Financial
Employment report Friday AM with an expectation of 100,000 new jobs, but some see it as high as 160,000
The strong dollar may be a hint as we do better than our European ancestors
Crude oil holding steady was another positive indicator
Dow closed off 47 as the service sector measure was disappointing
Reduced Chinese, ECB and UK rates had little impact on their markets
If the Fed is to be motivated to stimulate the economy it will take a better jobs report.
Remember, the report is just one month so don’t get carried away
IMF warns the US to take proactive steps to guard against the first of the year fiscal cliff as tax cuts expire and debt deepens
Livestock
Cattle producers have $170 per head losses in their lots
Spiraling feed costs and dried cup pastures are a deadly combo
Heat beats up on meat demand as the dog days have come a month early
Feeder cattle remain squarely in the sights of the runaway feed markets
Cash hogs off $2
Pork cutout toppy off $2.29 with loins down $5
Super heat literarily trims the fat off animals
Grain and soybeans
December corn ran up to $7.08, November soybeans $15.27 and September wheat $8.38
Rationing will mean reduced feed usage, lower ethanol production that is currently off 5.2% from last year and exports in lesser amounts due the strong dollar.
How high is high? There is no telling as the drought with 76% agricultural coverage, shows no sign of relenting
This could reach national disaster proportions
Europe is struggling to stimulate their economies and they are our best customers
China is slowing and Japan has been in the soup for years
S American crop potential is good at the moment after having a punishing year last season.
The solar conditions now look disturbingly similar to the dust bowl and that’s statistically verifiable
It is already too late to help much of our corn as it is over 50% pollinating and that’s why we are over $7 on December and stampeding higher as we had August weather in June and now its worse.
Any sign of relief, and it may be cooler next week and look out, rain well that’s a different story.
But, what goes up 34 in corn and 52 cents in beans one day can go down even quicker
12:58pm ET
Dollar index up 1%
Cattle feeders losing $170 per head
Beef demand burnt by heat
Cash hogs off $2 and futures the same
Russian spring crops hit by dryness cutting exports and rising prices
Dec corn has been over $7, Nov. beans above $15 and Sept wheat beyond $8
10:43am ET
Corn and soybean usage contraction to match up with falling yields will come from reduced ethanol production, decreased feed utilization and lower exports
Ukraine grain cut to 20-21 MT by weather (Most important growth area)
Bulgaria has a wetter spring and production will be around 4 MT
Round numbers objectives at $7 in corn, $15 beans and $8 wheat
Cattle lack direction and open near unchanged
Heavy hog kill presses futures
Dow off 77
Crude oil up $ .12 at $87.17
Market Outlook
Financial
China, the UK and ECB lower interest rates but markets are not motivated
Dow off 55
DAX down .6%
Jobs report Friday with about 100,000 new additions which may be enough to bar the Fed from further easing
Costco and other chain retailers post slumping June
Dollar up sharply at 82.78 with a 52 week high at 83 .54
Gold and other commodities lower by $12 in gold at $1604
Euro falls to 1.24
Hang Sang index up .5%
Livestock
Choice boxes fall to $193 and $177 on select
It was as hot around the grill as on it yesterday
Cattle kill on par at 129,000
Pork cutout $2.29 lower, with loin’s down $5 and hams off $3.65
Hog kill up to 423,000 from 404,000 last week
Now demand will be put to a heat test
Grain and soybeans
Three days with high near 100 degrees in Chicago with a mild cooling coming but no meaningful rain
It is getting too late for rain to help corn that is better than 50% pollinating
We have another month of hunting and pecking regarding crop size before the August survey estimate
Dollar near its one year high chokes exports
Markets closed on the 4th reopen at 9:30 CDT this morning
Delta and Southeast may get some rain in 6-10 day time frame but not much and the Midwest will maintain a dry canteen
Eastern Europe into Russia and vicinity is a dryness curiosity
Export sales Friday AM
Wheat yields also suffering as September reaches $8.00
November beans have $15 in its sights
December corn surpasses $6.73 ½ resistance and could easily go over $7 based on present crop stress
Some ethanol plants are struggling to stay afloat