Morning MarketWatch: Report-day bearishness still hanging over grains

Thursday, November 12, 2015
***** Corn down 2 to 2 1/2 cents overnight; soybeans off 3 to 3 1/2 Chicago wheat fractionally mixed. ​*****
   # Corn and soybeans drift moderately lower overnight.  Fresh news is limited and the report day bearishness still lingers. March corn futures become the contract with most open interest today.    
   # Grain professionals meet for an industry conference in Geneva this week.  The experts are discussing a variety of topics from to the possible end to the bear commodity market to the need for better hedge instruments in Ukraine.
   # The results of the latest Egyptian wheat tender were announced, with the top-importer choosing to purchase wheat from both Russia and France.  Unfavorable currency terms still make U.S. wheat uncompetitive on the world trade market.       
   # Chinese corn inventories have been the subject of several news reports lately.  First, the Chinese government announced policy measures intended to shrink the domestic stockpile.  Next, the USDA “found” an extra 19 million tons of Chinese corn and added it to the balance sheet. Both are a negative for U.S. corn trade prospects.  
   # Sugar prices continue to rally as fund traders amass a large bullish bet on the commodity.  Growers around the world have a lingering fear that El Nino will disrupt production.  Data earlier in the week also helped sustain recent strength when it reported a greater than anticipated shift in cane usage from sugar to ethanol.   
   # A large agricultural plantation company in Singapore has projected a 10 percent cut to palm oil production in 2016, citing El Nino as the likely difficulty for growers.               # December corn futures have for now avoided a settlement below the $357 1/2 low made on report day, August 12th.  The charts lean bearish from an intermediate term perspective, but some short-run indicators are starting to register the board as oversold.  
   # Crude futures are testing October lows to start the day.  Prices are on a several-session slide as data continue to show building inventories.  The weekly stocks report, delayed due to Veteran’s Day, will be released this morning.    
   # The dollar is firmer against most emerging market currencies overnight, including against the Brazilian real. U.S. stock futures are lower on Thursday morning as traders continue to price in uncertainty over interest rates.  Some worry about political troubles popping up again in Greece add some uneasiness to global finance markets.         

***** Livestock futures look to enjoy a steady/firmer start as the market begins to stabilize.  ***** 

   # Cattle futures rebounded on Wednesday after two days of limit-down action washed out a last round of liquidations.  Shorts are taking profits but may likely continue pressuring the market as long as cash and wholesale values remain on the defensive.     # A bounce from technically oversold territory allow hog futures a higher close on Wednesday.  Pork cutout values are holding up fairly well and lend the futures board some support going into the end of the week.