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| ARKANSAS FARM BUREAU ELECTRONIC NEWSLETTER Bi-Weekly Market Briefings for 10-23-2009 -------------------------------------------------------------------------- http://www.arfb.com During the past two weeks, freezing weather and harvest delays triggered strong soybean buying that carried November futures above $10. Strong prices in crude oil and equities markets provided additional impetus. Both of these factors will need to stay in play if the crop is to maintain upward momentum and push the market toward August and September highs of $10.18 ¾ and $10.66. As harvest gains momentum and South American plantings continue, it will be difficult to hold current levels, unless there is aggressive movement by the investment funds. Support at $9.80, and then $8.80, could be tested. Corn could be topping. In recent days, the crop made continuous gains, stopping just below support at $4. Like with soybeans, the recent frost and slow harvest suggest future production estimates will be lower. There is concern that harvest will be a drawn-out affair, maybe even extending into next year. If that’s the case, yield and quality will suffer. However, there should be sufficient corn to meet demand and still have a substantial carryover. The key to higher prices will be outside markets and ethanol demand. December will need to close above $3.90 ½ to signal additional gains. A move below $3.76 would suggest a move toward support at $3.48. Wheat is having a tough time getting above key resistance just above $5.30. Recent gains pushed Egypt over to French supplies, reminding us just how competitive this market is. Big world supplies will likely cap upside potential, despite poor soft-red planting conditions. The market is well aware of the wet weather and slow harvest, which will limit new crop plantings and encourage attempts to buy additional acres. A close above $5.30 would be bullish. A close below $4.82 would be bearish. For cotton, the fourth time was a charm. On three prior attempts, December futures have failed to break above previous resistance at 65.5 cents. Recently, though, the commodity got the boost it needed. Continued rain in the mid-South and southeast production areas helped trigger strong buying, as concern about yield and quality grew. Prices accelerated further on a weak dollar and positive outside markets. Demand remains questionable with domestic usage still on the decline. The next upside objective is 70 cents, while 65.5 cents is now support. Rice temporarily rose above $14, boosted by the slow harvest and the potential for induced crop problems. Short-term, improving harvest activities will limit upside potential. A weak dollar is helping to prop the market up, but U.S. milled values remain well above those in Vietnam. Thailand has big supplies available but is still maintaining its government-intervention program. For the most part, poultry prices were static. Prices for tenders, leg quarters and boneless/skinless breasts were slightly lower than last week, and bagged leg quarters were slightly higher. Trade activity was light to moderate, with a best call noted on wings. Supplies of wings were limited, all other parts were available. Prices on export leg quarters ranged from 26-41 cents free on board, with the majority at 30-34 cents free on board. The market tone was steady to firm on wings and steady on the balance of parts. Boneless/skinless breasts were 95 cents-$2.22, with the majority at 96 cents-$1.01; tenderloins were $1.17-$2.14, with a majority at $1.25-$1.34; breast with ribs were 53-94 cents, with a majority at 57-58 cents; leg quarters (bulk) were 25-34 cents, with a majority at 27-28 cents; leg quarters were 26-41 cents, with a majority at 33-34 cents; and wings were $1.47-$1.51, with a majority at $1.47-$1.50. National slaughter estimate for broilers during the week ending Oct. 17 was 165,043,000. The total amount of eggs set last week in states participating in the 19-State weekly program was 189,656,000. The total amount set in Arkansas was 21,292,000. Last week, chick placements for the 19 states were 156,166,000, down from 160,080,000 last year. There were 19,434,000 chicks placed in Arkansas last week. Cattle futures are trying to trend higher, but futures are already trading at a wide premium to cash prices. Strength in the product markets hasn’t carried over into the cash market. Instead, packers have used the higher prices to improve their margins. For the time being, a large number of deliveries against the October contract are also limiting the upside. Live December has broken the long-term downtrend and completed a 38-percent retracement of those losses. Upside objectives are now the 50-percent retracement level of $87.13 and the 62-percent retracement level of $87.98. December hogs have been consolidating below resistance around $55. They recently charted a bearish key reversal after failing to challenge that resistance. Weak cash fundamentals continue to be a factor. Disappointing exports have kept a lid on the market, and news that one hog at the Minnesota State Fair had H1N1 could hinder exports even more. Support begins around $48. 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_marketing/email/ ---------------------------------------- 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 2009  |
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