AgriVisor Afternoon MarketWatch

Tuesday, April 26, 2016
***** Corn finishes higher by 5 1/4 to 7 1/2 cents; soybeans up 11 /4 to 18 with relative strength in the front of the curve; Chicago wheat gains 8 1/2 to 10. *****

   # Hedge funds were net-buyers on the day.  The net-short corn position is now thought to be down to around 25-30,000 contracts.  Funds maintain a bullish soybean bet of around 125,000 contracts.  A hefty bear bet of around 
   # Preliminary data show corn and wheat open interest dropping to start the week as those hedge funds cover shorts.  Soybean volume and open interest continue to run near historical highs.  
   # Bullish speculators have offset pressure from increased farmer soybean selling in recent weeks.  Producers have been unloading beans as a hedge against their intended patience on new-crop corn sales.  
   # The Crop Progress report showed 30 percent of the U.S. corn crop planted with much more progress expected to have been made on Monday.  Storms brewing in the Southern Plains could reach the Midwest early Wednesday to force some planting delays.  
   # Australian meteorologists updated their El Nino/La Nina outlook.  El Nino is close to gone, while we are put on ‘La Nina WATCH.’ Seven of their eight climate models say conditions are likely ripe for a La Nina event starting in September.
   # South African authorities estimate their country’s corn crop will drop 3 million metric tons because of a drought caused by El Nino.  Relative to the country’s 7.05 mmt estimate, USDA is even more pessimistic with a 6.5 mmt prediction.     
   # A lower U.S. dollar helped support commodities today.  As interest rates are expected to remain low and the dollar weak as a result, some investors are choosing to funnel money into the commodity space as an effort to find returns.  Money flows into the commodity sector through the first quarter are near a five-year high.   
   # Crude futures were up sharply today as traders made bets ahead of the weekly inventory report.  U.S. stocks are expected to rise by 1.5 million barrels on the week.  The Energy Information Administration will release the numbers on Wednesday morning.  
   # Energy and metals/mining sectors propped up the stock market as tech and consumer service shares were a drag.  The durable goods index for March gained only 0.8 percent versus expectations of +1.9 percent.   

***** Live cattle settle higher by $1.25 to $1.85; feeders up $1.65 to $1.80; hogs down $0.15 to $0.62. *****

   # Sellers in the cash cattle market would be reluctant to offer good volume after last week’s tumble, but the board’s discount remains discouraging.  Oversold technicals provide some support to futures.             
   # Hog futures bounced off session lows after the midday cutout report produced higher pork prices.  Slaughters remain stubbornly high although weights promise to start moving lower.