AgriVisor Morning MarketWatch

Thursday, April 28, 2016
***** Corn up 1 to 4 1/4 at the break; soybeans down fractionally; Chicago wheat up 5 to 6. ​*****

   # Corn futures perked up immediately following the export report.  New sales for 2015/16 were a tremendous 2.16 million metric tons, or double the average trade guess.  Corn sales for the 2016/17 marketing year were also better than expected at 440,000 tons.  Old-crop soybean sales were on the light side, but new-crop sales of 720,400 tons were strong.   
   # Analysis of volume and open interest suggests that the large-scale speculative buying campaign may be coming to an end for now.  The bears have covered corn shorts but have not turned bullish.  Soy bulls are taking profits on longs but don’t want the risk of being short.  
   # Commodities should find some support today from a lower dollar.  There was little reaction to yesterday’s no-change interest rate announcement from the Fed, but a noted response is being made to today’s surprising no-change interest rate announcement from the Bank of Japan.
   # A couple of ‘inside days’ has corn futures consolidating under a down-trending 200-day moving average.  $3.78 is a mark to watch for the July contract as it coincides with Tuesday’s low and the March high.   
   # Heavy rains fell in the Northern Plains over a short period of time on Wednesday.  Showers could pop up throughout the northern Midwest this morning.  The 6-10 day outlook for leans drier than average for both the Plains and Midwest regions.   
   # Fresh estimates for Argentine soybean production will circulate over the next several weeks as harvest kicks off there.  Early yields are tough to read after flooding damaged parts of the crop through the first three weeks of April.  Most analysts are comfortable cutting at least 2 million metric tons from the USDA’s 59 mmt estimate released at the beginning of the month.  
   # Brazil’s real currency continues to hover near 6-month highs against the dollar as traders bet on improved economic prospects.  The Brazilian senate will decide early in May whether or not the parliament will move forward with the impeachment process for President Dilma Rousseff.  She faces much of the country’s blame over a severe recession that has gripped the economy.  
   # U.S. stock index futures are down hard overnight as they face pressure from lower shares in Europe and Asia.  Traders will get a look at 1st quarter U.S. GDP this morning.  Analysts expect to see it at a paltry 0.6 percent. 

***** Cattle futures look to start on the defensive as hogs capitalize on chart support. *****

   # Weak wholesale values continue to weigh on the cattle market.  Choice and select beef prices are respectively 16 and 17 percent lower than they were a year ago. Early bids in the cash trade suggest some price slippage again this week.           
   # A lower dollar would help hogs today, but the market can sometime struggle when stocks are down hard like they are this morning.  Technical buying may be featured after June futures settled above their 100-day moving average yesterday.