AgriVisor Morning MarketWatch

Monday, March 07, 2016
***** Corn up 2 to 2 3/4 cents at the break; soybeans higher by 5 to 6 1/2; Chicago wheat up 3 1/4 to 4 3/4. ***** 

   # Grains move higher on follow-through buying after a good close on the charts last week. Short-covering from the funds is partly credited for the early gains. Trading volume is starting off strong.  
   # Fund traders were shown by Friday’s CFTC report to be shorter than thought.  The large speculators had once again built a record net-short on the combined agricultural commodities.  Some short-covering was observed late last week after the bulls were successful in defending old corn and soybean lows.    
   # The monthly WASDE report will be issued on Wednesday.  Analysts look for old-crop ending stocks to rise by about 20 million bushels while their guesses average out to call for little change to the 450 million bushels of 2015/16 soybean carryout.  
   # Sunday’s fresh run of the National Weather Service model maintains an outlook for a warm couple of weeks.  The updated forecast leans wetter than it had been previously.  
   # Weather is mostly favorable for filling crops in South America and also conducive to harvest.  In Brazil, the soybean harvest is estimated to be just short of half done.    
   # Higher oil prices are giving the broad commodity space the potential to turn a bottom.  A related sense of restored confidence in the global economy has allowed iron ore and metals like copper to find their footing so far in 2016.     
   # The dollar trades higher against most major currencies overnight. The euro is under pressure as traders price in expectations for ECB action.  Brazil’s real is steady after a large move higher was made last week.     
   # U.S. stock index futures are down a touch overnight as uncertainty over what to expect out of this week’s ECB meeting offsets some added optimism over Chinese economy prospects and improved outlooks for emerging markets in general.        

***** Cattle and hog futures look to hold technical support and should enjoy spillover strength from outside markets at the start. ***** 

   # Cattle futures will look to the wholesale trade for some guidance early this week as buyers stand uncertain whether recent market gains are sustainable.  The most-active April live contract has failed to move through resistance from a December high but still trades with support from its major moving averages.     
   # April hog futures are consolidating on recent gains while the June contract features relative strength.  Thoughts of tighter summer supplies remain, but traders debate whether or not those bullish expectations are already fully baked into the market.