PEARSON: This is Mark Pearson for Market Plus, part of our Market to Market Web page. Glad that you've joined us and Virgil Robinson, our analyst this week, Virg, good to have you with us. We talked a little bit about the bean market and people are kind of confused by it because there is not any carry in this soybean market, why hold? Why wait? Why buy it back?
ROBINSON: Well, I think people are bullish on price, Mark, given the supply situation and the prospects of that. But as we talked about earlier this evening there really is no carry in the cash market or in the futures market. Normally, lack of carry suggests the demand is front end loaded. So, it wouldn't be out of character in my opinion to go ahead and accommodate that demand by moving that inventory. But at least as we visit today, Mark, I'm still of the opinion price prospects are pretty bright between now and the availability of what is presumed to be record large production in the Southern Hemisphere.
I still can get, based on the technical work that I keep and feel confident in, I still can get a count of about 6.40. And a futures contract, whether it's January, March or May of 2003 I can't tell you which but I still get that kind of a count.
PEARSON: All right, so not getting in a hurry there are you. Let's talk about the hog market. Quarterly hogs and pigs report came out, we talked about it in the show. You were fairly well encouraged by that report.
ROBINSON: I thought there was some very positive pieces in the report, Mark. Before I continue I should however add there is a lot of frozen meat yet to be disposed of and yet to be consumed. We did, this week, kill again a couple of million hogs and 700,000 cattle. So, to suggest there's a shortage of meat would be very misleading, there is not.
But I think we did, in fact, document the idea that we have reduced the breeding herd and as a result of that fewer pigs are expected, Mark, in the next several months here. And that has lent support to those deferred futures and I think there will be some additional gain in those deferred futures.
However, given the aggregate of supply, red and poultry meat combined, and the prospects of what is forecast for the year of 2003, I don't think we can talk about a significant price rise quite yet. So, that mid to upper thirty dollar cash range I think is very likely given the supply and the kind of demand that we have, at least into the first six months of 2003.
PEARSON: A little bit better than this year.
ROBINSON:Yes, I think we'll average on--average something much better than this year Mark.
PEARSON: All right, Virgil, really appreciate it. That's Market Plus for this week. For Virgil Robinson and all of us at Market to Market, I'm Mark Pearson.