AgriVisor Morning MarketWatch

Thursday, December 31, 2015
***** Corn futures steady ahead of the break; soybeans down 2 cents; Chicago wheat fractionally firmer. ***** 

   # A very flat market with corn futures trading only a two cent range for most of the overnight session.  Traders await the weekly export sales report.           
   # It has been a relatively flat year for corn prices.  March futures opened 2015 at $3.96 1/4.  Nearby soybean futures started the year at $10.17.  Chicago futures will finish down by a little more than $1 in 2015.       
   # A friendly ethanol report failed to lend any support to corn futures on Wednesday.  Production of the fuel additive was up 2 percent on the week and used an estimated 104 million bushels of corn.  Corn use needs to average about 99 million bushels per week to meet the USDA’s current grind target for 2015/16.   
   # Corn and soybean crops are nearly all planted in Argentina.  Developing soybeans are in good shape for now, but the major growing regions are starting to run short of moisture.  The forecast has relief on the way over the next few weeks.         
   # Growers in South Africa are fighting a drought that looks to cut output from the country’s corn crop. USDA currently pegs South African corn production at 12 million metric tons (compared to U.S. at 347 mmt).  
   # Corn bulls didn’t take advantage of Tuesday’s bullish technical reversal and are left defending support from the March contract’s low at $3.57.  Soybeans are facing a test of resistance from 20- and 50-day moving averages today.           
   # A familiar story to close out the year as U.S. are tugged lower by weak oil.  After U.S. crude prices were halved in 2014, they were cut by another third in 2015.  General commodity market softness has been a partial result of global growth worries that also serve to weigh on U.S. equity prices.         

***** Live cattle futures open with a test of key technical resistance; nearby hogs will look to hold chart support. ***** 

   # Cattle futures rallied on Wednesday as cash buyers showed their hand with bids
near $126 before eventually paying $135.  Wholesale prices are mostly keeping up and help keep market sentiment positive.          
   # Unlike the cattle market, hogs suffer from a lack of clear directional sentiment.  Spreading and year-end positioning has guided the trade so far this week and will likely do the same on Thursday.