PGG Market Report

PGG MARKET REPORT

PGG Country — Fri, 30 Jul 2010 10:59:41 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 30 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
August	5.70/ 75		7.46	*.65*	6.35	*-.35*	120	154
September	5.80	*6.53 CUW*	7.46	.65	6.35	*-.35*	120
October	5.85		7.60/ 65	*.65/ 70*	6.77	*-.10*		154
November	5.85		7.70	*.75*	6.82	*-.05*		154
December	5.85	*6.85 CZW*	7.75	*.80*	6.87	*.00*		155
January	5.90		7.94
February		*7.06 CHW*
N/C 2011		*7.10 CUW*	*7.61*	*.50*	*6.91*	*.00 KUW*		2011/ 164
N/C 2012		*7.14 CUW*						2012/ 165
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.171/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

Markets didn’t take Friday off! Futures called up 1-4 opened up a dime, quickly moved to +.24 and just stuck there. Corn is even feeling a little love from the wheat pits, up 8 in sympathy. IF this drought is as bad as advertised, corn will explode, if not wheat will collapse…there are plenty of articles out there to promote both ideas. Here is a quote I found ‘interesting’: “Comfortable supply levels should keep prices from returning to record levels above $13. Inventories for the 2010-11 marketing year are pegged at a 23-year high”. And so it goes. I made a comment the other day that I hadn’t seen markets like this in 30+ years…then Bloomberg ran an article that said we are seeing the biggest 1 month wheat move since 1973 (year of the “Great Grain Robbery”). It was before my time, and although I remember ‘old timers’ talking about it, I can’t find out exactly how quickly/ or how fast that one faded. The numbers that drove that rally were truly staggering (also a demand driven rally). While searching for perspective, when we had the ‘surge’ of ’07, (worldwide economies were in GREAT shape, we were just coming off of disasters in the US, France, Germany, Canada and back to back wrecks in Aussie) wheat started its move in earnest in early August of ‘07 at $6.26, by the middle of Oct ’08 it was all over. We went from $6.26 futures/ $6.40 cash to a high cash bid of about $15.85 on 1/28…futures didn’t top out till 2/28 at $12.80. That was a ‘demand driven’ market. This one is a spec driven one. ND crop tour issues final est of 46 bpa for ND.

Russia’s United Grains said they expect to still export 1 myn mt quota, while there is more speculation that Russia may use intervention stocks for domestic needs (which is what they were intended for, not exports). The Hot/ Dry continues (thought it was supposed to be hot/ dry in July/ Aug?) weather man sez no reprieve for at least the next 7-10 days. India’s monsoon now rated at +7% with above average precip called for Aug/ Sept. Grain Corp of Aussie bot out the AWB making them the largest wheat exporter in Aussie.

HAVE A GREAT WEEKEND!!!

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Thu, 29 Jul 2010 11:57:09 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 29 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
August	5.60/ 65		7.24	*.70*	6.07	*-.35*	120	152
September	5.70	*6.22 CUW*	7.24	.70	6.07	*-.35*	120
October	5.75		7.45/ 50	*.75/ 80*	6.49	*-.10*		152
November	5.75/ 85		7.55	*.85*	6.54	*-.05*		152
December	5.90	*6.54 CZW*	7.60	*.90*	6.59	*.00*		153
January	5.90
February		*6.79 CHW*
N/C 2011		*6.70 CUW*	*7.45*	*.50*	*6.91*	*.00 KUW*		2011/ 163
N/C 2012		*7.05 CUW*						2012/ 164
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.171/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

NOTE: We rolled to the August this morning due to lack of interest in the July. The futures are awful ‘twitchy’ this morning starting up hard early, then giving a bunch back as the morning wore on. Portland is trying to cover needs. The delay in harvest and strong run in the futures has those short in Portland scrambling. Expect lots of interesting things to happen to these markets until this crop is safely tucked away. Wheat rally is the strongest/ fastest in 37 years…Yup 1973 Russian deal…just a little ahead of my time. Sales report this morning had mediocre corn numbers at 37 myn bu, wheat numbers were VERY strong at 33.7 myn bu 2.4 myn was SWW. Basis levels have been hammered, but even as futures work higher, the damage ‘appears’ to be done, and although we have weak basis numbers, the futures are carrying more than their share of the load. ND crop tour found more bushels…yesterday’s ave was 46 bpa.

The news out of Russia continues to tease and offer enough to keep both the bulls and the bears interested (although the bulls are firmly in charge of the futures). Russian gov’t said winter yields may be down 10% while spring crops could be down 30-40% (particularly the feedgrains). It is interesting that Corn has not really participated in this rally…at least yet. Corn/ Wheat spread is near $2.50 which is about a buck too high in favor of wheat…something MUST give there. If the drought is as bad as advertised, corn will have a big move, if not, wheat will collapse. Russian gov’t also maintains that there will be NO export controls. One other item regarding this area: it has been suggested that the Ukrainian gov’t will monitor quality and use it to effectively manage exports…interesting twist. The IGC came out with their latest projections and knocked 13 myn mt off world wheat production (not a surprise, USDA will be cutting their’s as well). Article reminded that they are still projecting the 3^rd largest wheat crop in history. Ending stocks are proj at 192 myn mt vs. 201 proj earlier and 197 myn mt to end last year. The EU has approved 6 GMO corn varities for import/ consumption…NOT cultivation, opening the door a bit wider for potential US corn exports. Egypt did tweak their import restrictions and will allow French sales to load from multiple ports.

***Didja Know: The average teenager sends about 1740 text messages/ month (over 50/ day). 42% of the people surveyed in Rhode Island did NOT realize that Rhode Island was NOT in fact, an island.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Wed, 28 Jul 2010 13:55:19 -0700

Morrow County Grain Growers

Pendleton Grain Growers

Duane Disque Or Brian Peiler

Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221

1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (work), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!

Below are the best indications available as of:

9:00

7/ 28 /10

SWW

SRW

DNS

HRW

Barley

Corn

Month

Portland

Chicago

Portland

Basis

Portland

Basis

Portland

Cash Px

July

5.40

7.05

.65 ?

5.74

-.35 ??

120

152

August

5.45

7.05

.65 ?

5.74

-.35 ??

120

September

5.55

6.13 CUW

7.05

.65 ?

5.74

-.35 ??

110

October

5.60

7.31/ 36

.75/ .80

6.16

-.30/ -.22

150

November

5.70

7.41

.85

6.21

-.16/ -.03

150

December

5.80

6.45 CZW

7.46

.90

6.26

.02/ 06

152

January

N/C 2011

6.87 CUW

7.42

.50

7.06

2011/ 160

N/C 2012

7.05 CUW

+25/ -30

+20/ -30

2012/ 161

***Club premium: $Call!! B/C

MSTOS

CANOLA:

.172/ lb

***NOTE: Corn bids vary depending on point of delivery. Please Call for Updates.

Futures resumed their surge northward, as Paris and London set new highs yesterday. Today’s rally has the futures recovering all the ground lost the last few days plus a few more. Corn is still well off the highs set a couple weeks ago when Dec hit $4.05. The cash SWW market has been absolutely stunning to watch. We have 4 exporters that run facilities in Portland, and 1 reseller. The re-seller is apparently short and searching for replacement as his numbers are .40/ bu higher than the ‘average’ exporter. One exporter is showing carries of .03/ bu / DAY thru the last part of August. So apparently other than a small spot shortage, Portland is willing to book HUGE carries to keep deliveries into the deferreds. I have said it before (and not that long ago), and I’ll say it again 30+ years of this stuff and I have never seen markets like these! By the end of the week we ought to be able to get some definitive reports on just what the drought areas will be producing. If the drought pans out, it will/ should ultimately be supportive of US cash prices, and futures are simply leading the way. Right now all we have is ‘tire kickers’ in Portland. Russian gov’t is trying to weigh in on the situation, they are adamant that there are NO restrictions or proposals for restrictions to exports. The whole thing was apparently kicked off by "Traders said prices spiked on spec trading stemming from an analyst note that there was a ‘high chance’ that Russia may restrict exports. It is possible maybe even likely that the spring crops will be hurt more than the winter crops, meaning the impact on wheat may be blunted? Now you know what we do….Brazilian farmers are 5% behind last years marketing pace (with bigger crops to sell this year). India’s monsoon looks like it will totally catch up and should be above average for August/ September.

Weather in the corn belt continues to be excellent. Traders are trying to anticipate what the USDA may do to production numbers in Aug. The 163.5 bpa yield est for corn sure looks low right now. Silking is 2/3 ahead of last year. Corn in the dough stage in Ill is 18% vs. 1% last year. First day of the crop tour in North Dakota had yield estimates running 42.7 vs. 45.9 last year.

***Didja Know: If your wondering about your combine or trying to estimate ‘shatter’, It takes 22 kernals/ square foot (all across the acre) to equal 1 bpa.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Tue, 27 Jul 2010 15:12:18 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 27 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	5.20		6.93	*.65?*	5.84	*-.35?*	120	148
August	5.25		6.93	.65?	5.84	*-.35?*	120
September	5.25	*5.98 CUW*	6.93	*.65*	5.84	*-.35?*	120
October	5.35		7.19/ 24	*.75/ 80*	6.26	*-.10*		146
November	5.45		7.29	*.85*	6.31	*-.05*		146
December	5.50	*6.30 CZW*	7.34	*.90*	6.36	*even*		148
January	5.55	*6.56 CHW*
N/C 2011		*6.76 CUW*	*7.29*	*.50*	*6.64*	*.00 KUW*		2011/ 159
N/C 2012		*6.95 CUW*						2012/ 159
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.171/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

Hmmm interesting day so far. More news focusing on the Russian/ Ukraine crop. Wheat opened up 15, gave it all up, traded lower…then reversed and is currently up again 4-5. Corn was up 6 traded down -3, back to +4 and has given it all back again. It is like someone is sitting flipping a switch back and forth. Ukrainian gov’t has not ruled out limiting exports the 2^nd half of the year, vessels are still getting loaded, they are 5 deep in the Black Sea ports. Here’s another article for you: Kazakhstani gov’t says this years harvest will be 13.5 to 14.5 myn mt, down 36-40% vs. last year. (Last year was a HUMONGOUS crop). The article goes on to say we are carrying 7 myn mt over from last year, ‘so this amount of grain is enough to meet domestic needs and maintain the countries high export potential’.

Crop reports show corn silking at 84% vs. a 5 year ave of 70%. The G-Ex % is unch’d, but they did move 2% from G to Ex. Weather looks awesome for corn country, with even the dry areas expecting rain. Overnight Japan booked 2.6 myn bu US and about 1.4 Canadian and Aussie. Early results back from ND crop tour bpa/ yield will be equal to last years phenomenal yields. Growers are more optimistic as the crop is 2 weeks at least ahead of last years LATE crop. Bill going through the house today has ethanol tax credits being extended 1 year, but reduced 20% to .36/gallon. Also extends the import tariff 1 year at .54/ gallon, and re-instates the Bio-Diesel credits.

China has expressed concerns over quality of US corn. Shouldn’t be any surprise, except that we are actually able to ship any #2’s. The problems with last years crop are well documented. Even so, there have not been any rejections…yet anyway. The amount of corn China imported from the US this last year is more than the previous 15 years causing some concern in China about putting the ‘rice bowl in others hands’. The potential is there, but there is a real question whether it will happen politically. USDA has approved a total of 27 chicken processors to resume shipments to Russia. Brazilian beef will start hitting US shores in a month as exports are set to resume.

***Didja Know: There are 12 flowers on each side of an ‘OREO’ and each flower has 4 petals? USDA proposed using yogurt as meat substitute in 1996 for school lunches? Pineapples originated in South America, they didn’t make to Hawaii till early in the 19^th century.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Mon, 26 Jul 2010 09:51:07 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 26 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	5.05		6.85	??	5.75	*-.35?*	120	148
August	5.05		6.85	.65?	5.75	*-.35?*	120
September	5.05	*5.88 CUW*	6.85	*.75*	5.75	*-.35?*	120
October	5.10		7.11	*.80*	6.17	*-.10*		146
November	5.15		7.21	*.85*	6.22	*-.05*		146
December	5.20	*6.19 CZW*	7.26	*.90*	6.27	*even*		148
January	5.25	*6.45 CHW*
N/C 2011		*6.67 CUW*	*7.20*	*.50*		*.00 KUW*		2011/ 159
N/C 2012		*6.88 CUW*						2012/ 159
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.171/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

Futures were lower overnight, and carried that right into this morning. The market seems ‘comfortable’ trading the idea that the CIS (Commonwealth of Independent States) and Russia will notch about 16 myn mt of reduced GRAIN production. Spring crops will be hit the hardest, particularly rape. Ukraine and Russia are running about 60% harvested, and are ahead of normalThe losses may not be anywhere near that bad, but that is what we ‘think’ the market is trading today. Long term corn demand looks very good, if the word coming from China is accurate. We have heard stories for years about how big the Chinese market is, but it has been mostly a tease. Due to growth in demand for meat, milk and eggs they claim they may need to import up to 15 myn mt (590 myn bu or roughly 4.5% of the US corn crop) by 2015. The market obviously ‘likes’ the idea, but will wait till the orders start coming in. Last week Chinese gov’t ended up offering 4.5 myn mt of corn for auction, only 370m mt was purchased. India was running near 20% behind normal in monsoons till this past weekend, when the driest parts of India got 3-6”. They are now rated only -7% vs. normal. Other world weather: No significant rains (only scattered showers across WA this week). No excessive heat, and scattered showers across most of the EU. Rain won’t help/ hurt crops, but will help cool things. The CIS will remain hot/dry for the next week/ 10 days. Some scattered showers here also, but not enough to curb drought, or do much good.

Over the weekend, most of the corn belt got good rains, with heavy flooding in parts of the country. This afternoons crop cond report is expected to show a small increase to corn scores. 2 more systems will provide rain that will keep the temps in check and help soil moistures this week. Wheat tour starts in North Dakota this week. On the upcoming USDA report (8/12) expect bigger prod numbers from US wheat and corn, with world wheat production down 10-15 myn mt. COT report (depending on which one you read) the one I use shows specs long 125 myn bu of chic. The one most often ‘referred’ to show them short 110 myn bu. So they are either worthless, or very valuable depends….I also see specs now long corn 985 myn bu. Shipment reports showed decent but under numbers for corn with only 42 myn bu shipped, while wheat only tallied 15 myn bu (only .8 myn bu of SWW). Pilgrims pride received permission to start exports of chicken to Russia. Higher gas prices/ lower corn is also helping with the P side of P/L for ethanol. A new study suggested that the ethanol industry would not be hurt that bad by eliminating the .45 / gal blenders credit…you can get a study on about any topic, and probably about any result you like, I bet the RFA has one that would argue the opposite side.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Thu, 22 Jul 2010 09:02:08 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 21 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	5.05		6.90	??	5.71	*-.15?*	120	154
August	5.05		6.90	.65?	5.71	*-.10?*	120
September	5.05	*5.95 CUW*	6.95	*.75*	5.71	*-.05*	120
October	5.10		7.20	*.80*	6.20	*-.05*		150
November	5.10		7.28	*.85*	6.25	*0.0*		151
December	5.15	*6.25 CZW*	7.33	*.90*	6.30	*0.0*		152
January		*6.49 CHW*
N/C 2011		*6.72 CUW*	*7.29*	*.50*	*6.70*	*.00 KUW*		2011/ 160
N/C 2012		*6.95 CUW*						2012/ 160
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.171/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

“Unusually uncertain times”…not real comforting, but it does accurately describe todays marketplace. Futures opened sharply higher following the London and Euro markets, then gave up some ground and have settled down a little, for now anyway. Corn is about even, wheats are still up 10 to 14. One of the most amazing things to me, is to see the structure of the market and see how fast it changes. For example: .31/ bu CARRY in the Chic futures from Sept to Dec! Rolling from the Sept option to the Dec option results in HUMONGOUS carries in all classes of wheat. Today, corn is the only market that is trading ‘normal’ or about what you might expect given fundamentals. On the one hand specs are pushing futures in an attempt to ‘buy the last bushel’, then to reward the market with carries that are just massive, suggesting they really don’t want the wheat afterall. If you were a sailor you would call these ‘confused seas’.

Market has been focusing on production cuts, and we have covered the various cuts to a point where now we are in a ‘lets just wait and see what the combine says’. We do know that Aussie is carrying 9.9 myn mt still from last year, Russia is sitting on 24 myn mt and the Ukraine has 6.7 myn left over. Ukraine Ag Minister said they would likely only have 16 myn mt from this year. I did read one article that suggested that the Russian wheat crop could drop to as low as 75 myn mt…NOW THAT WOULD BE NEWS, and worthy of a strong rally! The Russian wheat harvest is actually yielding ahead of last year today, but the bulls say ‘they ain’t got to the drought damaged stuff yet’. Russia did ban imports from 2 US pork packers. One of them, the world’s largest is Smithfield in North Carolina. They did not offer any explanation.

Sales report showed 24 myn bu of o/c corn and 20 myn bu of n/c (again the corn market seems to acting in a rational way, with realistic carries in the futures). We officially beat the USDA sales projections, but at this pace we will miss actual shipments by about 100 myn bu…NOT TOO BAD…but it will still increase beginning stocks by a like amount. Wheat sales were less than hoped for, but considering the convulsions this market has been through, not bad at 14 myn bu. So far this year, we have missed the USDA numbers (I still think they are too high), but we are very early in the marketing year.

***Didja Know: Even with the building of the ethanol industry, records show that the average miles a carload of corn travels is about 160 miles further than in 2001? After accepting GMO technology, the farmers in Brazil have it planted on about 42% of all acres..

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Wed, 21 Jul 2010 11:53:22 -0700

Morrow County Grain Growers

Pendleton Grain Growers

Duane Disque Or Brian Peiler

Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221

1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (work), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!

Below are the best indications available as of:

9:00

7/ 21 /10

SWW

SRW

DNS

HRW

Barley

Corn

Month

Portland

Chicago

Portland

Basis

Portland

Basis

Portland

Cash Px

July

5.05

6.80

.65??

5.74

-.30??

120

151

August

5.05

6.85

.70??

5.74

-.30??

120

September

5.05

5.89 CUW

6.90

.75

5.74

-.30??

110

October

5.10

7.07

.80

6.16

-.05

150

November

5.15

7.17

.85

6.21

Even

150

December

5.20

6.19 CZW

7.22

.90

6.26

.05

152

January

N/C 2011

6.66 CUW

7.22

.50

7.06

2011/ 160

N/C 2012

6.94 CUW

+25/ -30

+20/ -30

2012/ 161

***Club premium: $Call!! B/C

MSTOS

CANOLA:

.172/ lb

***NOTE: Corn bids vary depending on point of delivery. Please Call for Updates.

Futures resumed their surge northward, supposedly following crude, but crude is back to even and the futures, though they have given up some ground are still posting large gains. Corn is up 5-6 while wheat futures are up 11-14. Looks like the specs have resumed the push. It will be interesting to see how much ‘push’ is left. With no big reports due (next USDA is due out 8/12), and no worries of delivery till the end of August, they pretty much have a free hand. I wonder if any of the HRW guys (especially the ones with lower pro) will make delivery against Chicago futures.

Overnight Algeria booked 300m mt (11 myn bu) from France at $6.53 type levels. It is comforting to know that the futures surge here is not only opportunity for our growers, but helping our competition sell. Algeria paid about $1.20 / bu more than they would have had to a little over a month ago. One of the ‘truths’ of the grain markets is that high prices will cure high prices….

Basis levels continue to get beat down as futures rise. Exporters do NOT want the grain…take a peak at the HRW carry…No one is really sure what to pay for DNS in the nearby, so those bids are built by looking at the deferreds and trying to figure a decent carrying cost. From what I hear the crop size in Montana and the Dakotas is HUGE, and the USDA will likely have to revise the production numbers up in August. Heat and humidity (mostly humidity) have killed an estimated 2000 head of cattle in Kansas. Showers and cooler weather should arrive this week.

Kazakhstan revised their wheat production lower to about 11 myn mt, vs. 13.5 or so last year, so they will be down a couple myn mt.

***Didja Know: "One thing that is for sure…that you can count on is Change". Out of respect for George Washington, during the civil war, both side considered his home of Mount Vernon neutral ground, and neither side attempted to occupy it. "Well done is better than well said" Benjamin Franklin.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Tue, 20 Jul 2010 09:46:45 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 20 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	4.90		6.72	??	5.68	*-.15?*	120	152
August	5.00		6.78	.65?	5.70	*-.10?*	120
September	5.05	*5.75 CUW*	6.84	*.75*	5.80	*-.05*	120
October	5.05		6.95	*.80*	6	*-.05*		150
November	5.10		7.05	*.85*	6.04	*0.0*		151
December	5.10	*6.04 CZW*	7.07	*.90*	6.12	*0.0*		152
January		*6.30 CHW*
N/C 2011		*6.55 CUW*	*7.10*	*.50*	*6.70*	*.20 KUW*		2011/ 160
N/C 2012		*6.80 CUW*						2012/ 160
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.168/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

Futures are mostly lower all across the board. DOW is down hard. Be CAREFUL out there. Basis levels are getting squeezed tighter every day and the relationship between Cash and Futures more strained. Red Wheat basis number stink as much / more than the Portland/ Chicago basis. ?? under basis indicate that these bids are VERY sketchy. Post harvest bids are much more ‘solid’. Even new crop corn basis is getting ‘soft’.

Results of the Egyptian tender were VERY interesting. Egypt tendered for 1 cargo of 60m mt (they often buy more). Then the world’s grain trade works up offers on the various classes of wheat and submit them. Last night Egypt ended up booking 2) 60m mt cargos from Cargill and Dreyfuss both shipping from RUSSIA. They actually offered 5 cargos…doesn’t sound like some of the news stories we heard about them banning exports. Price was also interesting. The sale went down at $5.77/ bu FOB. Today, Russia enjoys a $15/ ton freight advantage, but still beat the BEST US offer by $20/ ton or .54/ bu. Russia did sell the wheat at a $24/ ton premium vs. their last sale back in June….thanks to the futures rally in the US. Rally clearly has not made us more competitive. I don’t have all the numbers but know that France also offered 2 cargos at $5.96 (but were also beat out by the Russians). We do know that the Egyptians entertained offers from: Russia, France, Aussie Soft and Hard wheats, Germany, Argie, Romania, Kazakhstan, Ukraine, United Kingdom and Canada and of course various US offerings.

US corn scores did drop 1% to 72% G-Ex. Spring wheat ratings also took a tiny hit dropping 1% to 82% G-Ex. I’m not sure that I have ever seen spring wheat ratings this high, this late in the year. We did manage a 115m mt sale of beans to China. USDA says that there are 4.5 myn acres due to expire from CRP. The O Admin wants to renew/ re-enter or have up to as close as 4.5 myn bu back in to maintain the current CRP levels.

***Didja Know: Says here that if all the empty space were removed from around all the atoms of the universe, the resulting matter would only be about the size of a grapefruit. Can that be right? The first commercial TV sets weighed in at 700 lbs. JP Morgan was once approached by a man on the street and asked ‘what was the market going to do?’ he said ‘Fluctuate’….hmmm an answer for all seasons.

PGG MARKET REPORT

PGG Country — Mon, 19 Jul 2010 11:32:10 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 19 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	4.85		6.60	??	5.80	*-.15?*	120	152
August	4.95		6.65	.65?	5.82	*-.10?*	120
September	5.00	*5.79 CUW*	6.75	*.75*	5.87	*-.05*	120
October	5.05		6.97	*.80*	6.00	*-.05*		152
November	5.10		7.02	*.85*	6.09	*0.0*		152
December	5.10	*6.08 CZW*	7.07	*.90*	6.14	*0.0*		153
January		*6.30 CHW*
N/C 2011		*6.53 CUW*	*7.08*	*.50*	*6.70*	*.20 KUW*		2011/ 160
N/C 2012		*6.87 CUW*						2012/ 160
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.168/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

WOW things have been just crazy this morning! Sorry for getting the report out so late this morning phones started early and have been very BUSY. Today is probably not a good time to start studying for finals. Futures started lower and wheats have tried to come back to even. Every time they get close, pressure mounts they lose ground all over again. Corn started down 10-12, worked back to -4 or 5 and are now down 17. Rain and a bit cooler weather will run from Nebraska to Ohio. Corn is pollinating, and the weather is GREAT. Expect corn crop scores to remain very high (small decrease in score possible) in this afternoons USDA crop progress/ condition report.

Russian drought scare is, well ill-defined. I have read articles that said it is the worst drought in the last 130 years, the driest its been since ’72, and this morning an article that said this is the worst drought in the last decade…take your pick. Russian Grain Union estimated their wheat production 85-87 myn mt at the beginning of the month, rated the crop at 81-85 myn mt…essentially the losses range from nothing to 6 myn mt. The weaker $ has helped, as well as ocean freight rates which seem to be near the hopeful bottom. Additional shipping capacity and a slower Chinese economy has really dinged the Baltic index.

Funds bought an estimated 380myn bu of corn last week…and according to the COT report (which does NOT include anything past last Tuesday) they are now long 790 myn BU! Add the fund position of 2 byn bu long and you have a HUMONGOUS spec long position. Specs also added a ton to their Chicago positions…read LOTS OF AIR under these futures numbers.

Iraq booked 1.8 myn bu from Romania, Aussie, Canada each and 3.6 myn bu from the US and Russia. US wheat sold for $292/ mt, while the Russian version went down at $250. Total shipment report showed corn once again missing the mark with only 38.9 myn bu shipped (-16 myn bu vs. the USDA est). Wheat shipments were strong with 22.4 myn bu shipped which is about 3 myn bu more than needed to hit USDA numbers.

Economic news: Moody’s downgraded Ireland to AA rating and the US homebuilder said that new home starts are at a 15 year low.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Fri, 16 Jul 2010 10:47:54 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 16 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	4.95		6.74	??	5.80	*-.15?*	120	154
August	5.05		6.75	.75?	5.85	*-.10?*	120
September	5.10	*5.81 CUW*	6.84	*.80*	5.90	*-.05*	120
October	5.15		7.05	*.85*	6.07	*-.05*		153
November	5.20		7.10	*.90*	6.12	*0.0*		153
December	5.20	*6.09 CZW*	7.15	*.95*	6.12	*0.0*		155
January		*6.31 CHW*
N/C 2011		*6.56 CUW*	*7.11*	*.50*	*6.70*	*.20 KUW*		2011/ 160
N/C 2012		*6.88 CUW*						2012/ 160
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+20/ -30*	*Canola:*	*.168/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

After some strong rally, futures were due for a ‘breather’. This will specs/ funds a chance to take profits/ and consolidate. We talk about perspective a little later. Talk about specs having control of this market, yesterday they bought 17-20m caks in Chicago alone! OI in corn jumped 35m caks. But there are some other things to also take note of in the structure of the market. As we entered July del’y, we did the math explaining how a long could take delivery of the wheat, turn around and sell a futures position against it 12 months later and ensure a tidy 8-9% ROI (total carry was well over $1.10). Today the Sept to Sept spread is down to .77. NO WAY that dog hunts today! Reduced carry will drastically alter the specs/ funds approach to this market. Carries in the market have been a very useful tool to measure the strength of bull/ bear market, but other factors (like the VSR) are dulling those type of tools. Also there is word from DC that there is movement afoot to reduce ethanol tax credits 20% to .36/ gallon.

We have known all along that you can’t realistically maintain the high crop scores all over the world forever, so now when the story breaks that there will be production cuts, we need a way to estimate the impact. World stocks have grown over the last 3 years to around 190 to 193 MMT up from 125 to 130. Considering a stable domestic use of around 650 MMT (as last year), it would take a production loss of more than 30 MMT to start eating into stocks---a total loss in production of over 50 MMT would lead to a 20 MMT drop in ending stocks to around 160 to 170 MMT. To put this in perspective---largest world ending stocks since 2003. Another way to view this, the large carryout stocks of US wheat alone could EASILY absorb the first 16 myn mt (587 myn bu) of crop losses. It would merely reduce our carryouts from over 1 byn bu to more normal 505 myn bu or stox to use of about 25%. The cash bids realize this, and that is one of the reasons we are seeing basis numbers getting hacked. A demand driven market (with strong basis) is much more fun. Remember the 50myn mt number. Remember that on 7/9 USDA already took world stocks down 6 myn mt, and best guess today is that we could end up with world stocks down 20 myn mt.

Overnight SK passed on corn (account of px). They do this occasionally, but always return. When they come back they don’t generally book MORE corn to make up for this passed tender. India’s monsoon has stalled and there is talk that it might not recover to full strength. The key is did it rain in the Ag important regions, or did they get missed?

HAVE A GREAT WEEKEND and SAFE HARVEST!!!

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG MARKET REPORT

PGG Country — Fri, 16 Jul 2010 02:31:06 -0700

Morrow County Grain Growers Pendleton Grain Growers

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

1-800-452-7396 or 541-989-8221 1-800-422-7611 or 541-276-7611

or Dan Steiner 481-6614 (office), 571-3798 (cell) graingrowers@centurytel.net

GOOD MORNING!!!

Below are the best indicated market bids as of: 9:00 on 7/ 15 / 10

	SWW	SRW	DNS		HRW		Barley	Corn
Month	Portland	*Chicago*	Portland	Basis	Portland	Basis	Portland	Cash Px
July	5		6.79	??	5.83	??	120	154
August	5		6.84	.80?	5.88	*-.12?*	120
September	5.05	*5.90 CUW*	6.94	*.90*	5.95	*-.05*	120
October	5.10		7.00	*.95*	6.11	*-.05*		153
November	5.20		7.15	*1.00*	6.16	*0.0*		154
December	5.30	*6.17 CZW*	7.20	*1.05*				155
January		*6.36 CHW*
N/C 2011		*6.59 CUW*	*7.27*	*.50*	*6.50*	*.20 KUW*		2011/ 160
N/C 2012		*6.88 CUW*						2012/ 160
**Club premium: Buyers Call!			*Prem/Disc*	*+25/ -30*	*Prem/ Disc*	*+10/ -25*	*Canola:*	*.162/ lb*

***NOTE: Corn values vary depending on delivery location PLEASE call for updates.

WOW! Futures are smokin’ hot this morning! At one point nearby wheat futures were up .38! Basis levels are just getting crushed all over the board. We have ?? for the nearby red wheat bids, what the exporters are really trying to say is CALL before you book. Very uncertain times indeed. Specs have total control of this market and no worries of convergence or deliveries for another 5 weeks. The way they are bidding the futures up, you would think we are nearly out of grain.

Sales reports were steady once again. It will be interesting to see how the rally impacts the end users, it is hard to imagine that they will rush out and increase purchases. Corn sales only tallied 39 myn bu. So much #3 corn has been finding its way to the Gulf that exporters have doubled the discounts for #3’s. As in the last few weeks the sales numbers aren’t the problem with corn, it’s the actual shipment, and with 7 weeks left in the corn marketing year, today it looks like we miss the export shipments by about 100+ myn bu. Wheat sales were mediocre at 11.3 myn bu: 3.1 DNS, 6.4 HRW, .3 SRW and only 1.4 SWW. The futures rally has tugged cash bids along, and again, it will be interesting to watch the sales numbers. The weaker $ and ocean freight will be beneficial.

Market is ‘ABUZZ’ about weather concerns. In Europe the hot/ dry hit the last week going into maturity. Today Strategie Grains (Europes version of USDA) has trimmed wheat production by 2.8%...and projected 129.5 myn mt of wheat this year vs. last years 129.8. Shoot we can lose 2.8% on a hot weekend in May! India’s monsoon has been a bit lighter the last week. No damage or harm to Ag, but it is getting ‘above the fold’ attention…they are also running at 10.6% inflation.

How much higher can we go? Who knows? The thing to remember is that this is a spec driven rally, not a fundamental or demand driven one. At some point gravity will kick in, but I have no idea if that happens tomorrow or 3 weeks from now. It’s markets like these that seem to emphasize the need for a market plan. Margin calls will be big, and cost to maintain HTA’s will increase. Brings to mind some of the trading rules I have posted above my desk…like #18. When the market is wrong, it doesn’t pay to be right. #16 pigs won’t eat $4 corn or $400 meal.

***Didja Know: US foreclosures are up 8% this year (could be more than 1 myn units this year). Nevada leads the way with 1:17 being foreclosed vs. the national average of 1:78.

***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes only***

PGG Market Report

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

Cash Px

August

September

December

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N/C 2011

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

Cash Px

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N/C 2011

PGG MARKET REPORT

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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July

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November

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N/C 2011

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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N/C 2011

PGG MARKET REPORT

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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November

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January

N/C 2011

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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N/C 2011

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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November

December

January

N/C 2011

PGG MARKET REPORT

Duane Disque or Brian Peiler Jon Sperl or Bryce Olson

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August