Agrivisor Morning Marketwatch

Friday, October 09, 2015
   ***Good Morning***

***** Grains are slightly higher to start the day; soybeans up 2-4, corn up 2-3, and wheat up 3-4. *****

   # USDA report comes at 11 am central time. Bloomberg estimates for today’s USDA report: 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). 
   # CONAB was out with their first estimates of their 2016 crops today.  Of most importance might be their wheat estimate, with the crop having been hit by a frost 2-3 weeks ago.  Their first soybean estimate is 100-101.9 mmt, up 4-6%.  Corn production is forecast at 82.6-83.6 mmt, down 2.2-3.3%.  Planted area for both corn and soybeans is expected to be larger, especially for soybeans.  Corn yield is expected to be off slightly from last year, with soybean’s higher. The wheat yield was forecast to be as good as last year, along with the total crop.
   # Analysts are expecting ABARE to lower their forecast of the Australian wheat crop 1 mmt. to 24.3 mmt.   
   # Chinese wheat and corn markets got off to a soft start after the Golden Week holiday.  There’s some thought the lower govt. cash price this year is weakening enthusiasm for grains in China.  But, that’s more a domestic that world problem.  Still, Ukraine exports to China are expected to be down.
   # Palm oil prices in Malaysia are down, but mostly due to the firmer ringgit(their currency).  Next week’s palm oil output data is expected to hit a new record. Malaysia is the 2nd largest palm producer behind Indonesia.  Still, there seems to be more optimism in vegoils than other sectors in the oilseed complex.
   # From a key weather sector in Ukraine, there’s an ongoing discussion that up to 30% of the winter grain sowings may be lost because of the warm, dry conditions, and limited time before the crop normally goes into dormancy.    
   # In France, plantings are going well with 23% of the winter wheat crop said to be planted, ahead of last year’s 20% pace.
   # The Buenos Aires Grain Exchange expects Argentine corn plantings to fall as much as 20% this year.  So far, 19.8% of the crop has been planted, in the areas that plant crop early.
   # the warm conditions are expected to persist in the Midwest.  But the longer range outlooks show moisture probabilities rising in the Midwest, first in the eastern Corn Belt, then in the western Corn Belt and S. Plains.
   # In the Black Sea area, the early cold snap continues with some seeing a hard freeze.  There is some chance of rain in the far southern areas this week, but much of the region will remain dry.  Hot, dry conditions persist in Mato Grosso, and will persist next week following some light scattered showers over the weekend.  Showers continue in southern Brazilian states, helping newly planted crops, but hurting the wheat.  South Africa will remain hot, dry.  Eastern and Western Australia could see some weekend showers, but hot, dry conditions will return next week. 
   #The Dollar is moderately lower in the overnight trade, with the Fed minutes not showing any indication they will start to raise rates soon.  The Yen is weak against the Dollar though, with BOJ expected to ease monetary policy soon.  

***** Cattle should start slightly higher; lean hogs steady/firm. *****  

   # Wholesale beef is near steady, but the volume remains more robust this week.  Wholesale pork is higher, but this week’s volume is less robust.  Packers are making money slaughtering both.
   # Cash hogs should be steady.  Cattle have traded $4-$6 higher already this week, with some activity at $120.