Agrivisor Afternoon Marketwatch

Friday, February 12, 2016
***** Corn futures ended 1-1 1/2 lower; soybeans mostly 1-2 lower; with Chicago wheat steady to 1 lower. *****

   # There wasn’t a lot of market specific news to impact the grains to end the week. The rebound in the Dollar seemed to be the biggest negative, but that was countered by strength in crude oil and equities.
   # Wheat had the only grain specific news of interest regarding the overnight Egyptian tender.  The trade wasn’t sure of the outcome given the uncertainty about their ergot limits.  The number of offers were down substantially, with the only one accepted coming from Romania for 60,000 tons.  They issued a new tender late Friday to be completed Saturday.  Egypt indicates Bunge has offered to replace the cargo Egypt rejected, but Bunge hasn’t commented on the situation. 
   # There continues to be an ongoing discussion about how fast the Pacific Ocean will slip to a La Nina, with some forecasters last week suggesting it will be too late to have much impact on the U.S. crop this summer.  But with the USDA Outlook Forum coming soon, and the end-of-March reports on the horizon, new crop influences are increasing.
   # AgRural reported Brazilian soybean harvest is 16% complete, slightly ahead of last year.  In Argentina, it appears processors have been able to procure most of the old-crop soybean inventories producers have had to sell.  Weakening product basis levels are starting to soften the same here in the U.S., helping undermine our crush margins. 
   # Brazilian harvest weather forecasts are generally good.  The daily outlook into next week is mostly for scattered showers.  Temps are expected to be normal/slightly above normal.  The outlook is much the same for Arg. with temps a little less warm.
   # The Dollar mostly tracked higher to end the week, but traders said most of the action was end of week short covering.  Global economic fears remains, with some currency analysts still thinking the Dollar is in a precarious position.   
   # Crude oil surged to end the week, but at this point, we’d only chalk it up as short covering.  It still ended $1.40 lower on the week.  But the east of the bounce suggests downside risk may be very small.

***** Live cattle ended $0.35 to $0.70 lower, feeder cattle were narrowly mixed, with hogs $0.82 to $0.12 higher. ***** 

   # Slippage in the wholesale beef market remains a drag on the cash cattle trade, pulling prices down to either side of $130 at week’s end.  Competing meat prices is one of the larger negatives.    
   # This week’s hog slaughter slightly topped last year’s potentially capping wholesale and live prices at week’s end.  Red meat demand and prices tend to be a little defensive during Lent.