Tuesday, September 8, 2015 AgriVisor Afternoon Marketwatch

Tuesday, September 08, 2015

***** Corn finished 5 higher; soybeans finished 12-13 higher, with Chi. wheat 6-7 higher. *****

  •    Financial, forex, energy markets had more of a positive bias to start the week, lifting some of the weight from grains.
  •    Bloomberg released their USDA report expectations.  The trade is looking for a 2.3 bu. drop in the corn yield and a 200 mln. bu. smaller production.  The soybean yield is 0.8 bu. lower, with a crop 75 mln. bu. smaller.  Ending stocks were tightened too, just not as much as the production reductions.  Interestingly, the trade seemed to ignore the Informa numbers.
  •    Weekly crop ratings were unchanged, 68% good/excellent for corn and 63% for soybeans.  Interestingly, the progress remains ahead of last year for both corn and soybeans, with soybeans even slightly ahead of average, implying a shorter time for kernel/seed fill.
  •    Export inspections were neutral negative, 35.2 mln. bu. for corn, 3.4 mln. for soybeans, and 13.6 mln. for wheat, with the wheat number likely to be taken most negatively.   On the daily system, USDA reported 2 cargoes of soybeans were sold to unknown and 2 cargoes of corn to Mexico.
  •    There was some talk about the weekly commitment of traders numbers, especially for wheat where managed funds were said to be slightly short all three markets, Chi., K.C., and Minn.
  •    China’s Aug. soybean imports, 7.78 mmt. were higher than the trade expected to see, but the Sept. number may be the one they are most interested in.  It is usually the low of the season, and may offer a good benchmark for what is ahead. The primary Chinese think tank cut their corn forecast 3 mm.t to 229 mmt. That’s still 6% higher than last year.
  •    ABARE(Australian USDA) raised their wheat forecast to 25.28 mmt. from 23.6 mmt. because of good weather.  El Nino has not brought the characteristic drought to that country. 
  •    FC Stone was the first to forecast a 100 mmt. soybean crop for Brazil next year.  CONAB won’t issue their first forecast until October.

***** Lean hog futures ended $0.35 to $0.67 higher; live cattle futures were mostly $3.00 higher; feeders ended $3.12-$3.90 higher.  *****

  •    Cattle traders were more optimistic for beef demand with the lower prices.  There was no cash trade, but it is expected to be firmer this week.
  •    Wholesale pork held firm, offering some support to hog prices, but the cash hog trade was only slightly higher.  Cattle/hog spreading may have helped cap lean hog futures strength.