Thursday, August 20, 2015 AgriVisor Morning Marketwatch

Thursday, August 20, 2015
***** Corn up 1 to 3 cents at the break; soybeans fractionally weaker; Chicago wheat moderately higher. *****

   Corn futures looking for a sixth straight higher close: Prices have been trending up ever so slightly since the report-day rout. The December contract is bumping up against resistance from the 20-day moving average overnight. Soybeans are on the defensive to start the day but have rebounded from overnight lows. 
   Another good round of ethanol data featured this week: Production was unchanged over the previous week and up slightly on the year. Corn grind was 101.3 million bushels and above the 98 bushels per week needed to meet the USDA's current 5.25 billion bushels target.
   Wednesday's action technically bearish for soybeans: The June low was taken out, leaving the $8.78 3/4 low from fall of 2009 to watched closely. The move lower since report day has left futures close to oversold territory. Volume increased slightly on Wednesday's tumble in bearish fashion. We will gauge the instensity of any follow-through selling today. 
   Export sales solid again this week: Old crop corn sales were a very strong 11.1 million bushels with commitments for 2105/16 running near the top end of expectations at 22.7 million. A small addition was made to the old crop soybean book as 28.8 million bushels were added to the new crop tally. Wheat sales were fully anticipated at 11.6 million bushels. 
   Equity traders convinced a September rate hike is in store: Minutes from the July Federal Reserve meeting depicted a central bank that was generally pleased with the country's economic performance of late. A 'risk-off' type trade is spreading across global markets with stock index futures down hard overnight. Chinese economy worries also persist to weigh on the broad financial space.

***** The meat pits were lower on Wednesday. Live cattle futures were sharply lower, with losses of 1.30 to 2.475. Lean hog futures were .10 to .40 lower. *****

    Cattle futures fell through key technical support on Wednesday and are headed for a test of the October contracts $143.30 July low. Cash cattle prices are expected to slip this week after a quiet trade last week leaves current showlist numbers high. Cattle on Feed data will give the trade more guidance on Friday. 
   Hogs were able to make a solid rebound on Wednesday after testing support from the major moving averages, a technically positive signal. Cash prices are weakening on a bearish outlook for supply growth, even despite the support received from strong retail demand.