Sep 20, 2014
Home| Tools| Events| Blogs| Discussions| Sign UpLogin


August 2013 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.
 

Light Volume Ahead of Weekend

Aug 30, 2013

Good Morning! Paul Georgy with early morning comments for August 30, 2013 at 5:00 am.  Grain futures are lower in a light volume overnight session. Traders are evening positions ahead of the long weekend and after the recent rally. Traders will be getting ready for the potential fireworks on Monday evening.

Thanks to all who have helped with Allendale’s 24th Annual Yield Survey. Data collection closes at 3:00 PM central time. Allendale will release the results on Wednesday morning at 7:30 am.

The amount of rain coverage over the weekend and the forecast released on Monday will have a greater impact on markets than today’s forecast. Currently the Euro weather model has become wetter for the 1 to 5 day period which is more in line with the GFS model. The longer-term models have been very inconsistent which suggests Monday night trade could provide a sharp move in either direction.

Today is first notice day for delivery against the September futures contracts. There were no deliveries in corn and soybeans.

Export news: A Taiwanese purchasing group buys 60,000 tonnes of Brazilian corn. Argentina is expecting China to approve the final remaining genetically modified corn variety for import.

In the weekly export sales data, the US sold 868,000 tonnes of new crop soybeans. That brings the total sales of new crop soybeans for the 2013/14 marketing year to a record 724 million bushel or 52% of the USDA’s projected sales.

Cash basis at Midwest end-users were steady to lower with no farmer selling. Gulf basis was weak as southern corn producers harvest a record crop. Yield reports on early harvest are in the mid 200’s.

Cash cattle trade remains at a standstill. Beef cutout values were lower with choice down .57 and select down 1.20. The CME Feeder Index was set at 154.76 down .17. We looked at the discount of October hog futures to cash index compared to historical relationships and found that on a percentage basis, current levels are normal. Pork cutout values were down .36 on Thursday. More position evening is likely going into the long weekend.

Markets as of 5:00 AM

  • Dec Corn    -4                         
  • Nov Beans   -14 1/2
  • Dec Wheat   -1
  • Oct Cattle  -.02
  • Oct Hogs    -.05
  • Sep Dlr     +.02
  • Sep S&P     +3.25
  • Oct Crude   -.81
  • Oct Gold    -18.30

 

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Light Volume Ahead of Weekend

Old-New Crop Spreads Take Spotlight Again

Aug 29, 2013

Good Morning! Paul Georgy with early morning comments for August 29, 2013 at 5:00 am.  Grain futures are lower as commodity markets in general have a risk-off bias. The Dollar index is up sharply.

Weather maps and rain drop counting will be the concern of traders going into the weekend. The weather models are a little wetter with most of the light rain developing later this week. Many analysts are lowering their estimates for corn and soybean yields because of the persistent hot and dry conditions. Allendale’s Annual Yield Survey has only a few days left to get your farm’s yields. We will stop gathering data at 3:00 PM on Friday. We will release the results on Wednesday at 7:30 AM.

Weekly export sales data will be released at 7:30. Trade estimates are: for 2012/13 (old crop) corn -50 to +150 tmt and soybeans -100 to +150 tmt. For 2013/14 (new crop) corn 350 to 550 tmt, soybeans 600 to 900 tmt and wheat 350 to 550 tmt.

USDA weekly ethanol production was 820,000 barrels per day which was the same as a year ago. For the entire year total ethanol production equals 7.1% less than last year.

Corn harvest will start next week in Central IN. Yield prospects look good. Early corn harvest reports from MS and AR are 230 with some fields as high as 280 bu. per acre. Western KY is reporting 240 plus.

Old crop – New crop corn and bean spreads have become the feature in the grain futures markets going into the first notice day for the September contracts. Cash market premiums to the futures make it unlikely to see deliveries in corn. A Central IL processor is moving their bids based off of the Dec futures and not changing basis.

Chart watchers are looking at the 14.10 level in November soybeans as resistance. First level of support would be the gap left after Monday’s sharply higher opening. December corn contract has support at 4.75 and resistance at 5.08.

Outside markets are keeping a watchful eye Syria and what will the US do next. Crude Oil contracts are taking a breather at least for the moment. Speaker Boehner says the spending limit change will be in for a big fight.

Cattle traders are waiting for cash trade to develop this week. Bids in Southern Plains were limited at 121 to 122 compared to last week’s sales of 123. Beef cutout was mixed with choice up .19 and select down 1.24. Cash hogs were steady as packers fill needs going into the weekend. Pork cutout values were down 1.61 on Wednesday. Weekly egg sets were up 5% from last year and chick placements were up 1% compared to 2012.

Markets as of 5:00 AM

  • Dec Corn    -1 3/4                     
  • Nov Beans   -3 3/4
  • Dec Wheat   -1 1/2
  • Oct Cattle  +.07
  • Oct Hogs    -.17
  • Sep Dlr     +.41
  • Sep S&P     +2.25
  • Oct Crude   -.93
  • Oct Gold    -8.50

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Waffling Weather Worries Traders

Aug 28, 2013

Good Morning! Paul Georgy with early morning comments for August 27, 2013 at 5:00 am. Grain futures are higher as dry conditions stress crops.

Allendale’s 24th Annual Yield Survey has only 3 day left. Go to www.allendale-inc.com and fill out the short survey. "You know your fields better than anyone!"

Weather forecast from the GFS model turned a little wetter in the 5 day and much wetter in the 11 to 15 periods. Temps cool off early next week and in the 11 to 15 day period there now is talk of much cooler temps in northern Wisconsin. The Euro model is less convincing of rain potential. With the deteriorating yields, traders want to see the rain before giving up their position.

Farm Futures Magazine surveyed a group of farmers who said they will plant 3.4% less corn acres in 2014 and they intend to plant 2% more soybeans. That would make a record planting of soybean acres in 2014.

Tuesday soybean futures retested contract highs that were made on September 14, 2012. The 14.09 ¾ is now a critical resistance level in the November futures contracts. The gap left after Monday’s sharply higher opening will be support.

CONAB has lowered Brazil’s wheat production in its largest producing state by 700,000 tonnes due to the July frost. The weather forecast is for that area to have a chance of frost this morning as well. Brazil is not a big exporter of wheat but this could mean more business for the US.

CME has posted hours for Labor Day, grain markets will be closed Sunday night and Monday. They will open at 7:00 pm on Monday evening. Livestock will open on Tuesday morning at 9:05. First notice day is Friday for the September CME grain contracts.

Friday, August 30 is the last trading day for the August cattle contract. Trade is waiting for news of cash cattle sales this week as expectations are for steady to higher. With the short work week after Labor Day and the official end of cookout season, packers will try to play hard ball, however, tight cattle supplies should be supportive. Cutout values were higher with choice up .29 and select up 1.50. The CME Feeder Index was 155.00 down .59. Cash hogs are being supported by hot temps in the Midwest. Retailers have likely completed filling buying for the holiday. Pork cutout values were down .21 on 357 loads.

Thank you for a great turnout at the August Allendale Ag Leaders Webinar. Those who could not make last night’s live broadcast can log into the recorded session of an outstanding conversation with a USDA Meteorologist.

Markets as of 5:00 AM

  • Dec Corn    +2 1/4
  • Nov Beans  +2 3/4
  • Sep Wheat   +3 1/4
  • Oct Cattle     +.15
  • Oct Hogs       -.15
  • Sep Dlr         +.13
  • Sep S&P     +1.75
  • Oct Crude   +.78
  • Oct Gold    +5.50

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Dry And Hot, Say No More

Aug 27, 2013

Good Morning! Paul Georgy with early morning comments for August 27, 2013 at 4:45 am.  Grain futures are lower as they back and fill after yesterday’s sharp rally.

Allendale’s Ag Leaders Webinar for August will be held this evening. Our guest this month will be Brad Rippey, a USDA Meteorologist who is involved with the monthly USDA Supply and Demand Report lockup. 

Not much to say about market influencing factors this morning other than weather. Market participants are watching weather forecasts very closely. The Euro and GFS models are suggesting the ridging pattern may be backing out to the west allowing some moisture into the northern cornbelt. Amounts of rainfall would be around .25 to .50 inches and temps stay above normal for the 10 to 15 day period.

Crop conditions report yesterday afternoon showed corn at 59% G/E compared to 61% last week and 57% for the 5 year average. Soybeans were 58% G/E compared to 62% last week and 57% for 5 year average. As a comparison if you take out 2012 (because of extreme drought) and use the 5 previous years an average G/E would be 64% for corn and 62% for soybeans.

Funds were huge buyers on Monday. Estimates are that they were net buyers of 30,000 corn contracts, 23,000 soybean contracts and 7,000 wheat contracts.

Cash basis was mostly steady for corn except for a central IL processor who dropped corn basis by .50. Soybean basis was down .25 in old crop and down a few cents in new crop. Elevator operators did see a pick up new crop sales yesterday.

Boxed beef was lower on Monday with choice down .39 and select up .05. The CME Feeder Index was down .70 to 154.93. Feeder cattle futures have been under pressure because of fund liquidation and the rally in grain prices.

Cash hogs have been able to find support as packers fill immediate needs. Pork cutout values came under pressure on Monday as retailers have booked enough for the Labor Day holiday. Pork cutout values were down 1.35.

We ask that you take a walk through your field and give us your estimate of this year’s corn and soybean crops. There are only a few days remaining in Allendale’s 24th Annual Yield Survey. Call 800-262-7538 if you have any questions. Thanks for your help. "No one knows your field like you do."

 

Markets as of 4:45 AM

  • Dec Corn    -4 1/4
  • Nov Beans   - 3/4
  • Sep Wheat   -3 1/4
  • Oct Cattle  -.20
  • Oct Hogs    -.02
  • Sep Dlr     +.05
  • Sep S&P     -9.25
  • Oct Crude   +.81
  • Oct Gold   +19.00

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Ridging Pattern Drives Grains Higher

Aug 26, 2013

Good Morning! Paul Georgy with early morning comments for August 26, 2013 at 5:00 am.  Grain futures are higher as grain markets return to a weather market. Forecasts are for a high pressure ridge to build over the central US this week and keep any chance of rain to the north and temps could reach triple digits in some areas. It should be noted that weather models are increasing chances of rain for first half of next week with conflicting amounts. The Euro is a bit dryer than the GFS model.

Allendale Ag Leaders Webinar for August will be held on Tuesday night. Our guest this month will be Brad Rippey, a USDA Meteorologist.  We are in the second week of the 24th Annual Yield Survey, your survey result are very important. We will release our findings on Sept 4th at 7:30AM. Here is a sampling of results received during week one:

  USDA PF Tour PF Official Allendale
  Aug 12   Release Week 1
Indiana 166 167.36 163 173
Minnesota 166 181.1 163 159
North Dakota 116     109

 

Corn and soybean conditions are expected to drop 2 to 3% on this afternoon’s Crop Progress Report.

Corn basis continues to rise across the country as farmers are not willing to clean out the bins until they are sure drought or frost will keep them from getting a crop. Soybean basis is drifting lower with the rally in futures.

Last week’s crop tour reduced yield in corn to 154.1 compared to USDA’s 154.4 and reduced soybeans to 41.8 compared to USDA’s 42.6. In calculating total production they took off 1.8 million acres of harvested corn acres and 800,000 acres of soybeans because of prevent planting.

Managed money futures covered 31,443 contracts in corn to give them a net short position of 91.778. They were also net buyers in soybeans adding 52,811 contracts. Soymeal and soyoil also had funds adding to long positions. Wheat had little change.

The USDA surprised cattle traders with CoF numbers Friday. On feed 94% (est. 95.8), placed 90% (est. 98.6) and marketed 105% (est. 104.4). Placement numbers suggest very tight 4th quarter 2013 and 1st quarter fed cattle supplies. The cattle futures are expected to open higher off of that report. Boxed beef was mixed with choice up .35 and select down 1.19. The CME Feeder Index settled at 155.59 down .04. Pork cutout values were up .93 as retailers fills needs for the holiday.

Markets as of 5:00 AM

  • Dec Corn    +18 1/4
  • Nov Beans   +55
  • Sep Wheat   +10 3/4
  • Oct Cattle  Higher
  • Oct Hogs    Steady-Higher
  • Sep Dlr     +.05
  • Sep S&P     -1.50
  • Oct Crude   -.05
  • Oct Gold    +.50

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Grains Higher For Second Week

Aug 23, 2013

Good Morning! Paul Georgy with early morning comments for August 23, 2013 at 5:00 am.  Grain futures are higher on short covering after yesterday’s sharp decline. Corn and soybeans are higher for the second consecutive week.

Crop tour releases estimates on total corn and soybean production today at 1:30. On the final day of the tour they visited IA and MN where corn yields were higher than average. IA corn was estimated to have an average yield of 171.9 versus a three year average of 157.1. MN yield was pegged at 181 versus the 3 year average of 172.5. The USDA estimate for IA is 163 and MN is 166. Soybean pod counts were below the 3 year average.

Cash basis was firm for corn in most locations. Soybean basis was weak. The basis at the gulf was steady.

Funds were sellers of an estimated 14,000 contracts of corn, 5,000 soybeans and 3,000 wheat. First notice day for September contracts is next Friday.

The Farm Progress Show which runs from Tuesday through Thursday of next week has cancelled all field demonstrations due to lack of maturity of harvestable crops. Event planners say this is the first time in 60 years crops are unable to harvest.

Weekly export sales data was less than trade was expecting for new crop corn and soybeans. However the 2013/14 USDA soybean export projection is almost 50% sold which is well ahead of normal.

Beef in cold storage at the end of July was 464 million lbs. as reported by the USDA late yesterday. For the month, this represents a 17 million lb. drawdown. The only larger drawdown in the past 30 years for the month of July was in 2011 which had 18 million lb. withdrawal of stocks. There were a few cattle trading at 200 in the Nebraska yesterday. Boxed beef was higher, choice was up.38 and select was up .84. The CME Feeder Index was up .50 to 155.63.

Pork stocks almost always fall during July. USDA’s report showed a 20 million lb. drawdown to 545 million. The normal drawdown during July is 34 million. Pork cutout values closed out yesterday up .06 after being sharply lower at midday. October futures held horizontal support on the charts after breaking key moving averages.

Markets as of 5:00 AM

  • Dec Corn    +2 3/4
  • Nov Beans   +4 1/4
  • Sep Wheat   + 3/4
  • Oct Cattle  +.02
  • Oct Hogs    +.07
  • Sep Dlr     +.03
  • Sep S&P     -1.50
  • Oct Crude   +.20
  • Oct Gold    +4.20

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

How Much Corn Is Left On The Farm?

Aug 22, 2013

Good Morning! Paul Georgy with early morning comments for August 22, 2013 at 5:00 am.  Grain futures are lower as traders are booking some profits after the recent rallies in soybeans and corn.

Basis for corn is providing support for the nearby contracts as farmers holding grain are not willing sellers at current prices. Corn basis is reported at a $2.00 premium to September futures. Harvest is underway in the delta with some grain moving north. Central cornbelt harvest is a few weeks away. Soybean and meal basis continue to weaken.

The latest weather models were a little drier for the extended forecast with chances of rain across the upper Midwest now through Saturday.

More information from the crop tour puts Illinois corn yield at 170.5 bushels per acre compared to 3 year average of 148.04. The latest USDA projection for IL was 165 bushels per acre.  They should be releasing IA and MN later today. Watch for social media pictures and comments as the tour travels through these states to the final meeting place later today.

Ethanol data showed less production than last week at 844,000 barrels. This number was 3% less than last year however year-over-year production is down 7.3%. The USDA target is 7.2% decline in 2012/13.

Weekly export sales will be reported at 7:30 this morning. Trade estimates are old crop corn 25 to 125 tmt and new crop 700 to 850 tmt. The soybean estimate is old crop o to 100 tmt and new crop 1.300 to 1.700 mmt. The wheat estimate is 450 to 550 tmt.

Allendale’s 24th Annual Yield Survey is under way and we need your to help us with your farms corn and soybean yield expectation. You know your fields better than anyone. The survey can be filled out on line or call us at 800-262-7538.

Cattle on Feed report will be released on Friday at 2:00 pm. Trade is looking for feedlot supplies to drop 4.2%, placements to be down 1.4% and markets to be 4.4% higher than a year ago. Boxed beef was lower with choice down .14 and select down .38. The CME Feeder index is at 155.13 down .13.

Cash hog weakness on increasing supply weighs on futures. A holiday shortened week coming up has packers dropping bids. Futures broke key moving averages causing funds and speculators to become seller. Pork cutout values were down 2.26 as retailers have adequate supplies going into holiday.

Markets as of 5:00 AM

  • Dec Corn    -7 3/4
  • Nov Beans   -17
  • Sep Wheat   -5 1/4
  • Oct Cattle  -.20
  • Oct Hogs    -.62
  • Sep Dlr     +.45
  • Sep S&P     +6.50
  • Oct Crude   +.38
  • Oct Gold    -3.80

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Traders Take A Breather

Aug 21, 2013

Good Morning! Paul Georgy with early morning comments for August 21, 2013 at 5:00 am.  Grain futures are taking a breather after two volatile sessions.

Allendale’s 24th Annual Yield Survey is under way and we need you to help us with your farm’s corn and soybean yield expectations. You know your fields better than anyone. The survey can be filled out online or over the phone, call us at 800-262-7538.

Weather is a major factor over the next 2 weeks in determining the size of the 2013 corn and soybean crop. The short term forecasts have put a little rain in the northern cornbelt with a better chance late, next week. Temps are expected to be in the upper 80’s to low 90’s which will be helpful for maturation in some areas but stressful in the dry areas.

More crop tour results put Indiana corn yield at 167 versus three year tour average of 141 bushels per acre. Nebraska corn yield is estimated at 154.9 compared to three year average of 147.9 bushels per acre. Nebraska bean pod counts were below the 3 year average while Indiana beans had a pod count larger than the three year average. The tour estimate of total US production will be released on Friday at 1:30 PM. 

View a clip from this week’s broker strategy session in which Rich Nelson discusses how the information released by the FSA was misinterpreted by analysts last week.

Declining water levels on the Mississippi River may cause cuts in draft as early as this weekend. CIF basis is firming as grain demand at the gulf improves. Central Illinois bean basis was down 10 cent yesterday while corn was steady. Eastern Nebraska basis for corn was up 5 cents on light farmer movement.

Argentina ag officials say they will likely export 22 to 24 mmt tonnes while the USDA’s last estimate was 19.5 mmt. Jordan bought 100,000 tonnes of optional origin wheat which likely was Ukraine. Russia says they may cut back on exports in September due to the aggressive pace in July and August.

Cash cattle trade is at a standstill with no bids from processors. Showlists are smaller and packer margins are in the black which should improve chances of higher trade this week. Boxed beef was mixed with choice up .38 and select was down 1.33. Retail buying is almost completed for the Labor Day Holiday.

Discount of October hog futures to cash index is continuing to provide support to futures. Cash markets remain stable as packers fill chain needs this week and early next week. Processors hustle to fill retail orders for the last big holiday weekend. Pork cutout value was down .51.

Markets as of 5:00 AM

  • Dec Corn    +1
  • Nov Beans   +7 1/2
  • Sep Wheat   +3
  • Oct Cattle  +.20
  • Oct Hogs    -.10
  • Sep Dlr     +.13
  • Sep S&P     -4.50
  • Oct Crude   -.33
  • Oct Gold    -10.00

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

True Turnaround Tuesday

Aug 20, 2013

Good Morning! Paul Georgy with early morning comments for August 20, 2013 at 4:45 am.  Grain futures are lower on profit-taking after the sharp Monday rally.

The weather forecast is for most of the Midwestern states to experience net drying conditions for at least the next week to ten days. A majority of the area will continue to see favorable crop development, but the lack of rain combined with warm to hot temperatures will accelerate the drying rate for many areas and could lead to some production concern.

The weekly crop conditions report put corn at 61% Good/Excellent compared to 23% last year and 58% for the 10 year average. Corn in dough stage was 52% versus 65% average however dent was only 11% versus 30% average. The soybeans were 62% Good/Excellent compared to 31% last year and 58% for the 10 year average. Pod setting in soybeans was 72% versus 81% average.

News headlines will continue to be released today as the crop tour moves into IN and NE. Expect more pictures and comments on twitter and other social media. The tour sees the results of South Dakota corn yields at 161 versus the tour’s 3 year average of 120 and Ohio corn yield at 171 versus 144 bushels per acre for the tour’s 3 year average. Soybean pod counts are above a tour average for both Ohio and South Dakota.

Cash basis for soybeans declined after yesterday’s rally however corn remains firm.

Chart resistance in corn crosses at 4.90 and 5.00 with first level of support at 4.75 in December corn. Next resistance in soybeans is a long-term trendline, crossing at 13.12. September option expiration is Friday for CME grain contracts.

Tomorrow we will get the minutes of the FOMC meeting and data from Stats Canada.

Deferred contracts of live cattle futures are being supported by higher grain prices and providing support to the feeder cattle contracts. The CME Feeder Index was up 2.65 to 155.01 on Monday. Boxed beef was up .83 and the select was down .24. Packers are looking for a few hogs to finish out this week’s needs but larger supplies of market-ready hogs could keep prices steady. Pork cutout values were down 1.40.

Allendale Yield Survey results historically have been very close to the September USDA estimate only because of your help and your knowledge of your farms’ production. Thanks in advance.

Markets as of 4:45 AM

  • Dec Corn    -5 3/4
  • Nov Beans   -18 1/4
  • Sep Wheat   -4 1/2
  • Oct Cattle  +.15
  • Oct Hogs    =.02
  • Sep Dlr     -.22
  • Sep S&P     -2.50
  • Sep Crude   -.84
  • Oct Gold    -1.00

 

View the Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Dry Forecast Ignites Buying in Grains

Aug 19, 2013

Good Morning! Paul Georgy with early morning comments for August 19, 2013 at 5:00 am.  Grain futures are sharply higher on dry, warm forecast. Corn futures are testing last week’s highs while soybeans set new highs for the move.

Allendale starts its 24th Annual Yield Survey today. We will be collecting data for the next 2 weeks and will release the results on September 4th at 7:30 AM. We need your help in filling out the survey for your farm.

Weather forecasts are for dry conditions this week with better coverage next week. Traders are concerned if soybeans can hang on. Personal observation of soybean fields across northern IL on Sunday afternoon showed signs of stress with browning at the tops of some hills.

Processor basis for corn and soybeans remain firm as supplies are tight and farmers are reluctant to clean out their bins.

Technically, soybeans appear to be headed to retest the 13.00 level now that 12.75 has been broken.

ProFarmer will begin their crop tour today. Trade is expecting supportive news for markets as reporters will be traveling with the group. Social media will have pictures of ear size comparisons and field conditions. They will have the final results of the tour on Friday morning.

Managed Money funds increased short positions in corn by 10149 to -123,221. They added to long soybeans by 3,597 contracts and reduced their short position in soybeans by 3,339 to -43.996 contracts.  The funds also increased long positions in Live Cattle by 17,450 contracts last week.

Cattle finally traded late Friday afternoon with packers paying 123 in the south which was a full 2.00 higher than last week. Boxed beef was firmer with choice up 1.09 and select up .68. Cash hogs closed the week under pressure as hog supplies increase. The CME Feeder Index was up .08 to 152.36. Pork cutout was up 1.03. We expect some fill in demand early this week for the Labor Day holiday.

Markets as of 5:00 AM

  • Dec Corn    +9 1/4
  • Nov Beans   +17
  • Sep Wheat   +7 1/2
  • Oct Cattle  Steady=Higher
  • Oct Hogs    Steady-Higher
  • Sep Dlr     -.02
  • Sep S&P     +1.00
  • Sep Crude   -.34
  • Oct Gold    +5.00

 

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Market Rally An Opportunity To Make Sales?

Aug 16, 2013

Good Morning! Paul Georgy with early morning comments for August 16, 2013 at 5:00 am.  Grain futures are lower after a sharp rally in soybeans. After hitting technical resistance targets yesterday, traders are taking some profits ahead of the weekend.

Weather, exports, FSA data, technical buy stops and bears covering some of their holdings hit the markets all at one time on Thursday. Can those factors influence market attitude as balance sheets for corn are still burdensome? The soybean market has rallied $1.00 from the lows made on August 8 through yesterday. Corn is up nearly 30 cents from Tuesday’s low while wheat is up 17 cents from the lows made on Wednesday.

The weather forecast has less rain and warmer temps moving into the Midwest for the next week. It is likely to provide some stress on the growing crop. The greater concern is the chart put out by Accuweather which had an early frost on it. All traders are very sensitive to how the frost word is used this year. Brazil may be looking for more US wheat as a frost/freeze has impacted their wheat producing region.

NOPA crush was 116.3 million bushels which was less than trade estimate of 119. The crush for July was in line with what is needed to meet USDA balance sheet target. Soybean basis is down while corn basis is firmer at Midwest processors.

Rich Nelson, Allendale’s Chief Strategist, reminds us to not take the FSA data at face value. Just because FSA believes on their first draft that 3.4 million should come off their planted acreage number does not mean the USDA will do the same with their own planted acreage. The FSA reduced 2 million acres in 2010 on their first estimate and in the end the USDA number dropped only 300,000 acres. In 2011, FSA estimated 3 million and USDA lowered its corn acreage by 400,000 from July to January.

Cash cattle trade is at a stand-off. Boxed beef was higher on Thursday with choice up .95 and select up 1.01. Due to the strength in futures and product, traders are expecting cash to be higher than last week. Pork values were down .43. Retailers maybe doing some fill-in buying early next week which could provide more support to products.  CME Feeder Index is at 152.28 up .27.

Allendale’s Annual Yield Survey starts on Monday August 19th and runs through August 30th.

Markets as of 5:00 AM

  • Dec Corn    -5 3/4
  • Nov Beans   -7 1/4
  • Sep Wheat   -1 3/4
  • Oct Cattle  +.40
  • Oct Hogs    +.32
  • Sep Dlr     +.05
  • Sep S&P     +2.25
  • Sep Crude   +.40
  • Oct Gold    +4.80

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Late August Rains Needed For Soybeans

Aug 15, 2013

Good Morning! Paul Georgy with early morning comments for August 15, 2013 at 5:00 am.  Grain futures are higher due to lack of general rains across the Midwest. Short-covering on concerns of yield loss is providing strength to grains overnight.

Weather is a driver of soybeans as late August rains are very important to yield and overall production. The latest models are a little drier while temps remain on the cool side. Driving around our area in northern Illinois yesterday afternoon on a beautiful, low humidity day the soybeans were showing stress.  Corn, on the other hand, looks great.

Export sales data will be out at 7:30. Trade is estimating corn sales to be 200 to 450 tmt, soybeans 900 to 1,100 tmt and wheat 550 to 750 tmt. Old crop sales for corn and soybeans are expected to be minimal.

On Monday’s supply and demand table for soybeans, the USDA raised the crush number which suggests a NOPA number of 116.5 million bushels is needed to hit their target. Trade is estimating the NOPA crush data, which will be released at 11:00 CDT, to be 119 million bushel. By holding old crop ending stocks at 125, the USDA will have to pull some magic out of their hat on the next report.

Futures markets are oversold with technical resistance in Dec corn at 4.69 and support at 4.40. November soybeans would suggest that a close above 12.48 projects the next target of 12.75. This week’s low in November soybeans is considered major support. Seasonal trends suggest markets could work higher into early September.

Allendale’s Annual Yield Survey starts on Monday August 19th and runs through August 30th. We ask that you called us at 800-262-7538 or fill out the survey online. No one knows your fields like you do! Because of your help, Allendale’s surveys have been extremely accurate. The results will be released on September 4th.

Cash cattle trade is inactive through Wednesday. Last week cattle traded at 121 in the south and 123 to 123.50 in the north. With improvement in cutout values you would expect a stronger market this week. Boxed beef was higher with choice up 2.03 and select up 1.40. We expect retailers to be done buying for their Labor Day needs this week. CME Feeder Index is up .69 to 152.01.

October lean hog futures are being supported by the discount to the cash index. We suggest that cash hogs seasonally will have a sharp sell-off after the holiday buying is finished and futures are anticipating this price decline. Pork cutout values were down 1.17 on Wednesday.

Markets as of 5:00 AM

  • Dec Corn    +3 3/4
  • Nov Beans   +8 1/2
  • Sep Wheat   +1 1/2
  • Oct Cattle  +.07
  • Oct Hogs    +.15
  • Sep Dlr     -.22
  • Sep S&P     -3.00
  • Sep Crude   +.93
  • Oct Gold    +4.80

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Can Markets Rally On No Positive News?

Aug 14, 2013

Good Morning! Paul Georgy with early morning comments for August 14, 2013 at 5:00 am.  Grain futures are mostly lower this morning. Selling pressure continues based on a weak technical picture and lack of supportive fundamental news.

Weather forecast for next week is warmer which should help the maturation of the late planted crops. There also is more rain in the forecast for western cornbelt which has been the driest area.

Funds were a big seller yesterday. They are estimated to have sold a net 12,000 contracts of corn. This data will be included in Friday’s Commitment of traders report.

After discussion with USDA and understanding their yield calculation, trade is now thinking corn yield could be under estimated. They used a 5 year average ear weight which has been taken during several drought years.

Trade will be watching for export news for more new crop sales. China margins are providing an advantage to markets. Two of South Korea’s buying groups are tendering for optional origin corn.

Argentina soybean processors are striking today at the Rosario port area as they want better working conditions and a better health care plan. NOPA Crush data will be released on August 15 at 11:00 am CDT.

August futures contracts in soybeans, meal and soyoil will expire today.

Allendale’s Annual Yield Survey starts next Monday, August 19th and runs through August 30th. We ask that you call us at 800-262-7538 or fill out the survey online. No one knows your fields like you do! Because of your help Allendale’s surveys have been extremely accurate. The results will be released on September 4th.

The Pro Farmer crop tour starts next week. It will receive a lot of attention due to social media and reporters traveling with the tour. The headline traders will have a field day.

Beef cow slaughter is suggesting tighter meat supplies. From March through May, slaughter levels were 14% over last year. The Plains were still suffering from drought and cow/calf producers were saying "enough is enough". Since mid-June that pattern has changed. In the past four weeks, beef cow slaughter has been 9% under last year. Boxed beef was up .04 and select was up .45 on Tuesday.

Last year this minor "rebound into August" had a wholesale pork peak on the 6th. In 2011 it was made on the 8th. The industry now has to consider whether Friday August 9th was the peak. Pork cutout values were up .38.

Markets as of 5:00 AM

  • Dec Corn    +0
  • Nov Beans   -14
  • Sep Wheat   -2 1/4
  • Oct Cattle  +.30
  • Oct Hogs    +.40
  • Sep Dlr     +.08
  • Sep S&P     -2.25
  • Sep Crude   -.66
  • Oct Gold    +2.70

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Is USDA Data Close To Reality?

Aug 13, 2013

Good Morning! Paul Georgy with early morning comments for August 13, 2013 at 4:45 am.  Grain futures are higher on short covering and technical buying. Yesterday’s chart reversal has provided follow-through buying in the overnight session.

USDA surprises trade by decreasing corn yields by 2 bushels per acre instead of the 1 bushel increase expected by trade analysts. Yields will likely trend higher into the final number with crop condition ratings remaining at 64% good to excellent this week compared to 58% average. Historical data also suggests 6 out of 10 similar years had final yields that were higher than the August estimate.

The lower total corn production estimate gives the USDA some wiggle room on subsequent reports. They still have to deal with the prevented planted acres in IA and MN plus a possible reduction in harvested acres.

Soybean data released yesterday brings ending stock estimates to a snug level. The USDA lowered soybeans planted and harvested by 500,000 acres. Lowering the production by 75 million bushel now makes for a market even more sensitive to rainfall the last half of August and early September. An early frost could also have a major impact on soybeans yields. Soybean crop conditions were 64% G/E, steady with last week.

Wheat data had only minor changes to exports which lowered ending stocks by 25 million bushel. China’s import of wheat was raised by 1 million tonnes.

Chart watchers are looking at the big outside day up in December corn as supportive. However many are expecting Managed Money to be sellers on rallies as the 50 day moving average is still above the 5.00 area. The close above the 12.25 in November soybeans projects a retest of the 12.50 level.

The USDA increased beef production in the July through August period by 200 million pounds on Monday’s report. There were no new deliveries but 20 were retendered making all 160 deliveries retendered. Product markets were higher on Monday as retailers prepare for the Labor Day holiday. Choice was up 1.29 and select was up .85. Seasonal patterns suggest it is likely cattle futures have seen the summer lows.

Strong seasonal patterns suggest cash hog markets could trend lower after the retail buyer has filled their needs for the upcoming holiday. Pork cutout values were down 1.57 on Monday.

Allendale’s Annual Yield survey begins on Sunday we look forward to the estimates from your farms.

Weekly Poll Results: What percent of new crop corn do you have sold?

0-25%—–>58.88%
26-50%—–>20.56%
51-75%—–>9.35%
76-100%—–>11.21%
Thank you for participating!

 

Markets as of 4:45 AM

  • Dec Corn    +3 1/2
  • Nov Beans   +14
  • Sep Wheat   +5 1/4
  • Oct Cattle  +1.10
  • Oct Hogs    +.02
  • Sep Dlr     +.16
  • Sep S&P     +5.75
  • Sep Crude   +.90
  • Oct Gold    -.60

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Markets Waiting For Today's USDA Report

Aug 12, 2013

Good Morning! Paul Georgy with early morning comments for August 12, 2013 at 5:00 am.  Grain futures are mixed in a quiet session ahead of the USDA Report. The US Dollar is stronger and stock indices are suggesting a lower opening.

Traders are waiting for the USDA Crop Production report at 11:00 am. It is expected that corn yields and total production will increase with the likelihood to see increases on subsequent reports. Soybean numbers are expected to create some excitement as yield and acres could be adjusted to impact total production. Weather over the next several weeks will have a huge impact on soybean yields.

The weekend rains were about as expected. The 6 to 10 day forecast is a little drier than last week but the models are not in agreement. Temps are expected to remain cool.

Basis on corn has held steady as farmer selling is limited. Soybean basis works lower as meal demand wanes.

Taiwan announced late on Friday that MFIG bought 60,000 tonnes of corn from Brazil for late Oct delivery.

CFTC Commitment of Traders report showed Managed Money Funds increasing their short positions in corn and wheat. They reduced long positions in soybeans by 31,910 contracts to leave them net long 43,580 contracts.

There were another 20 contracts of cattle delivered against the August Live Cattle futures though July 19, 2013. Total deliveries have been 160 with 140 retenders. Beef cutout values were slightly higher on Friday with choice up .68 and select was down .05. CME Feeder Index was up .50 to 150.24. Cash hogs are expected to start the week under pressure. Pork cutout values closed the week on a firm note being up 1.13.

Tune into Rich Nelson shortly after 12:00 for a review the USDA Report. It will be available on our home page at www.allendale-inc.com.  

 

Markets as of 5:00 AM

  • Dec #Corn    +1
  • Nov #Beans   +8 1/2
  • Sep #Wheat   -1 3/4
  • Oct #Cattle  steady
  • Oct #Hogs    steady
  • Sep Dlr     +.29
  • Sep S&P     -9.25
  • Sep Crude   +.30
  • Oct Gold    +14.60

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Will Traders Cover Shorts Before Weekend?

Aug 09, 2013

Good Morning! Paul Georgy with early morning comments for August 9, 2013 at 5:00 am.  Grain futures are mixed in a quiet overnight session. New news affecting grain markets is limited until we get to Monday’s USDA Crop Production Report.

Trade average estimates suggest they are expecting an increase in US corn production due to an improvement in yield. Allendale’s research suggests it is unlikely there will be any changes in planted acres but don’t be surprised to have an adjustment in harvested acres.

Soybean data adjustments are very possible on Monday’s report. The USDA did a re-survey in late July for planted acres. Soybean yields could be adjusted as well due to late planting and weather variance across the Midwest.

Cash grain markets are firm in the country for both corn and soybeans which is driving strength in the front month contracts at the CBOT. Farmers are taking a tough stand due to the recent market sell-off and not selling cash product. Most bins are already empty.

Export data showed China as a big buyer of soybeans. USDA confirmed more old crop sales of soybeans which continue to add to the problems for meeting the 2012/13 ending stocks balance sheet. Corn and wheat sales were in line with trade expectations however favorable weather continues to limit gains.

Tyson’s ban on buying cattle that have been fed Zilmax may not have as much of an impact on cattle production as first thought. Cattle feeders will find an alternative to Zilmax which will comply with their packer’s requirements. The Closing Cattle commentary in the Allendale Advisory Report has more discussion on the subject. Two closes above 127.00 in the October contract are needed to confirm a summer low has been made. Choice beef was down .35 and Select was up .38. The CME Feeder index was steady at 149.74. The pork rally continues in sympathy with the strength in cattle. Pork cutout values were down .64.

If you would like a free copy of the Allendale Advisory Report sign up on line or email us at service@allendale-inc.com and we will see you get the information you need going into the August Report on Monday.

Markets as of 5:00 AM

  • Dec Corn    -2
  • Nov Beans   +7 1/4
  • Sep Wheat   +2
  • Oct Cattle  -.10
  • Oct Hogs    -.42
  • Sep Dlr     -.12
  • Sep S&P     -5.50
  • Sep Crude   +1.18
  • Oct Gold    -.60

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

State By State Production Analysis

Aug 08, 2013

Good Morning! Paul Georgy with early morning comments for August 8, 2013 at 5:00 am.  Grain futures are higher on short-covering ahead of the USDA report on Monday.

Click here for a detailed State by State Breakdown on corn production and their impact on the bottom line to total production. Rich Nelson shares data on how Allendale comes up with the estimate of 156.2 yields.

This morning, at 7:30, the USDA gives us the weekly export sales data. Estimates for old crop corn are 0 to 200 tmt, new crop is 450 to 700 tmt. Old crop Soybean estimates are 0 to 100 tmt and new crop is 700 tmt to 1.00 mmt. The wheat sales estimate is 500 to 700 tmt.

The Goldman roll started yesterday and caused pressure on the Sept contract compared to the deferred months. Basis for nearby cash markets continues to strengthen as tight pipeline supplies will be a focus for end-users as they wait for harvest to begin. The Goldman roll is expected to continue through the 13th.

The EIA ethanol production data was higher than last week and 4% higher than last year. This data now puts the yearly ethanol production very close to the USDA 2012/13 goal of a 7.2% year over year.

Weather continues to be favorable for US crops but traders are beginning to be very worried about the maturity progress. Producers from all across the cornbelt are sharing their stories about what an early frost would do to their production. Spring wheat producers are running about 2 weeks behind in harvest with some now worried about quality problems. The 2013 weather market is now beginning phase III.

Tyson announced that they are going stop accepting cattle that have been fed the Zilmax additive. The news pushed prices into stops above the market. Boxed beef was higher on Wednesday afternoon; choice was up 1.49 and select was up .77. There were no new cattle deliveries however there were 60 loads re-tendered. The CME Feeder Index was down .05 to 149.74. Hog futures recovered some of Wednesday’s losses on the Tyson news. Pork cutout values were down .34.

If you would like a free copy of the Allendale Advisory Report sign up online or email us at service@allendale-inc.com and we will see that you get the information you need going into the August Report on Monday.

Markets as of 5:00 AM

  • Dec Corn    +4
  • Nov Beans   +11 1/4
  • Sep Wheat   +2 1/4
  • Oct Cattle  +2.72
  • Oct Hogs    +.60
  • Sep Dlr     -.14
  • Sep S&P     +3.00
  • Sep Crude   -.19
  • Aug Gold    +4.10

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Can The Market Rally On Bearish News?

Aug 07, 2013

Good Morning! Paul Georgy with early morning comments for August 7, 2013 at 5:00 am.  Grain futures are mixed in a very quiet overnight session.

An observation: the futures market is being inundated with bearish news. It is starting to feel like we could be in for a bounce simply because everyone is in the same camp and it is so obvious to be selling. The technical indicators are showing oversold. A suggestion to those piling on the short side at these levels, make sure to use risk protection.

Basis for cash corn has jumped at ethanol plants in some locations. Movement of grain by farmers has been limited due to the price break that has occurred over the past few weeks. Processors in the central cornbelt have raised bean bids but are seeing very little selling. Meal basis continues to weaken which is deteriorating crush margins.

Traders are expecting an increase in corn and a reduction in soybean production on Monday’s report. Newswire survey of analysts have average corn yield at 157.72 compared to the 156.5 USDA estimated in July. Total production for corn average is 13.980 billion bushels compared to 13.950 billion in July. Soybean estimates put yields at 43.57 bushels per acre and total production at 3.338 billion bushels. This compares to USDA’s July numbers of 44.4 bushels per acre and 3.420 billion bushels total production.

Many are looking for China to come in and be a buyer of US corn because of the decline in price. A comparison of US to Brazil corn gives advantage by $30 to $35 to Brazilian sales. Listen in to the "Morning Coffee" around 7:30AM central time to get more details.

Boxed beef was higher on Tuesday with choice up .71 and select up .36. The CME Feeder Index was up .20 to 149.79. August futures finally surpassed the Lean Hog Index yesterday. The discount of October futures to cash is providing buyers with incentive as the August nears expiration. Fundamental traders are preparing for aggressive hog movement in a few weeks. Pork cutout values were up .79 on the close Tuesday.

If you would like a free copy of the Allendale Advisory Report sign up online or email us at research@allendale-inc.com and we will see that you get the information you need going into the August Report on Monday.

Markets as of 5:00 AM

  • Dec Corn    + 1/4
  • Nov Beans   -2 1/4
  • Sep Wheat   -2
  • Aug Cattle  +.57
  • Aug Hogs    +.40
  • Sep Dlr     +.07
  • Sep S&P     -7.75
  • Sep Crude   +.10
  • Aug Gold    9.20

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Will USDA Change Planted Corn Acres?

Aug 06, 2013

Good Morning! Paul Georgy with early morning comments for August 6, 2013 at 4:45 am.  Grain futures are lower due lack of supportive news. The corn and soybean crop conditions report can out a little better than what trade was expecting at 64% G/E which was up 1% from last week. The 10 year average is 60% G/E. However, the corn in dough stage is only 18% versus normal of 31%. Traders are talking more and more about cooler temps now increasing the frost risks.

Goldman roll, due to start tomorrow, is putting pressure on the old crop/new crop spreads as they are expected to be selling September contracts and buying the deferred. Spreads are also getting hammered because of the announcement by a major ethanol producer that they are temporarily shutting down 9 ethanol plants from late August through September. Maintenance and tight corn supplies were cited as the reasons for their decision. This has caused pressure on the September contract and on corn basis.

China plans on selling 500,000 tonnes of soybeans out of their reserves however the price maybe 15 to 20% higher than Brazilian imported soybeans. US exports of corn and wheat are being bypassed because of the cheap Black Sea values. Brazil is very competitive as it has cleaned up its port delays.

Next Monday is the August USDA S+D report and many traders are expecting acreage changes on corn planted acreage and yield. Rich Nelson reviewed the statistics and found that it is unlikely that USDA change the planted acres on the August report. It is more likely the USDA will change harvested acres and/or yield. The soybeans could see changes due to the re-survey of planted acres in late July. More details are available on the Allendale Advisory Report.

There were 50 deliveries of live cattle against the August futures contract partially through April 4, 2013.  The cattle were delivered in the south where cash markets are at the largest discount to futures. Boxed beef was lower on Monday with choice down .75 and select down .36. CME Feeder Cattle Index was 149.59 up .10. The pork complex remains strong as buyers are looking at the discount of October to August as it approaches last trading day on the 14th. Pork cutout values were .54 higher on Monday. Visit www.allendale-inc.com around 7:30 to watch the "Morning Coffee" for more insight.

Yesterday’s Poll Results: What change will the USDA make to yield on the August 12th Report?

Raise 3 to 5 bpa (159.7 to 161.6) 13.22%
Raise 0 to 3 bpa (156.7 to 159.6) 41.95%
Unchanged (156.6) 26.44%
Lower 0 to 3 bpa (156.5 to 153.6) 12.64%
Lower 3 to 5 bpa (153.5 to 151.6) 5.75%

 

Markets as of 4:45 AM

  • Dec #Corn    -1 3/4
  • Nov #Beans   -4 1/2
  • Sep #Wheat   -1
  • Aug #Cattle  +.02
  • Aug #Hogs    +.05
  • Sep Dlr     -.13
  • Sep S&P     -.25
  • Sep Crude   +.39
  • Aug Gold    9.80

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Can Markets Bounce Ahead Of USDA Report?

Aug 05, 2013

Good Morning! Paul Georgy with early morning comments for August 5, 2013 at 5:00 am.  Grain futures are lower as bullish news is hard to find. Liquidation of the old crop/new crop spreads dominate the overnight session. The forecast is for crops to have a stress-free week. Many producers in the Dakotas are getting concerned about the below normal temps and the maturation process. Crop conditions this afternoon are expected to be steady or better than last week.

The CFTC Commitment of Traders Report on Friday showed non-commercial and non-reportable traders posted a combined record short position of 185,568 contracts. Managed Money Funds are now short 108,089 corn and 40,804 wheat. They reduced long soybeans by 34,152 to leave them net long 75,490 contracts.

The August USDA Reports will be out next Monday. It appears trade is starting to raise old crop ending stocks expectations. The Goldman Roll will start on Wednesday which means they will be moving long positions out of the September contract.

Cash cattle trade ended the week with light volume. It is likely the showlist number will increase however packers may be looking for a few more cattle. Boxed beef was mixed again on Friday with choice up .55 and select down .63. Futures have consolidated waiting for some positive news from either the cash market or the product. The Feeder Index is 149.49, up .48.

Cash hogs could start the week steady to lower as 3 plants will be dark today due to a rolling holiday. Pork cutout values were up 1.50 on Friday. The August futures will go off the board on August 14th. Currently, it is at a discount to the CME Lean Hog Index. For more details watch the Morning Coffee video around 8AM on www.allendale-inc.com.

Weekly Poll Question:What change will the USDA make to yield on the August 12th Report? Take the poll here

Markets as of 5:00 AM

  • Dec Corn    -1 3/4
  • Nov Beans   – 1/4
  • Sep Wheat   + 1/4
  • Aug Cattle  Steady
  • Aug Hogs    Steady
  • Sep Dlr     -.11
  • Sep S&P     -.50
  • Sep Crude   -.57
  • Aug Gold    -.50

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Processors Raise Bids To Fill Immediate Needs

Aug 02, 2013

Good Morning! Paul Georgy with early morning comments for August 2, 2013 at 5:00 am.  Grain futures are higher on short covering overnight.

Cool weather has had a cooling effect on the grain futures in recent weeks. The rainfall data is coming in for July showing most areas of the Midwest was well below average. However when trying to determine the impact on corn production there were 75 years of below average rainfall with only a few years of cool temperatures. This will add to the difficulty of determining crop size. The timely rains mixed with cool temps have certainly improved the appearance of the crop.

The August USDA crop production and S+D report will be released on Monday the 12th at 11:00 am. Several firms are releasing their estimates. FC Stone released their numbers yesterday. They project corn yields at 157 and a total production of 13.993 billion bushel. Soybean yields were estimated at 43 bushel per acre and total production at 3.309. Informa will put out their numbers next week.

The cash trade in corn and soybeans is becoming a real "cat and mouse" game. Processors that need grain are raising bids until they make the purchases they need then back off bids quickly. Producers with old crop to move before harvest are rolling the dice as they will have to move their inventory before their neighbors and before the processors are convinced they don’t need any more grain until the new crop arrives. We hear some central cornbelt elevators are creating incentives for farmers to harvest corn at high moisture. Trade is talking of rail rates for a poultry producers being negotiated for corn coming into the gulf. Soybean and meal basis is steady.

Export sales were excellent last week as lower prices have created buying interest. Old crop soybeans sales were 78,000 tonnes which continue to pile on the ending stock problem the USDA will have to deal with on the upcoming reports. Crush margins are positive even while some plants are closed for maintenance. Where will the USDA find the soybeans?

Chart damage this week is leaving the bulls bruised going into today’s close. The markets are oversold which could lead to a short covering rally however a rally is likely to be met with selling until funds and fundamental traders find a reason to buy.

Cash cattle traded in Kansas at $119 which was steady with last week. Boxed beef was mixed at the close of business Thursday with choice up $.34 and select down $.12. Futures contracts are trading at a premium going into first notice day for the August cattle contract on Monday. The October closed below last week’s low which could make it technically vulnerable going into the weekend. Thursday afternoon pork cutout values were up $1.39. Lean Hog October futures have bounced off of July lows on short covering.

Markets as of 5:00 AM

  • Dec Corn    + 1/2
  • Nov Beans   +5 1/4
  • Sep Wheat   +3 1/4
  • Aug Cattle  -.20
  • Aug Hogs    +.20
  • Sep Dlr     +.06
  • Sep S&P     +.25
  • Sep Crude   -.13
  • Aug Gold    -23.50

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Can Tight Supplies Drive Price Potential?

Aug 01, 2013

Good Morning! Paul Georgy with early morning comments for August 1, 2013 at 5:15 am. Grain futures are steady to lower. Corn futures are starting lower as weather conditions weigh on market sentiment. Weather continues to be spun as bearish with cool temps hanging around and several systems to move across the cornbelt by the weekend. There are still some dry areas but the cooler temps are helping them hang on until some rain arrives. Because of the weather change, many analysts are raising the yield forecasts for corn and soybeans. Some are already trying to talk up an early frost. We are probably about 2 weeks away from traders having confidence in a long-term forecast.

Old crop supply and demand is a unique situation. Processors and ethanol plants in IA raised cash bids as much as 45 cents per bushel and NE climbed 35 cents for corn in the past few days. However, bids remain well below last week’s highs. Some soybean processors are shutting down for seasonal maintenance and have dropped bean basis by as much as 50 cents. With the positive profit margins, ethanol production for the week ending July 26 was 832 thousand barrels per day. This is a decline of 2.46% from last week and up 2.84% from last year. The improvement in corn basis has not enticed much farmer selling of corn this week. Many will be waiting to see how the USDA handles the ending stocks on the August 12 report.

Weekly export sales data will be released at 7:30 this morning. Trade estimates are for:

                         2012/13                    2013/14     
Corn            -50,000-180,000     450,000-700,000     
Soybeans    -100,000-125,000     500,000-700,000     
Soymeal        50,000-150,000       75,000-200,000     
Soyoil               zero-30,000                   zero 
Wheat               ************         500,000-700,000  

 

Overall commodity markets received a boost overnight from the better than expected Chinese PMI of 50.3 when trade was expecting 49.9. At 7:30 this morning we should be getting comments from the European Central Bank. Tomorrow the unemployment data will be released.

The cattle market is caught in a trading range with October futures trading between 125 and 127. Cash markets are waiting for the packer or feedlot to give in. There have been a few bids showing up at 117 with feedlots asking 121 to 123. Boxed beef ended the month on a weak note. Choice was down .46 and select was down .01. The CME Feeder Index was up .21 to 148.52. Pork cutout values were down .08 on Wednesday. Cash hogs are providing support to futures due to the August contract’s discount. Allendale representatives will be happy to answer any questions you may have about the markets, visit or call one of our offices in your area.

Markets as of 5:15 AM

  • Dec #Corn    -3 1/2
  • Nov #Beans   + 1/4
  • Sep #Wheat   + 1/2
  • Aug #Cattle  -.07
  • Aug #Hogs    +.17
  • Sep Dlr     +.59
  • Sep S&P     +12.50
  • Sep Crude   +1.14
  • Aug Gold    +10.80

 

View Today’s Chart of the Day

If you have any questions on any of our material, give us a call at 800-262-7538 or email us at service@allendale-inc.com

Log In or Sign Up to comment

COMMENTS

Receive the latest news, information and commentary customized for you. Sign up to receive Dairy Today's eUpdate today!

 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions