AgriVisor Morning MarketWatch

Wednesday, December 30, 2015
***** Corn up 1; soybeans higher by 3 3/4 to 4 3/4 cents; Chicago wheat gaining 3.     ​*****
   # Grains are moderately higher ahead of the morning break despite a higher dollar and some broader weakness in rest of the commodity space.         
   # Chart traders will look to gauge the amount of follow-through from buyers after corn futures made a bullish reversal out of fresh contract low made intraday on Tuesday.  Monday’s $3.65 1/2 serves as minor technical resistance as Tuesday’s $3.57 low lends minor support.                                  
   # The weather forecasters are back and forth on just how much rain should be expected for northern Brazil over the next few weeks.  Soybean growers in Mato Grosso are likely to remain well short of ideal moisture levels.  Growers in the South are worried about too much rain and the spread of soybean rust.                 
   # Corn basis improved by a few cents throughout most of Illinois on Tuesday.  Elevators in southeastern Illinois are paying up to 10 cents over the nearby futures contract for current delivery.  
   # Argentina has now removed its export quota system for corn and wheat after having eliminated export taxes earlier in the month.  Still, quotas will likely be utilized with discretion of the new administration if necessary.   
   # Private forecasters are inching their estimates for Ukraine’s wheat crop back upward.  Recent rains across the region have helped improve conditions, but both Ukraine and Russia will face the constant threat of a winter that is trending colder than normal.   
   # U.S. crude futures are giving back nearly all of the gains made on Tuesday.  The February WTI contract trades within Tuesday’s range overnight and has the 10-day moving average under and 20-day over it on the chart.  The weekly energy stocks report will give the market some fundamental guidance later this morning.           
   # U.S. equities have gone the way of crude in recent sessions and stock index futures are thusly trading lower overnight.  Weakness in the so-called ‘commodity currencies’ has traders on edge over the health of emerging market economies.       

***** Cattle likely to continue lower as futures correct from their two week run; hogs look to start choppy and eventually take on a weaker bias. *****
   # Cattle bulls are likely to be content to take money off of the table after recent gains, squaring positions into the end of the calendar year. Buyers should be more comfortable with shifting fundamentals that include decelerating slaughters and a seasonal bottoming of demand.  
   # Spreading is the defining feature of the hog futures trade so far this week as volume otherwise trades lightly into the end of the year.  Cash and wholesale prices are resilient and recent supply data show that price gains can be expected by spring.