wmeubank@ocp.kcmo.com
ALLENDALE, INC.
4506 Prime Parkway, McHenry, Illinois
(October 31, 1997) CORN: December corn took out 280 support this week. The chart projects to 265. The funds are long a 5.4:1 ratio. Thus speculative money is at risk and will be fast to get out if the market doesn't quickly rally. Currently, with China selling corn and plenty of feed grains in the U.S. pipeline, we see no reason to be bullish near term. We expect USDA could lower the crop and lower exports. The result is little change in U.S. stocks. However, record tight world stocks should keep a firm tone until increased 98 acres are assured. We see end user buying 280 to 250 with the bulk of interest in the 265 area. The long-term up trend crosses near 265. We are currently short and will look to buy 265. If you have corn in the bin, why not keep ownership and buy a July 290 put for protection. You lock in a floor at near today's cash value and you'll gain one for one on the upside. If you have sold cash, look to buy back ownership with either futures or calls on this break. El Nino is alive and well and if there is a 1998 disaster, corn could be the leader and worth 400!
Bill Biedermann
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