AgriVisor Morning MarketWatch

Tuesday, January 12, 2016
***** Corn, soybeans, wheat all fractionally changed ahead of the morning break.​ *****

   # Grains unchanged overnight.  Minimal gains for Chinese stocks help restore some stability to global equity and commodity markets.  Crude oil continues lower.       
   # Report day.  Analysts look for record quarterly stocks held of corn and soybeans, look for steady U.S. corn carryout and slightly higher soybean ending stocks, look for a fractionally smaller corn yield and a fractionally higher soybean yield, and look for about 150,000 fewer winter wheat acres this year.  
   # Fund traders will go into the report with a substantial bear bet on the grains, having amassed a record net-short position in corn, wheat, and beans as of last Tuesday’s end to the reporting week.  Eventual short-covering/profit-taking may lend some support to the market. 
   # Brazil’s Conab has lowered its estimate for the country’s soybean harvest by 400,000 metric tons to 102.1 mmt.  USDA’s December estimate called for a 100 mmt crop.  Conab raised its forecast for corn production to 82.3 mmt versus USDA’s 81.5.       # Palm oil traders have shrugged off a pair of friendly production and export numbers that was released on Monday, instead looking at a weak crude oil market as reason to sell the edible oil. U.S. soy oil futures have also fallen weaker in recent weeks but still maintain strength relative to bean prices.           
   # Snow fell across the Midwest on Monday night as part of what will be a cold two weeks in the region.  A polar vortex is expected to dip down from southern Canada into the northern Midwest during the next several days.
   # The giant aluminum maker Alcoa kicked off earnings season on Monday with a slightly disappointing fourth quarter report.  Lower aluminum prices were in part to blame for weaker than anticipated sales.  Stock traders no longer see Alcoa’s report as the bellwether it used to be, so will look on bigger reports ahead.          

***** Cattle and hogs look to hold technical support at the open. ***** 

   # Cattle futures turned lower to adjust to the correction made in the cash market last week.  The board may begin to find some support from expectations for cash to hold steady this week.      
   # The hog trade features bear spreading to start the week, with traders looking at some possible near-term supply disruptions along with a better outlook for spring prices.