CORN
Crop condition ratings declined more than expected to 31% Good to Excellent. Many analysts are talking about yields in the 130-135 area and some are lower than that. At the moment, there is no relief in the forecasts, so another decline should be expected next week and possibly the following week as well. The December corn closed above $7.50 yesterday and the next objective is $8.00 according to analysts.
WHEAT
The wheat keeps following the corn higher as it should. Crop losses in the corn are becoming large enough that USDA is underestimating wheat feed usage by a great deal. Stocks could end up being much tighter than what USDA indicates and we are going to be in need of a good crop next year. Analysts say that at some point, we may see new crop futures trying to attract acres.
SOYBEANS
The soybean ratings fell 6 points to 34% Good to Excellent. At this point, we can probably forget a yield in the 40's. The market is going to be very sensitive to any fresh demand because we really can't handle it. Buying breaks if we get them and July '13 beans look cheap at this level, say analysts.
LIVE CATTLE
Live Cattle futures started the week softer, with near triple digit losses posted in the front months. Weakness in feeders, along with technical selling weighed on the fats. Cattlemen are fighting negative closeouts along with heat and dust in many yards. analysts believe that we appear to be a week or two away from much of a turn around. Exports and lighter closeout weights are expected to support the market over the coming months.
FEEDER CATTLE
Feeder Cattle futures continued their plummet on Monday, posting limit losses across the board. Strength in corn continues to be the driving factor, along with feedlot losses reaching painful levels. Corn prices are modestly higher this morning, with feeders off of their limit losses of last evening. Corn conditions released on Monday did little to offer support for the feeders, with good to excellent ratings dropping another 9% nationally.
CRUDE OIL
September crude oil prices were higher during the overnight and early morning hours, supported by a bounce in global equity markets and measure of weakness in the US dollar. It appears that the macroeconomic tone has turned hopeful ahead of Fed Chairman Bernanke's testimony in front of the US Senate Banking Committee this morning, as well as the chance that he might hint at more quantitative easing. This comes after another dismal US Retail Sales reading yesterday and reduced IMF global growth forecasts. This, along with tensions over Iran's nuclear program and the US Navy firing at a fishing boat off the UAE offer the crude oil market early support.
There is substantial risk of loss to futures and options trading. Past performance is not indicative of future results.
By Donna Hughes
Lone Star Portfolio Advisors, Inc. was founded by Donna Hughes. Donna began her career in the industry in 1978 after graduating High School as a member of the Chicago Mercantile Exchange’s Inspection and Delivery Department where she was responsible for scheduling and facilitating the USDA grading and delivery for various Exchange Commodities. After 1 ½ years, she was offered a position working with George Segal, a prominent hedger in the Pork Belly market. It was through this relationship that she was mentored and taught the hedging process by working with Mr. Segal as well as other leaders of the Pork Industry. In 2004, Donna moved to Texas where her skills in the industry were utilized to help individual and corporate producers with their Risk Management Goals. Her Daily Market Commentaries are heard on the AllAgNews.com Radio Network broadcasting throughout Texas. She also contributes to magazines and periodicals including PetroEvents and Ag Monthly.
Donna created Lone Star and implemented strategic relationships with Daniels Trading and R.J. O’Brien leveraging their services to enable Lone Star to Build Lasting Relationships Thru Information, Execution and Research.
