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The Allendale Wake-Up Call

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.

Profit Taking in Soybeans

Nov 25, 2013

Good Morning! Paul Georgy with early morning comments for November 25, 2013 at 5:00 am.  Grain futures are mixed as traders begin adjusting positions for the holiday shortened week.

Traders will be watching the newswires at 8:00 AM when the USDA announces export sales. The jump in soybean prices last week has circulated talk that China was buying large amounts of US meal and that Brazil is halting soybean sales until February until they figure out their supply situation. Some traders believe that the rally on Friday was driven solely by technical factors. Technical resistance crosses today in January soybeans at 13.22.

Farmers were notable sellers of soybeans on Friday and processor basis weakened. Corn sales are light as farmers finish harvest and prices struggle to rally.

Weather conditions in South America are still viewed as favorable to growing crops.

The Iran deal over the weekend is being spun as potentially friendly to demand for wheat and meal, however it doesn’t mean they will buy from the US.

Friday is first notice day for the December CBOT contracts. Trade is expecting large meal deliveries, no meal and zero to 1000 corn and wheat.

Managed funds increased short corn positions by 7,000 contracts to be net short 146,086 contracts. They added 8,500 contracts to their long position in soybeans and added 8,000 contracts to increase their short positions in wheat.

Israel tenders for 100,000 tonnes of optional origin corn and South Korea is tendering for 39,600 tonnes of optional origin milling wheat.

The Cattle on Feed report might be considered a little bearish as placements were higher than trade was expected. Total cattle on feed and marketing’s were on trade estimates. The sharp break in cattle futures last week may give way to some buying as markets are technically oversold and the report is out of the way. Beef cutout values were higher with choice up .34 and select up .39. The CME Feeder Index is 164.85 up .03.

Pork traders will be dealing with the short work week ahead and the hopes that the largest supply of market hogs are behind them. December futures currently are carrying a $3.00 premium to the cash hog index. Pork cutout values were down .34 on Friday. Expect volatility this week as some traders start their Thanksgiving holiday early.  

Markets as of 5:00 AM

  • Dec Corn    + 1/2
  • Jan Beans   -4 1/4
  • Dec Wheat   +3 1/2
  • Dec Cattle  Steady-Lower
  • Dec Hogs    Steady-Lower
  • Dec Dlr     +.22
  • Dec S&P     +5.50
  • Jan Crude   -1.35
  • Dec Gold    -13.00
Chart of the Day

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