Home Market Market Watch Seed Consultants Market Watch Weekly Comment with Gary Wilhelmi 12/14/2012

Seed Consultants Market Watch Weekly Comment with Gary Wilhelmi 12/14/2012


The House has gone home for Christmas and Obama heads for Hawaii Monday, so nothing has been accomplished as regards our fiscal dilemma. The Fed gave us another monetary boost, but the markets reaction was tepid. The Fed chairman made a point of the need for fiscal action and that monetary policy can not turn our massive economic ship of state. After the first of the year the problems of excessive spending, the need for more revenue or higher taxes and the debt limit will all be present and getting worse.
In Europe, Italian politicians continue to fiddle while Rome economically burns. The rest of the EU is confused. The UK credit rating is on the verge of being cut again, and that is another fine example of socialism. China is sending mixed business signals, and remember, we have enough trouble trying to figure out how we are doing let along China, a largely secret society, with a strong incentive to fabricate the facts.
The grains have sunk toward support at $7.10 on March corn and $7.75 on March wheat. Jan beans, on the other hand, powered by strong exports, test resistance at $15.00. Soybeans exports sales hit 1.32 MT this last week with China taking 1.008 MT. In January, China normally turns their attention to S. American soybeans and supplies look plentiful. Brazil beans estimated at about 82 MT and Argentina 55 MT. The grains, in soaked Argentina are not doing so well. Brazil is coming on as a substantial competitor in corn.
Wheat dropped over fifty cents following the S/D report, in which carry over was raised by 50 million bushels, due to poor exports, and business is much worse in corn. Dryness remains, in the HRW area of our plains, and the Volga region of Russia has been awfully cold. Old wheat concerns in Eastern Europe, Australia and Argentina appear to be discounted.
The big muddy is near a critical low and may be there by December 28th. There is no water relief in site; indeed the Chicago drawing area has not had measurable snow in almost 300 days. The heavy snows out west have been on the Pacific side of the divide.
February cattle bounced off $130 support with resistance at $133. Early Texas cattle cash was at $124.50 up $.50. Boxed beef in choice cuts is hanging around $196 cwt. Slaughter this past week, was on par with the pervious week in both cattle and hogs. February hogs bounced off their season’s low on short covering. Holiday meat features are mixed and budget conscious. Meats are especially sensitive to economic conditions and our business world has a fever.