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Corn comfortably above $8

07/30/2012 @ 6:18am

To end the week, there were not many changes in weather but many different opinions on yield prospects. During the day, Friday, we saw one estimate of corn yield at 122, another one at 134, and a third estimate (looking only at Iowa corn) suggesting 117 for that state. It appears we had a Friday full of opinions which offered some more volatile trading than we have seen recently. Weather still suggests a chance for .25 to .75” of rain across the heart of the Midwest Sunday/Monday with another chance late next week across more of the northern areas. This was not much of a weather change today. Outside markets were volatile with news as well, most of which turned out bullish for corn. Last Friday this market ended strong which lead Sunday night trade to hit 800 but not break it. We would have no problems believing that Sunday night could slightly break 800. It is still tough to believe there are many eager buyers of corn given the recent demand slow down. Right now the question is if demand is slowing faster than weather is hurting supply. We look for fireworks again on Sunday night but do not believe a higher move will result in instant heavy buying…Ryan Ettner


Less Than Expected Iowa: Friday’s chart shows varying opinions on Iowa’s production. The state which was supposed to help carry the drought areas is now coming in less than expected when crop tours get in the fields…Rich Nelson

 

Working trades:

(7/16) Sold December corn $10.00 call 10, risk 30, objective 0.


We have what looks like a good “tight” supply of cash hogs right now. Packers are trying to secure numbers for later next week and are still being a little aggressive. Friday’s chart shows we have one more week of tightness left here. By the dnd of August, hog supplies will be on the rise. The big jump in supplies really hits home in October. Our net message here is not to get bullish on this “last chance” summer rally. Keep in mind hog prices are determined by the supply and the demand for hogs at a certain time period. We are entering the tough time of year for pricing from here on out. Producers should finish up sales over the next few days. Speculators should shift to a bearish opinion around the first week of August (using October and December futures)…Rich Nelson

 

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