AgriVisor Morning MarketWatch

Monday, January 04, 2016
***** Corn futures fractionally lower overnight; soybeans down a nickel ahead of the break; Chicago wheat off a penny. ***** 

   # Grains moderately weaker across the board.  Favorable forecasts for crop weather abroad weigh on prices.  Sentiment is also largely risk-off in major markets to start the new year.             
   # Global equity markets are down hard to start the new year.  A disappointing manufacturing report and a try-out for new circuit breakers (like grain market limits) caused a mini flash-crash in Chinese stocks.   
   # Oil prices are a touch higher overnight.  Traders are watching the market closely after a diplomatic spat this weekend between Iran and Saudi Arabia.     
   # Rain fell over the dry parts of Mato Grosso and northeast Brazil this weekend and contributes to the U.S. soy market weakness on Monday morning.           
   # The CFTC’s Commitments of Traders report has been delayed until today due last week’s holiday.  Fund traders still hold sizable net-shorts on corn, soybeans, and wheat.      
   # The technicals lean bearish for corn and soybeans to start of the week/year.  March corn is on a sharp downtrend and faces a test of key support at the $3.57 contract low. Soybean futures trade below all of the major moving averages and hover close to contract lows.  $8.47 is the mark to watch for March futures.   
   # Illinoisans are taking to cleaning up a large mess left behind by the flooded Illinois and Mississippi Rivers.  Water reached 56.1 feet this morning at the state’s southernmost city of Cairo, where the Ohio River meets the Mississippi.                 
   # Traders will digest some key economic data this week.  Reports on manufacturing, trade, and unemployment will be featured.           

***** Livestock futures likely to start softer as they start the new week/year off with pressures from outside markets.  ***** 

   # Traders will look to see how well packers can chew through abundant supplies of market-ready cattle after the Christmas and New Year’s holidays.  After jumping more than $10 on a live basis last week, cash markets are not likely to give futures guidance until they develop later in the week.    
   # Hogs ended the year on a mostly-positive note that was the result of friendly numbers from the quarterly supply report.  Analysts expect cash hog prices to build strength into spring and early summer before fall supplies become burdensome again.