Pearson: Welcome to the Market Plus segment here at our Market to Market Website. I'm Mark Pearson, with me this week one of our senior analysts Sue Martin. Sue, always great to have you with us. You've just been so negative on this cattle market and really you weren't talking a whole lot of improvement. We might see a bounce and maybe not take out $80 but for the cattle feeder it may be time to be taking some action if we get close to that. Alright, let's talk about the other side, this calf market. A lot of cow/calf producers, everything I'm hearing is mild winter, big calf crop this year. Any words of wisdom for the cow/calf person out there?
Martin: Well, the thing I think for the cow/calf person is that they have to realize that, I believe, that we are in a market that has topped and is done. The long-term bull markets that we have seen are over with and we're now heading into a declining or a negative toned market. So, they need to be more willing to price those calves out and move them out. They don't want to hang onto them. And, of course, God forbid, if we have a hot, dry summer that is just going to lean on their prices even more. So, I would suggest if they can get some priced out get them priced out on this next rally in the feeder market and that might help them out a little bit. The feeder market is, in my eyes, anything over $100 is too high priced at this time. That is not what the producer wants to hear. But I think it is. And I have a feeling that, you know, we got May feeders down under the $100 mark, went down to $98.15 and came flying out of there. And then we see-sawed a little bit. But this week, as we got towards the end of the week while the fat market softened feeders got stronger which is not uncommon. They've been doing that off and on all along. The feeder market is the one market I fear that could still get hit again. You had your fats do a fourth count technically on wave counts that we looked at where the feeders never did. They did meet a third count at $1, exceeded it and now they've moved back up. I look for resistance around the $103.50 but that's just a heart beat away. It may be that we take these feeders back up to $104.55 and then if they can take out $106.70 to $107.30, actually let's go to $107.30, now you could say maybe something better is going on but I don't think that's the case. You've got increasing interest rates, you've got a corn market that is extremely vulnerable to move higher in price. You've got a ton a meat around. And I think that all of those spell trouble for this feeder market.
Pearson: Alright, let's talk about the soybean market. We talked a lot about it on the show this week and primarily because there's been so much to talk about and the fact that a lot of people out there, you've been friendly to soybeans, a lot of people out there have been saying, you know, this is crazy, what is supporting this market? Huge carry out, huge crop in South America. You talked about it on the show, the South American crop is record but not what the market was anticipating 45 days ago.
Pearson: So, where is the soybean market going now? And producer thinking, what should we be doing?
Martin: Well, I think Mark, you know, as you know in the past I've been pretty adamant about $8 beans. And I think that we have a chance that we're heading towards that again. But this time when we start to move beans higher I don't think it's just a one year rally. I think we're into a multi-year rally. As we go towards, let's put it this way, as the Chinese go towards their Olympics in 2008 the demand for more protein, you know, steaks on the menu, pork, you know, and the world has 11% or so more pork around than they had a year ago. Poultry numbers are actually, believe it or not, higher than a year ago at this time. Of course, we were also seeing things go backwards a year ago at this time. Now, we've had some go backwards again but they've re-popped real quickly and China has already said that they're not as concerned about it any more. And it seems like we're not hearing as much rhetoric about it. So, things have settled down and at the end of the day that means more soy meal usage. Also, I think demand for biodiesel is growing and that is going to help the market out as well for soybean oil. But at the end of the day when you look at the inflation that we're dealing with and the markets moving like the gold and the silver, sugar prices up near their highs, they haven't made new highs but I think sugar is going to go to 22, you know, that all rubs back off. You take beans down, so maybe they go another 30 cents down, boy the risk exposure could be just huge. If you were to hear of rumors of a fund, which we are hearing some rumoring of this, I don't know if it'll happen but we're hearing slight rumors, and I emphasize rumors, but what if there is an EFT, EFP that comes out on soybeans or has soybeans in it? That is going to turn that market in a heart beat and it's a market that has handed all this negative news and could break, what, 30 cents. That – it used to be you could do that in a day or a day and a half. This market is going down to reluctantly, it tells me everybody is short that wants to be there and all the news is in the market.
Pearson: Alright, Sue Martin, thank you so much. Sue Martin joining us this week on Market Plus and, of course, on Market to Market. For all of us here on Market to Market, I'm Mark Pearson. Have a great week.