AgriVisor Morning MarketWatch

Friday, April 08, 2016
***** Corn unchanged at the break; soybeans up 2 cents; Chicago wheat up 3. *****

   # Traders in most major markets are taking on a bigger appetite for risk this morning.  Wheat is the best performer of the grains overnight.  Gains are significant in the energy sector.  U.S. stock futures point to a stronger start for the Dow and S&P.          
   # May corn trades overnight with technical support from its 10-day moving average.  The contract has just more than a nickel to go before it would test resistance from the report day high of $3.67 1/4.  Soybean futures have lost some technical momentum but the intermediate trend remains bullish.  The bulls are working to keep the curve supported by $9.
   # This week’s export sales report was friendly for corn and soybeans.  Corn exports are now on pace to meet the USDA’s 1.65 billion bushel target.  Soybean export continue to run strong but now face some pressure from a South American crop coming online.    
   # A weather forecast that earlier in the week had rain coming for wheat crops in the Plains is now less certain.  The 8-14 day outlook calls for the West to lean wetter while the East stays dry.    
   # Soil moisture is being replenished in Russia and Ukraine after significant recent rain events.  Much of Southeast Asia is still struggling with drought.  Dry weather in Brazil is helping harvest along while wet weather in Argentina is delaying harvest there. 
   # The April update to the Supply and Demand tables will come on Tuesday.  Analysts do not look for any significant adjustments to be made to U.S. carryout estimates for 2015/16.  Wheat carryout could rise after USDA found more wheat than anticipated on last week’s Grain Stocks report.   
   # There is a great deal of uncertainty over what to expect out of the USDA on South American production numbers next week.  Brazil’s crop agency came out yesterday with an estimate for the corn crop at 83.7 million metric tons versus the USDA’s current 84 mmt guess.  Some analysts are as high as 87 mmt for the crop.  USDA projected Brazil’s soybean crop at 100 mmt in March.      
   # Crude futures are rallying as traders become more optimistic about the chances of OPEC reaching a production freeze agreement when they meet on April 17th.     

***** Cattle futures look to start steady to firmer on their way for a test of technical resistance; hog futures should move higher on support from outside markets. *****

   # The cash cattle market developed earlier than usual this week and deals were booked at levels steady with last week.  Traders were betting on some additional slippage for cash prices because the wholesale market continued lower this week.      
   # April hog futures are down about 8 percent from their early-March high as traders have decided to take profits and sit out or move their bullish bets into the summer contracts.