Click here to view this report online.
  |
| ARKANSAS FARM BUREAU ELECTRONIC NEWSLETTER Bi-Weekly Market Briefings for 06-29-2007 -------------------------------------------------------------------------- http://www.arfb.com Cotton remains in a strong trend upward. After months of cellar-dwelling futures, New-Crop December Cotton Futures have led a major upturn and gained over 10 cents since mid-March. The move to 62.1 cents exceeded strong resistance just below 61 cents. Equally impressive has been the ability to hold above that while consolidating just below the high. A number of fundamentals came together to precipitate the move, including the lack of precipitation in Georgia, Alabama and parts of the Mid-South and how it affects perceived production. In addition, general wisdom is that cotton plantings will be well below March’s 12.14 million-acre intentions. China is expected to purchase almost 3 million bales in July–September. Much of it will come from the U.S. This week’s Planted Acreage Report might help set the summer market. Technically, a December close above 62.1 cents brings the 63.8-cent contract high back into play. Wheat fundamentals are providing new support. It got another boost after two weeks of consolidation just below the recent $6.18 July Contract high. Canada reported plantings down 10 percent-plus, the Ukraine cut projected exports more than 30 percent, and India reportedly will tender for 1 million tons. This combined news sent July back to $6.18 and, at $6.08½, the highest close for the contract. Compounding the situation further, extended rain is affecting the southern Plains and delaying harvest. Production losses are rising, and quality is falling. The April ’96 high of $7.17 is the next, and only, higher point on long-term charts. Corn has experienced a major correction. Improving crop conditions, including rain in parts of the eastern Corn Belt, has initiated a sharp downward correction in futures. In just six days, September Futures dropped from a $4.32 high to a low of $3.66½, a 65½-cent loss. That made a major reversal on the weekly charts and put the market in technical jeopardy. A close below $3.56 will retest long-term support at $3.40. The market is quickly moving from overbought to oversold, which may prompt renewed interest from funds. This week’s report is expected to show plantings of close to 92 million acres. Soybeans are dipping as the market shows its volatile nature. Like corn, beans have left a major reversal on the weekly charts. Simultaneously last week, November dipped 68 cents. Unlike corn, the bean decline was marked by a one-day upside reversal and a less ominous look and feel to the charts. While there are ample stocks, a much smaller planted bean acreage seems to have the market a little leery. That may limit the downside, at least in the short term. The Planted Acreage Report to be released late last week was expected to show a slight rise from March intentions. However, no one would have been surprised if it’d gone the other way, either. Crop ratings remain good, but we’re at least a month away from weather having a major impact on yields. Technically, November has support at $8.20–$8.25. Resistance ranges from $8.40–$8.65 to the contract high of $8.93. The milled Rice export market is slow. Many mills are still operating well below capacity as export opportunities become rarer. Although the demand side of the market is rather soft, expect the supply side to be firm. World stocks will decline again this year, and U.S. production will be lower. This week’s Planted Acreage Report should provide a better idea of ’07 production. Chances are good that plantings will be below the 2.64 million-acre March intentions, which were down 7 percent from ’06 and 22 percent from ’05. Arkansas was projected 13 percent lower, at 1.22 million acres. Technically, November Futures broke out of a consolidation area just under the recent $11.55 high, but quickly recovered. Overall, trading remains in a 6-month range between $10.65 and $11.58. Upside may be limited, but a smaller Planted Acreage Report may pressure resistance at $11.55–$11.58. Arkansas Poultry prices are lower on boneless/skinless breasts and thighs and higher on all leg quarters and wings, compared to last week. Generally, trading and demand was moderate, and reports improved on boneless/skinless breasts into retail features. Leg quarter and drum demand was fairly good for the adequate supplies. Export leg quarter price majorities were 43–45 cents F.O.B. Demand continues moderate-to-good into export channels. The market tone was steady-to-fully steady on drums and leg quarters; barely steady-to-weak on thighs and boneless dark meat, and steady on boneless/skinless breasts. Prices were: boneless/skinless breasts, $1.12–$1.65, with majority $1.29–$1.35; leg quarters (bulk), 44–53 cents, majority 44–46 cents; leg quarters, 46–51 cents, majority 48 cents; wings, $1.24–$1.31; thighs, 35–52 cents, majority 35–38 cents. The Live Cattle charts have taken on a bearish appearance. August is trending lower, and there is little technical support above $87. Cash prices have fallen below $90 for the first time in six months. Feeders have moved higher in recent weeks, thanks to weakness in Corn Futures. This market will likely move sideways-to-lower, though, until Live Futures find a bottom. Hog Futures have also turned lower. Larger-than-expected slaughter totals, combined with disappointing export movement, are creating a bearish situation. We expect this week’s Quarterly Hogs Report to show a 2-percent increase in the Market Hog inventory, which is pressuring deferred contracts, since it will result in very high fall production rates. August could retest support near $70. Contact: • Gene Martin (501) 228-1330, gene.martin@arfb.com . • Brandy Carroll (501) 228-1268, brandy.carroll@arfb.com . • Bruce Tencleve (501) 228-1856, bruce.tencleve@arfb.com . • Matt King (501) 228-1297, matt.king@arfb.com . -------------------------------------------------------------------------- We promised you your own bank, and here it is - www.farmbureaubank.com Created by members who understand your financial needs like no other bank can. Backed by the strength, stability and leadership of Farm Bureau. Go ahead. See what better banking is all about. Call 1-800-492-FARM Personal Bankers are available Monday - Friday, 7am to 7pm CST -------------------------------------------------------------------------- QUESTIONS OR COMMENTS? If you have any comments or questions about this e-newsletter please e-mail us at: mktrpt@arfb.com -------------------------------------------------------------------------- ---------------------------------------- HOW TO UNSUBSCRIBE You are receiving this newsletter because you requested that your e-mail address be added to the Arkansas Farm Bureau Market Report. To unsubscribe or change your subscription information, go to http://www.arfb.com/commodity/daily_rpt_email.asp ---------------------------------------- QUESTIONS OR COMMENTS? If you have any comments or questions about this e-newsletter please e-mail us at mktrpt@arfb.com Arkansas Farm Bureau Copyright 2007  |
No comments:
Post a Comment