CBOT Grain Futures Calls:

-December corn called 2 to 5 lower.

-November soybeans called 5 to 7 lower.

-December CBOT wheat called 2 to 5 lower.

US dollar is +21 at 76.64. November crude is down $.31 at $72.63. Dow futures are up 10 points.

Economic Information:

-The Dow closed at its highest level since October 5, 2008!

-This week’s economic reports for the US have been better than expected.

-Quadruple Witching is due today. The expiration of four different options, futures, and futures options related to the stock market can sometimes make for a volatile trading day.

-EU Monetary Commissioner says the idea of replacing the US dollar with an IMF SDR (Special Drawing Rights) currency is “unviable”.

-China’s Community Party has indicated it will stick to its pro-growth policies.

Go to our homepage, www.allendale-inc.com, to view our latest market update videos, recorded twice a day (before and after the grain market session).


-There is no crop concerning cold weather in the two week forecast. Off and on rains and mild temps are the rule.

Grain Market Influences:

Corn summary… Traders were trying to rally futures last night but before 7 am the new GFS model confirmed that the likelihood of a hard freeze was quickly melting away and then to top it off, China said they would subsidize up to 2.0 mmt of corn with a $36.63/tonne subsidy.

Malawi sells 80,000 tonnes of corn to Kenya and to Zimbabwe.

Taiwan purchased 60,000 tonnes of corn from Brazil.

South Korea updated its import statistics overnight. It has imported 8.5 mmt of corn between January and August. That is down 30% from the same period last year. Of that amount imports from the United States total 3.4 mmt during 2009 year to date. That is down 56% from last year!

Soybean summary… So far early yields are coming in really good but trader perception is that they will not be that good when IL, IN, IA revs up and harvest delays in N Delta provided support. Remaining frostless into Oct 4 would make us bet the odds yields will improve.

The general manager of a grain firm in China’s largest soybean growing province, Heilongjiang, estimates frost and other factors have impacted production by 3 mmt. That brings production in that province down to 5 mmt. China’s official government forecast is for 2009 soybean production to be 14.5 mmt which is down from 15.5 last year.

Wheat summary… Wheat futures continue to be a problem for the exchange, regulators, cash traders and index funds. Index funds are massively long which has kept prices at a premium to cash. This has put more pressure on regulators to resolve position limit exemptions and the premium in futures has prevented convergence causing.

South Korea purchased 55,000 tonnes of feed wheat. No supplying country was listed in the announcement.

India’s 2009 wheat crop may come to 79 million metric tonnes. That is down 2% from last year and not too bad considering the problems with monsoon rains this season.

Contact Allendale to schedule a speaker for your Fall/Winter meetings!

Livestock Comments:

-Wholesale beef closes down $.65 for choice and down $.25 for select.

-Pork carcass cutout closes up $.28.

-Cash hogs are called steady.

Livestock Futures:

October Lean Hogs are called 20 to 40 higher.

----Chart support 50.75 and resistance 54.50

October Live Cattle futures called 20 to 30 lower.

----Chart support 86.70 and resistance 87.90.

October Feeder Cattle futures are called 10 to 20 lower.

----Chart support 98.00 and resistance 100.30.

Livestock Market Influences:

Cattle on Feed will be released at 2pm today.

Lean hogs summary… While pork prices have been in a confusing mix of sideways action, cash hogs and futures have been able to post some gains. Cash hogs are now called to open steady to lower tomorrow based on ideas of packing plants not needing to reach out to find numbers for next week.

Live cattle summary… Today was a disappointment for feedlots. Live based feedlots from Kansas through Texas traded cattle from $84 to $84.50. Assuming an $84.25 average price, that was down about 50 cents from last week’s $84.78 average as posted on the Five State report.