Thursday August 27, 2015 AgriVisor Morning MarketWatching

Thursday, August 27, 2015
***** Corn futures up 1 1/2 cent overnight; soybeans gain 13 1/4; Chicago wheat reverses night session strength to rest fractionally lower at the break. *****

   Grains rebound ahead of the weekly export sales report: It's back to the internal market fundamentals for the grains, at least for now. Traders were taking profits on short positions and waiting to evaluate the export numbers.
   Export sales mostly bullish: The net-reduction to the corn book, in the order of 5 million bushels, was disappointing. New crop sales of 38.8 million bushels were well above expectations. A similar net-reduction was made to the 2014/15 soybean sales tally to help push 2015/16 sales to 53.6 million bushels. The top end of the trade guess for new crop soybeans was 33 million. Wheat sales were strong for a change at 19.4 million bushels. 
   Weather forecasts favorable for crop production, negative for crop prices: Chances are for the Corn Belt to stay dry in the upcoming week before rain falls near the end of the two week outlook. Temperatures are expected to warm considerably over the next few weeks. No major weather issues are currently being talked about for growers abroad.
   Outlook for U.S. wheat exports becoming even more dismal: Europe is wrapping up harvest, finding that wheat as largely escaped unscathed the extremely hot/dry conditions that were faced over the past few months. Top importers like Algeria and Iran are expecting strong domestic production this year. Australia is projected to harvest a big crop despite early-season worries about El Nino. 
   Outside markets lean supportive for the grains: WTI crude oil futures are rallying nearly four percent on short-covering that has been triggered by improved global economy sentiment. The Chinese government is rumored to have a plan in place to raise dollars and support their yuan. Dow futures are up overnight after the index posted big gains on Wednesday.

***** Hogs look to open steady/higher; cattle futures likely to stage a bounce from technically oversold territory. *****

   Hog futures still enjoy technical momentum earned earlier in the week, but Tuesday's intraday highs and the 100-day moving averages stand overhead as resistance. The bulls will have to shore up some confidence after the cutout values dropped hard on Wednesday, though.
   Wholesale values are still strong relative to expectations that have developed over the past several weeks. Today's direction for boxed beef will help establish the market for Friday's cash trade. Bids and offers currently range $144 to $150 live.