Kleist Comments

CLOSING AGS 1/13/14
CLOSING AGS 1/13/14

Cattle: Cash cattle last week: $139.00-$140.00 & $221-222.00 dressed. On 39 boxed loads cut outs up. $1.76(c) to up. $2.0(s) on light midday movement.

Comments: Feb.’s rally a bit disconcerting if one kept buying on rallies. They have failed during its 6-day range. My concern is that the beef is nearing a high-water mark and seems impossible the retailers will (or can) pass along these increases to the consumer.

Of note: Jim Beam being sold to a Japanese firm. Whiskey with a Saki chaser?

Hogs: Interior hogs early not/est. (w), dn. $.53 (e); Pork cut outs fell $1.03, quiet.

Comments: The premium remains a problem largely because there’s only so many times one can justify by purely one vague possibility: PEV. Perhaps that is enough to keep the market (April-back?) from collapsing but conversely makes it tough to keep on buying it.

GRAINS & OILSEEDS:

Corn: Very choppy session and two-sided. Seemed like the bean pit was attracting the most interest. Prices still holding over the USDA’s slight decline in production numbers; USDA announced we sold China 120,000t SORGHUM.

Soybeans: Sharply higher led by spot January (expires tomorrow: final squeeze?). Why? Guess I’ll ‘fill in the blanks’: dryness in Argentina?; sold Unknown 140,000t old crop (announced later morning)?; technically? Basis open interest I suggested a ‘mini-battle’ has ensued and considering the C-O-T report perhaps the rally is commercial-led. Cannot be sure.

Wheat: Oversold the likely reason for the bounce, not the piddling 55,000t sold to Egypt over the weekend. About the time KC started break down there was a news story about Argentina’s government announcing that 500,000t will now be available (and 50,000t flour) for export and that another 1.0mln. will be allowed if production estimates hold up; Ag Minister said they will sell every “last kernel of surplus”. Argentina hasn’t exported for months trying to keep domestic prices in check. They also need more foreign currency.

Kleist Comments

This is John Kleist, of Kleist Ag Consulting.
Questions? Email me: johnwkleist@sbcglobal.net

Disclaimer: Trading options and commodities involves risk of loss and my not be for every investor. Past trading results may not be indicative of future performance. Although information and opinions provided herein are compiled from sources believed reliable, the sender, EBOT Trading, or its principals cannot attest as to accuracy or assume any responsibility for any errors or omissions as the information may not be complete or events may have changed.