Home Market Market Watch Gary Wilhelmi 5/24/2012 PM Comment

Gary Wilhelmi 5/24/2012 PM Comment


A docile day but the markets remain troubled by the impending Greek exit from the EU
The Purchasing Managers Indexes for Europe China and he US all sagged
Volatility continues as major part of all markets
Dollar up 24 at 82.33 maintains its preferred position among currencies
Long weekend with no immediate meetings, but no answers to economic ills either

Cattle mosey toward the weekend about $2 lower in light trade
Feature this week has been the bearish cold storage report showing 17% more beef and 20% pork
The report spotlights economically impaired consumer demand
Good cook out weekend for Memorial Day

Grain and soybeans
Sixty cent range top to bottom in July corn
First corn rallied on Chinese purchase rumors, then sold off on signs of no major buying until September and finally sold off sharply on rumors of Chinese cancellations
That’s pure speculative nonsense
Watch the Palmer Drought Index, but for now the Midwest looks pretty good
Weekly exports below estimates in corn and beans with wheat OK in the 12/13 period
IGC wheat production down to 671 MT globally versus 695 MT last year but still adequate
Don’t turn your back on Europe, holiday weekend or not


11:53 update

China may hold off of large corn buys until September
Iran buys 60,000 tons of Argentine bean oil
Corn and beans fall short of 1 MT + export sales targets
Quiet Dow up 29
Crude oil $1.04 better at $90.94
Dollar hangs above 82 at 82.13
Gold still volatile up $21 at $1569


10:24 update

IGC corn global carry 141 Mt up from 129 MT last year
IGC wheat production 671 MT down from 695 MT
Watch the dryness monitors in Corn Belt and Plains
China PMI declines in May
Short covering over night in wheat, corn and beans

DAX index up .8% despite EU meeting that accomplished nothing
Greece is expected to leave the EU and how disruptive will that be
US data, jobless claims and durable goods were flat.
German GDP in line but France PMI is at a 3 year low
New positions in any market are not likely given the high level of uncertainty
Volatility may take a break but look out for next week
Dow opens off 19 points

Cash cattle trade lightly at $121 in the south
Boxed beef up $1 at $195.50 on the choice
Bearish cold storage report pressures beef, up 17% from last year and pork up 20%
Pork cutout off $.96 with loin’s up $ .57 but hams down $3.15
Slaughter unchanged for week in cattle but hog kill is up 20,000
Nice eating weekend ahead

Grain and soybeans
Long weekend so many will pull in their horns
Protection quandary for grain elevators with dual closes at 1:15 and 2:00
USDA to survey producers regarding report releases within market hours—why wasn’t that done before the change?
Temps heating up toward 90 degrees in central Corn Belt
June development is an open question as always
Weekly export sales: Wheat a years low 72.000 for 11/12 and 754,000 for 12/13
Corn 156,000 tons for 11/12 and 352,000 12/13
Soybeans 800,000 with China 436,000 tons and 401,000 and 252,000 to China