AgriVisor Afternoon MarketWatch

Wednesday, December 30, 2015
***** Corn futures down 3 1/2 cents; soybeans up 4 1/4 to 5 1/2; Chiacgo wheat down 5 1/2 to 6. ***** 

   # Corn and wheat fell flat after a strong showing on Tuesday.  Soyoil futures led soybeans higher while meal prices dropped.  Most other commodities were lower on the day.         
   # Dollar strength was a notable headwind for the grains on Wednesday.  The dollar was up only moderately against the majors, but was strongly higher against competing commodity currencies like the Brazilian real.      
   # The U.S. soy market continues to enjoy a boost from rising palm oil prices.  El Nino is to blame for dry conditions and subsequent cuts to output expectations for the top palm-producing countries, Malaysia and Indonesia.  
   # Dry weather in Brazil was major bull storyline two weeks ago before showers last week tempered some of the enthusiasm.  Hot, dry center-west and northeastern growing regions are again being talked about this week.  This month’s rainfall will fall up to 10 inches short of normal in some areas with only spotted showers expected to pop up before the end of the weekend.     
   # But for some localized flooding, growing conditions are mostly favorable in Argentina.  The country’s crop agency has recently upped its forecast for corn and soybean production, in part because of good early bean crop conditions and also because of corn acres gained as a result of the new government’s market reforms.         # Midwesterners are still threatened by heavy flooding along the Mississippi River and its feeder rivers. The Mississippi could crest near a record 50 feet in areas south of St. Louis by Friday morning.       
   # As crude prices go, so go U.S. stock markets lately.  Oil prices dropped on Tuesday as the weekly stocks report showed inventories rising by another 2.6 million barrels.    

***** Live cattle futures climb $1.50 as feeders rally $2.87 to $4.32 with relative strength in the front of the curve; hogs $0.27 lower to $0.60 higher. ***** 

   # Cattle futures rallied as cash buyers showed their hand with bids near $126, or $2 over last week’s market.  As of midday, choice beef cuts were up $2 and select $3.  The wholesale cuts are about 15 percent lower than they were a year ago.        
   # Hog futures were largely directionless on Wednesday with trade action mostly defined by bull spreading. After a two-week run, futures face a headwind from cash prices that aren’t keeping up.  Slaughters are trending lower at the year’s end as weights pick up.