Agrivisor Morning Marketwatch

Tuesday, October 06, 2015
   ***Good Morning***

***** Grains are lower to start the day; soybeans down 2-3, corn fractionally lower, and wheat fractionally lower. *****

   #The 42% soybean harvest progress was slightly higher than the trade expected to see.  Given the weather forecasts, it implies it’s going to rapidly move toward the finish.  Corn harvest was off a little at only 27% complete, with western areas lagging the most.  There was some talk of the slightly improvement in the soybean crop rating, but with harvest so advanced it has limited meaning.  
   #Winter wheat planting is lagging slightly at 49% complete.  It was 54% done last year and 51% on average.  Central/northern states are the most advanced, while the Southern Plains activity is a little behind normal.  Corn Belt planting is a little ahead.
   #Bloomberg reports the trade is looking for a 166.7 bu. corn yield(-0.8) and a 13.482 bln. bu. crop(-.103), a 47.2 bu. soybean yield(+0.1) and a 3.911 bln. bu. crop(-.016).
   #Bloomberg ending stocks estimates are 1.546 bln. bu. for corn(-.046), 428 mln. bu. of soybeans(-22), and 828 mln. bu. wheat(-47). 
   #China remains on their week long “Golden Week” holiday through Thursday.  
   #Weather forecasts are generally good, with both the 6-10 and 8-14 day outlooks calling for warm temps and mostly below normal precipitation across the Midwest. 
   #So far, the weather outlook for the Black Sea region remains mostly dry, with a chance of some light showers this week.  Temps are expected to turn colder, limiting growth before the crop hits dormancy.  Southern African areas are seeing a droughty pattern.  There is a chance of rain late this week in Mato Grosso, but for the most part, it still looks dry.  Early soybean planting is getting off to a slow start.  Some light showers could occur in Eastern Australia, but Western Australia will stay dry.
   #U.S. producers are generally storing the crop and holding off sales.  Basis levels are already strengthening in areas from Illinois east where harvest is starting to wind down.  Soybean basis levels may be the firmest with good crush markets and escalating export activity.
   #The Dollar is slipping lower on expectations the softer than expected jobs number Friday will delay the Fed’s expected increase in interest rates.  A private PMI for the U.S. economy was slightly lower for September, hinting growth may be stagnating.  U.S. trade data comes today.

***** Cattle should start slightly lower; lean hogs mixed/lower. *****
   #Wholesale beef is still softening, while wholesale pork is still rising.  Beef volume is picking up at the lower levels, while pork volume seems to be waning.  Cattle futures still haven’t offered a good sign the collapse has come to an end.  Meanwhile, pork prices are facing more competition from the collapse in beef prices. 
   #Cash hogs should be steady.  Cattle could trade higher this week.