Pearson: I'm Mark Pearson, host of Market to Market and this is our Market Plus segment for our Market to Market Web site. Of course, our analyst this week, Virgil Robinson and Virgil, we were tlaking about livestock, we led with livestock which is something we don't do regularly but we've done a couple times here in the last month. This whole protein situation has become so confused between the Russian ban on U.S. poultry imports, backing those up, watching the hog market collapse, cattle market collapse, at least on the board cash seems to hang in there.
A lot of cattlement and a lot of pork producers out there, the few that are not in some kind of marketing arrangement are wondering just what's around the corner. The cattle and feed report we talked about on the show tonight, maybe we're turning a corner, maybe we'll get to start trading more just basic fundmentals?
Robinson: Mark, I think a couple of things, the composition of the futures market has clearly been altered by an aggressive phase of speculative participation and with good reason, the aformentioned problems you've talked about. Now, I do sense, this week was really the start of it, some short covering, some bottom fishing, if you will, in both of those futures markets. I was encouraged by that and there was some improvement particularly in hog futures.
Now having said that, Mark, the thing that I'm more concerned about tonight is the cold storage report that we eluded to briefly in the show. The cumulative red meat supply, as measured by taht report, is very close to a billion pounds in unison with more than a billion pounds of poultry. We clearly have a huge supply of edible proteins to dispose of. To that extent we need some help here. We need the retailer to pass on some of these recent savings that have developed or some of these recent price declines that have developed in the wholesale market to the consumer and move this product. Hopefully we'll see some of those retailers start to take advantage of this.
That began, I think, this week. Locally I saw instances of it as well as nationally. So, if that continues to move forward we have some reason here to believe there will be some spring recovery in both cattle and hog markets.
Pearson: Alright, quickly Virgil, over on the grains, talking tonight again we're going through one of those turbulent periods in agriculture with the situation in South America, the situation in the Middle East and the situation we had with Russia regarding trade. Quickly, your soybean outlook, disappearance has been strong. We've been eating up product and yet we seem to produce an awful lot of it. You're saying maybe get some priced here soon.
Robinson: Mark, I think U.S. farmers ahve done a good job with old crop soybeans, I really believe they have. Those that remain on farms as of March 1, about 250 or 260 million bushel, are in awfully strong hands. The basis has reacted to that, Mark, in their effort to try and source beans for crushing purposes, crush has improved here and our export pace, while it's slowed significantly, we still have a schedule at the gulf and regardless of how large or small you're got to source that product to fill that vessel to get it shippied out of here.
So, we have beans in relatively strong hands, my concern is, don't overplay this hand, for examply, carrying them too far into the summer. Mid July or there abouts I think old crop beans, Mark, regardless of price and objective need to be marketed. New crop beans, I wouldn't be against creating a floor around five dollars basis November beans.
Pearson: Alright. Get the scoop shovel and the broom out and get those beans cleaned out by July. Virgil, thank you so much, we apprectiate it. Virgil Robinson, our guest this week. That's Market Plus. I'm Mark Pearson for Market to Market.