AgriVisor Afternoon MarketWatch

Monday, February 01, 2016
***** Corn futures down a penny; soybeans off 1 1/2 to 2 1/2 cents; Chicago wheat lower by 4 to 5. *****

   # The day started with grains gripped by risk-off sentiment but were able to erase much of the early-session weakness by settlement time.  Outside market influence were mixed with lower oil partially offset by the weaker dollar.  
   # Export inspections were one of only a few bits of fresh fundamental news.  Corn shipments were fair at 27 million bushels, soybeans good at 42 million, and wheat OK at 10.  The Chinese soybean cancellation last week puts more importance on the Thursday sales report.  
   # Bearishness surround the wheat export market continues to weigh on prices in Chicago.  Last week’s uncertainty over Russian taxes didn’t help, nor did the announcement of Egypt’s rejection of a French cargo for phytosanitary concerns.    
   # Friday’s big dollar rally was followed up by a sizable fall for the index.  Traders are pricing in more divergence in world rate spreads after Japanese yields dropped to record lows and as the ECB debates further policy action.  
   # Price action was favorable late in the day for grains.  March corn settled above its 50-day moving average on an inside day and holds gap support from $3.64.  Soybeans finished in the top half of the day’s trade range and above the daily pivot but fell below the 100-day moving average.  
   # World weather news is currently a muted influence.  The Plains are bracing for a strong winter storm and temperatures are expected to drop considerably in the Midwest.  There remain some lingering concerns over dry conditions in South America, but no new developments to report.  El Nino continues to make for a dry Asia, with India being the subject of recent talk.  
   # U.S. equity markets reversed course after a weaker start.  Traders were dissecting comments from the Fed’s Vice Chairman that indicated the central bank could remain relatively dovish.  The market currently places low odds on a March interest rate hike.    
***** Live cattle up $0.42 to $1.15 as feeders make moderate gains; hogs down $0.10 to $0.50. ***** 

   # Cattle futures finished well off session lows and bucked some bearishness that had developed after Friday’s inventory report.  Boxed beef prices were mixed on the day as an undeveloped cash trade gave futures little guidance.   
   # Hogs slipped slightly lower as traders took profits on a technically-overbought set of charts. Cash trades were few and pork prices generally weaker on the day.