Kleist Comments

CLOSING AGS 5/14/14
CLOSING AGS 5/14/14

Cattle: Cash cattle last week: $146.00 south, $148-149.00 north; on 112 boxed loads cut outs dn. $1.35(c) to dn. $.03 (s) on heavy midday movement.
Comments: Futures stronger as beef movement continues large at prices
very near record highs. Retail bookings come to mind, surprisingly late, but perhaps beef exports have picked up as well. One big thing: June held major m/a support in early dealings.

Hogs: Interior hogs East Not/Est. again, West dn. $2.30-2.45;
Pork cut outs rose $1.57, big jump in bellies, again.
Comments: My take is that the Smithfield/Chinese take on a higher than expected loss this summer was behind the oversold whipsaw and sharply higher prices. Might have also helped the cattle? June nearing a nearly $10.00 premium to the current lean index and $15.00 over the high-end of the interior markets.

GRAINS & OILSEEDS:

Corn: Under pressure all session likely due to the hangover from a higher than expected planting report and technical selling under its major m/a’s. However, the $4.90’s has been a rough area to press the sell side. Unlike the beans, when the May expired at premium the July not only did not rally much it made new lows for the day.

Soybeans:
Nice whipsaw: as the time of the May contract’s expiry drew near and no collapse evident, I suspect the ‘boys’ came into goose the July because it’s still old crop but more importantly because of its discount to the May. Amazing. But light volume. Rest of session beans turned narrowly mixed.

Late notes: Brazil beans rumored to be already into the middle U.S.? Via New Orleans, Huston etc.?
And China said does not want to upset us and will not cancel anymore beans? Something’s rotten and I hope it’s not me.

Wheat: Big losses as rains in the southwest, favorable conditions in the east, Ukraine not far behind year ago plantings pace and a lack of visible export sales seemed to keep the funds adding to short positions. Also, many point to the USDA reports’ large world supplies.

Not that I like the company I am forced top keep but: GoldmanSachs reportedly said that barring weather problems, corn prices will drop 20%; beans 29%; and wheat 18%. And that’s from a big fund and the GSCI component.

Kleist Comments

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

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