Home Indiana Agriculture News Seed Consultants 4/5/2013 Weekly Comments with Gary Wilhelmi

Seed Consultants 4/5/2013 Weekly Comments with Gary Wilhelmi


Only 88,000 new jobs generated versus a hoped for 200,000. Dow off 160 points early Friday. NADAQ was off 49 and S&P 19. Labor participation is at a 35 year low. A weak ADP jobs report, 50,000 layoffs in March and rising jobless claims were the precursors
DAX and FTSE off 2% near their 10:30 close Friday. Japan doubled their stimulus efforts, and that knocked the props out, under the Yen. At $ .96 to the dollar and the yen has had a two year low at 80.
The Fed is more likely to stick with their bond buying stimulus, although there is a split opinion on strategy within the Fed governors. The ECB will continue its monetary policy, but their results have not added up too much.
WTI crude dropped this past week and that erodes bio fuel demand.
North Korea has been rattling its nuclear sword, which is not unusual, but more threatening. You have to wonder what is going on domestically. China has barred North Korean immigration, and that is understandable as they do not need more unproductive poor people. China has support of North Korea is a persistent thorn in our side. Limited flair ups are likely, as North Korea must keep their population engaged.
The Mid East remains a diplomatic mess with more troubled balls in the air then we can juggle.
It has been a tough few weeks in the grain and soybean markets following the bearish stocks report. Corn carry over, which will be reported in next Wednesday’s S/D report is expected at 850-900 million bushels, up from 600 million, and new crop weather allowing, could be 2 billion. Let me remind you, two-thirds of the Corn Belt remains to dry. It would take a few years of above average rain to restore our depleted sub soil moisture. Record corn acres are anticipated, and we get enough top dressing the crop could total 14 billion bushels. Currently, showers are predicted in parts of the northern Corn Belt, so watch how much and where it falls this weekend. December corn has a potential trading range of $4.50-$8.50.
South American soybeans supplies of great proportion, are moving out of Brazilian ports and so China will normally turn their attention in that direction. Bird flu in China has caused some human deaths and the culling of birds, and has also reduced bird feed demand.
China bought some wheat last week, but it is not likely, the dawning of a new age.
Export sales were light in wheat, fair on corn and soybeans to China are normally receding.
Volume of commodity trade had been quite light. Watch CME group stock value at $ 59, as it reflects trading volume and the recent low has been $ 50. General risk aversion is occurring in all markets. It is also notable that meats and grains are near their lows and short covering is always possible, especially in grains and oilseeds if the drought persists.
Meat demand is lackluster and threatening to get worse if the economy can not expand quicker. I know this is an old tune, but it dominates the juke box. The strong dollar also shaves import buying power. Support under June cattle is at $120 and June hogs at $88. Talk about grilling season is premature, and normally is not that impactful.
And in conclusion, the incorrigible bulls fought their back to just a 42 point loss on the Dow and the NASDAQ closed over its 3200 support level.