Friday, August 7, 2015 AgriVisor Afternoon Marketwatch

Friday, August 07, 2015
***** Corn climbs 3 to 3 1/4 cents on the day; soybeans jump 20; Chicago wheat closes higher by 3 1/2 to 5. *****

   Corn futures hold on to a 1 3/4 cent gain for the first week of August. Soybeans gain 28 1/4 in the nearby August as the most-active November contract rises by 23. Chicago wheat futures strengthened by 11 1/4 over the five sessions. 
   It is a wide range of trade estimates that we have going into next week's report. The Reuters survey has analysts looking for the corn crop to come in anywhere from 13 to 13.76 billion bushels versus the USDA's July estimate of 13.53. The range for U.S. soybean output is 3.57 to 3.8, entirely below the USDA's current 3.885 billion bushels. 
   Traders were talking about the fact that heat is taking a toll on the European corn crop. Just 58 percent of the French corn crop is rated good or excellent. High temperatures are expected to persist through the month and are now spreading into Russia. The region's wheat crop has been able to escape the season without considerable damage. 
   Stocks were hit after the monthly unemployment report had traders thinking a September interest rate increase is imminent. Nonfarm payroll additions were exactly as expected at 215,000 and the unemployment rate was unchanged at 5.3 percent. Wages remain weak but the Fed is likely to be pleased enough with progress in the labor market. Low inflation is still a worry for the central bank.
   Dollar index futures were shaping up to have a bearish outside day. The U.S. currency started higher against most of its peers on the unemployment data but lost steam by midday. After peaking at 100 in March, the spot index has dipped lower but still remains as strong as it has been since 2003. A firm dollar has been the primary headwind for commodity prices since it began turning up last summer. 

***** October hogs down moderately on the day and $1 on the week; live cattle futures lose fractionally as feeders drop $0.925 to $1.40. *****

   Cattle futures traded very tight ranges for most of the session. The board has made a quick rebound after bottoming in late July with strength had on the idea that cash prices can improve into the end of the summer. That the 100-day moving average is overtaking the 50-day is a bearish technical development to watch. 
   Hogs futures were lower but held up somewhat well against a sharp tumble in the direct market. The morning USDA report had cash hogs falling $5.70 in the Western Corn Belt trading region. All the while, carcass prices were up by more than $1.