Friday, August 28, 2015 AgriVisor Morning Marketwatch

Friday, August 28, 2015
***** Corn futures up 1 1/4 to 1 1/2 cent overnight; soybeans higher by 4 to 6; Chicago wheat fractionally firmer. *****

   Scattered showers possible early in the weekend: There is a chance that rain could fall in the Western Corn Belt Friday night and early Saturday. Coverage is not expected to extend very far into the Eastern Belt. Some talk of dryness in the East is a minor bullish influence for soybeans. 
   Open interest sliding lower in the corn market: The preliminary report from the CME Group has open interest falling 30,000 contracts on Thursday. Paired with a higher volume tally for the day, the data suggest Thursday's gains to be a result of short-covering. Open interest for soybeans increased slightly on Thursday as interest in the wheat market held flat. 
   Wheat struggling to keep up with corn overnight: Wheat was the worst performer of the grains on Thursday. A host of bearish production estimates were released for the major growers. Chicago wheat is also on the defensive as Egypt - the world's top-importer - attempts to pressure world trade prices. 
   Corn futures still consolidating on the charts: Prices have not yet tested the upper or lower bound of the range opened on report day. Corn contracts are struggling with technical resistance from their 20-day moving averages. Soybeans are facing minor resistance from their 10-day. September Chicago wheat is testing key support from the August low of $4.84.
   Stock futures down after the market's substantial two-day rally: The major equity indexes are still up for the week after a rocky start. The Chinese market looks to be calming as the government signals its willingness to intervene. The U.S. market will have some guidance today from U.S. bankers that are meeting this week at the annual Jackson Hole Economic Summit to discuss direction for Federal Reserve policy. 

***** Hogs look to open steady/higher as futures consolidate on recent gains; cattle markets likely to trade quietly ahead of cash market development. *****

   The technicals were leaning positive for hogs after the bullish reversal made on Monday, but the fundamentals just aren't there to give buyers much enthusiasm. The outlook for growing hog numbers and seasonal demand weakness limit upside potential in the near-run.
   Wholesale beef prices have remained stubbornly high, but the expectations for a setback in those prices still hang over the cattle market. Beef prices at the grocery store increased further last week and maintain a hefty premium over pork. Packers will take into account their outlook for beef prices when they negotiated cash cattle deals later today.