AgriVisor Morning MarketWatch

Friday, January 29, 2016
*****Good Morning!*****

   # Grains trade steady within tight overnight ranges.  Higher oil and equities keep the overall bearish attitude in check. 
   # A large soybean cancellation was news of the day on Thursday.  China is balking on a 395,000 metric ton purchase commitment.  Cancellations are not unheard of at this time of year, but the first big one of the season is always going to weigh on prices.
   # The export sales report was neutral overall this week.  New corn sales were solid but a bit light relative to expectations at 32 million bushels.  Soybean sales were fully anticipated at about 24 million bushels. Wheat sales were low as usual at 10 million.    
   # The Brazilian soybean harvest is underway.  Yield reports are biased lower in the early going, but the harvest season beginning still creates a bearish story line for the soy complex.  
   # Argentine wheat is headed for the world's top importer, Egypt.  It was also announced that Argentina would deliver some wheat into the South Korean market.  The new Argentine government's recent dismantling of grain export taxes has made definite impact on the world trade market.  
   # Oil found some strength after Russia indicated that it would be open to talking with OPEC about possible production cuts.  WTI crude futures have closed higher in 5 of the last 6 trading sessions. 
   # March corn futures lost technical support from the contract's 5-day moving average while nearby soybeans fell below their 100-day on Thursday.  
   # A winter storm is expected to develop in the Plains late this weekend.  Snow and ice could be an issue for transportation in the Midwest by Tuesday/Wednesday.  

***** Cattle should start slightly higher; lean hogs steady/firm. ***** 
   # Traders need to see how the cash cattle market develops before they take a strong position on futures.  Late Thursday, the distance between bids and offers was large at around $132/$140 on a live basis.   
   # The fundamental picture remains bullish for hogs, but the recent run up in futures prices has left the board technically overbought.