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ALLENDALE, INC
4506 Prime Parkway, McHenry, Illinois
800-262-7538(March 10, 2000) SOYBEANS: With USDA subtracting 20 million out of end stocks they have made life interesting. We re own our old crop via a bull call spread and will position our hedges under a similar umbrella the closer we are to 30 to 40% of the Brazil soybean harvest. Interior basis is weaker as the upper Mississippi has opened and able to pull supply out of Wisconsin and Minnesota for needs at the Gulf. Yet another crush facility has closed due to what Cargill terms as more than abundant by-product supply. USDA did reduce export sales potential but offset the soyoil by increasing domestic demand by the same amount. Meal end stocks were left unchanged and now the bullish or bearish ball is in Mother Nature's hand. Spreads between the May and Nov remain mostly sideways trading in a range of 15 to 20 cents carry. Look for foreign demand to shift from the U.S. to South America about 3 weeks from today. As long as weather cooperates for a good quality harvest and good moisture for the Midwest, look for futures to come under pressure as outlined in our price projections. Today's trade range in the July was near perfect in this wedge formation. If this past week's high is taken out look for a move to 5.80. However if technicians decide to take the 511 low out then a move to 4.83 is likely.
Joe Victor
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