AgriVisor Morning MarketWatch

Friday, May 13, 2016
***** Corn down 3 cents at the break; soybeans off 9 3/4; Chicago wheat down 1 1/4 to 3 1/4.​ *****

   # Fresh news is limited for the grains. Bullish excitement from Tuesday’s crop report has faded and traders are left searching for other topics to talk about.  Back to weather it seems.  
   # Cold weather descends upon the Midwest over the next 5-7 days.  Frost and freeze is a threat to emerged corn in the North.  Corn and soybeans throughout the region will continue to suffer from a lack of growing degree days.  
   # Fund traders are paring some length from their bullish soybean bet.  A net-long of more than 200,000 contracts has been cut to something nearer to 180,000.  After yesterday’s rally, money managers are net-long corn by nearly 100,000 contracts.
   # July soybeans still trade within the 68-cent range opened on report day.  That day’s low of $10.23 1/2 will be watched closely by chartists.  Corn futures are working to establish support from the 200-day moving average.  Highs for the July at $3.95 1/4 and $4.07 1/4 serve as potential resistance.  
   # Wet weather delays for Argentina have the corn harvest just over 25 percent done compared to a more usual pace of 45 percent.  The much-maligned Argentine soybean crop is estimated to be about half cut compared to it normally being more than two thirds harvested.    
   # Workers at Argentina’s Rosario port plan to strike today.  Union representatives for port workers say the goal of the strike is to secure higher wages, which have been sticky even in the face of very high inflation.  There is no word on how long the strike might last.  
   # The Brazilian real currency is expected to strengthen now that a new government administration has taken the reins.  U.S. exporters would likely benefit if the currency continues to appreciate against the dollar.  
   # Thursday’s export sales report hangs over soybean futures at the end of the week.  Old-crop sales were 212,400 metric tons versus expectations of 350,000-500,000 tons.  Sales for 2016/17 really missed the mark, coming in at 6,900 tons versus and average trade guess near 400,000 contracts. 
   # U.S. retail sales for April were up 1.3 percent and better than the average trade guess of +0.8 percent.  Retail stocks have struggled this week in the face of a string of disappointing earnings report from the sector.       

***** Cattle and hog futures look to start with pressure from technical sellers.​ *****

   # Traders wait for the cash market to develop and give the futures some guidance.  Some strong $134 live was traded on Thursday, but not in great quantity.  Futures would find support from their discount to cash if that $134 level would hold today.         
   # Cash and wholesale values are holding up despite stubbornly high hog slaughters and help to support futures.  Further gains for futures will likely be met with technical selling.  June hogs have the contract’s lifetime high of $83.97 just overhead.