn 3.47 mmt and soybeans 1.70 mmt. Watch for more sales to be announced at 8:00 am this morning. China has been a big buyer of new crop soybeans this week. CME delays the expansion of trading hours until May 21 due to filing issues at CFTC. The increase in margins for exchange members could impact the volatility as we go into the weekend. Watch for some evening up of positions before the margin requirement increase takes effect on Monday. World Weather Inc. says "the bottom line is the Midwest will see frequent rain through Monday and soil moisture should be favorable throughout the region. Planting delays will increase, but some fieldwork should continue around the rain. Shower activity will decline next week and planting should become more aggressive." Next week we will have to deal with the USDA supply and demand due to be released on Thursday morning. We will provide more research on what the USDA may say next week. Cattle futures rebound on Thursday to relieve the oversold condition in this market. A strong close today will be needed to convince traders a bottom has been set. Cash cattle traded on a few head in the south at 119 while product markets were mixed. Choice was down .22 and select was up .47 with pork cutouts down .35 on Thursday. Many traders are looking for the cookout season to provide better demand for meat. Follow us on twitter at Allendale_paul. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
 
Markets as of 4:50AM
Jly Corn    +1 3/4
Jly Beans   +5 3/4
Jly Wheat   +2 1/4
Jun Cattle +.25
Jun Hogs    +.05
Jun S&P     -1.75
Jun Dlr     +.05
May Crude   -1.22
June Gold   -4.70
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Today’s sharply lower trade in crude oil has established the May 1st high of $106.43 as the pivot high in this downtrend. Unless we see a close higher than this price level, further pricing pressure should be expected. 

Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Due to big sales to China and Unknown last week, the combined old and new crop corn sales were the largest single week export sales since 1991.
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.

 

Economic Data Provides Reason for Profit Taking

May 03, 2012

Good Morning! Paul Georgy with early morning comments for May 3, 2012 at 5:10 am. Corn and soybeans futures are mixed. Traders are dealing with weak HSBC PMI data out of China and negative Eurozone economic news. CME announced margin requirements changes for members which take effect on Monday, May 7. This could cause liquidation as member traders will have to adjust positions or meet the increases in margin ahead of the deadline. Weather forecast has not changed much from yesterday for the US. The dry areas in Ukraine and Russia should get some rain next week. Weekly export sales should be large for corn and beans. Reuters newswire trade estimates are: Wheat 600-850 tmt, Corn 3-4 mmt, Soybeans 1-1.5 mmt, Soymeal 200-400 tmt, Soyoil 5-15 tmt. We will be watching the 8:00 hour for new sales announcements to China. We were hearing feedlots were passing on offers at 120 yesterday. A few hundred head did trade in Kansas at 120 on Wednesday. It is assumed hedged cattle are being delivered to packers because of strong basis. Boxed beef was mixed yesterday. Choice was up .71 and select was down .03. Pork cutout values were up .69 and packers are cautious buyer when they see futures sliding. Sign up today for the Allendale Research Center on line or call 800-262-7538.
 
Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:10AM
Jly Corn    +1 3/4
Jly Beans   -2 1/4
Jly Wheat   +6
Jun Cattle -.52
Jun Hogs    +.30
Jun S&P     +1.75
Jun Dlr     +.13
May Crude   -.43
June Gold   -7.90
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
The hog market continues its downtrend after breaking the Tuesday low of $85.67. A push toward the 12/16/11 low of $82.63 looks to be in the cards. The downtrend is valid in the hog market until a recovery above the 4/26/12 high of $88.25
 
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
With Day 1 of the Kansas Wheat Tour complete, organizers suggest there is potential for record yields this year. Combined yield estimates point to a Day 1 total of 53.6 bushels per acre. That far exceeds last year's Day 1 estimate of 40.0 and even the record in 2005 of 48.9. Analysts estimate the total Kansas yield at 45.0.
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.

May Supply and Demand Expect to Move Markets

May 02, 2012

 

Good Morning! Paul Georgy with early morning comments for May 2, 2012 at 5:10 am. Corn and soybeans futures are lower as world traders return from holiday. The estimates for the May 10th USDA report from traders are stacking up to be one of the largest corn crops in several years and one of the tightest soybean ending stocks in nearly 2 decades. However, history suggests the May estimate is far from accurate in predicting the final numbers. The increase in bean acres will change the ending stock projections but acreage will not change until the June 30th report. Spreading will likely be a feature as weather forecast and money flow affect trader’s bias for several weeks. On Tuesday, funds sold 9,000 corn and 2,000 wheat and beans. Early indication from the Kansas wheat tour suggests very good yields compared to last year’s survey. China has bought over 8.0 mmt of new crop soybeans (a record for this early in the season) which indicates their concern about South American supplies. CME will expand trading hours starting Sunday, May 13. The Sunday session will start at 5:00 pm and run until 4:00 pm on Monday. And Monday through Friday sessions will start at 6:00 pm and run through 4:00 pm. Open Outcry will have the same hours. Packer margins are estimated to in the positive territory for the first time in months. That doesn’t mean they will have to be aggressive buying cattle due to the backlog of cattle on show lists. Boxed beef prices are acting toppy as choice is up .14 and select up .62. Warmer weather in metropolitan areas will help kick start the cookout season. Pork continues to struggle as cutout values were down .18. Stay in touch with Allendale Research by subscribing to the Allendale Research Center.
 
 
 
Markets as of 5:10AM
Jly Corn    -3
Jly Beans   -8
Jly Wheat   -6
Jun Cattle -.10
Jun Hogs    -.12
Jun S&P     -1.75
Jun Dlr     +.36
May Crude   -.41
June Gold   -7.60
 
Here are just a few of the reports we follow and record historical data on:
 
Allendale Advanced Charts
Spring wheat continues to hover above key support at 7.69 1/2. It is the low from the beginning of the year and if broken could trigger accelerate selling.
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
 
Nelson Notes from the desk of Rich Nelson
Monday afternoon USDA reported nationwide corn planting was 53% complete. This was far above expectations of 43% and above the five year average of 27%. The current rate is the second fastest in history.
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 Planting Eight Days ahead of Average

May 01, 2012

 

Good Morning! Paul Georgy with early morning comments for May 1, 2012 at 5:10 am. Corn and soybeans futures are lower as planting rate exceeds expectations. Producers were busy last week as planting progress for corn was 53% which was 10% more than trade was expecting. Soybean planting was 12% compared to the trade estimate of 13%. IL and IN were 79 and 70% respectively which is 50% above average. Next USDA supply and demand report on May 10 will include adjustments from March 30th planting intention and quarterly stocks data. The surprise could be in yield where the USDA used the 164 bushels per acre in Feb and in 6 of the past 14 years where plantings were ahead of average they raised yield. An average increase was 1.3% which would mean this year could be 166.2 bushels per acre. There also is a big question of how much of recent demand will be included in the May monthly export estimate. The Eurozone continues to enjoy a rainier pattern while even some of the drier regions in the Ukraine and Russia look to have better chances of rains next week. May Day Holiday in Europe and China will likely keep the macro markets quiet today. Japan is on holiday for the rest of week as they celebrate Golden Week. Significant show list carryover from last week could mean lower cash this week. Packer demand could offset weakness as production should pick-up due to an improvement in margins. Product is showing signs of topping after sharp rally in recent weeks. The cash cattle premium over June contract should provide support to futures. Product values were mixed. Choice was up .13 and select was down .11. Pork Cutout finally showed some strength being up 1.05 on Monday. 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
Jly Corn    -4 3/4
Jly Beans   -9 1/2
Jly Wheat   -8
Jun Cattle -.40
Jun Hogs    +.35
Jun S&P     -1.25
Jun Dlr     -.01
May Crude   -.29
June Gold   -3.30
 
Here are just a few of the reports we follow and record historical data on for our subscribers:
 
Allendale Advanced Charts
Wheat found strength today and created a double top with last Friday’s high at 6.55 ½. The long-term down trend remains in place until we get a close above 6.60.

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
In the next day and a half Southern Missouri and the Eastern Corn belt will see rains of 0.25 to 0.75 inch. On Wednesday the Northern third of the Midwest will see 0.30 to 0.80 inch rains. The third system will hit all areas over the weekend with 0.35 to 1.00 inch. This week will see ample rains and improved soil moisture. This will be considered beneficial for the crop. A slight drying pattern is seen next 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.

 

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