Monday, July 30, 2012

Country Hedging's Mid Day in the Markets 7-30-12

Midday In The Markets

Grains are trading higher on a hot and dry weekend and forecasts are showing that trend will continue this week.  Moisture for soybeans will become ever more important these next few weeks while corn is beyond benefiting from rainfall.  The trade is expecting another drop in crop conditions in this afternoon’s USDA report.  December corn hit a contract high this morning of $8.17 ¼ and is currently up 20c to 8.13.  Wheat has been following corn higher while also being supported by news of global supply issues and Russia looking at suspending grain exports due to low production.  Soybeans are also stronger with the front and deferred months trading about 30c higher.  Corn and wheat export inspections topped expectations with corn at 21.44 million bushels and wheat inspections at 18.6mb.  Soybean inspections were in line with expectations at 15.5mb.

A USDA meteorologist reported that 75% of all cattle herds in the US are located in areas that are experiencing drought.  Live cattle futures are trading much higher than cash prices as beef demand has slowed down and signs of tightening supplies.  Currently nearby live cattle are trading up  .575 to 120.175.  Feeder cattle are trading mixed with another surge in corn prices.  August feeder cattle are .850 higher at 138.600.  Lean hogs are trading mixed today with a rally in corn prices leading deferred months higher and lower pork cutout values that were released after the close on Friday are initiating selling in the August contract. 

US stock markets are paying attention to today’s meeting of the ECB’s President, Germany’s finance minister, and the US Treasury Secretary.  They are expected to release a statement at the conclusion of the meeting providing insight into how they plan on turning around the declining global economy.  Spain announced today that its economy has contracted for the third straight quarter.  Crude oil has been hovering around $90 today, but is currently down 44c to 89.69.  The Dow is trading above 13,000 for the first time since May.

Lance Kuhlmann

Country Hedging, Inc.
The Right Decisions for the Right Reasons

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