AgriVisor Morning MarketWatch

Friday, May 20, 2016
***** Corn up 1 to 3 cents; soybeans up 5 1/2 to 11 3/4; Chicago wheat up 2 to 3. ***** 

   # Grains trade moderately higher overnight on limited fresh news.  Yesterday’s slide found volume and open interest both up slightly.  Today’s focus turns to weekend weather forecasts.  
   # Outside markets are not starting out as the negative influence they were on Thursday.  The dollar is steady against most currencies overnight and does not place the same broad pressure on the commodity space as it had during its early-week rally. 
   # The weekend forecast is mostly dry for the major soybean growing areas of Argentina.  The country’s soybean harvest is estimated at 61 percent complete with 28 percent of the corn crop put away.  Farmers there are dealing with yield and quality loss, particularly for the soybeans.
   # Brazil’s second crop corn harvest is in its infant stage.  Hot, dry weather will be conducive to a rapid harvest start but will not have boded well for yield potential.
   # Farmers in southern Illinois are hoping they avoid rains that are forecasted for them today; same for Indiana and Ohio.  Another active weather pattern is expected for the Midwest next week.
   # This afternoon’s CFTC report should show that fund traders had built a net-long soybean position that meets or exceeds the 2012 record.  Money managers are thought to be currently maintaining a net soybean long of about 200,000 contracts, net corn long of near 50,000 contracts, and net wheat short of almost 100,000 contracts.  
   # July corn futures are now up against technical resistance from an old highs at $3.95 1/4, 4.00 1/2, and $4.07 1/4.  Thursday’s $3.85 1/2 low and the 200-day moving averages are levels of potential support.
   # Economic news today is limited to a report on home sales.  Up next for a key report is the June 3rd unemployment report, which could go a long way in helping the Federal Reserve decide what will be done with interest rates upon their next FOMC meeting.         

***** Livestock futures look to attempt a rebound at the start.​ *****

   # Cattle traders are going to want to approach the futures market with some caution ahead of this afternoon’s Cattle on Feed report.  Total on-feed should be something very close to last year’s number, with placements down a touch, marketings up.         
   # High production and competition from beef leave the outlook for hog prices less optimistic as the summer grilling season is about to kick off.  Thursday’s export sales report included a poor pork number just when bulls were starting to get excited about the possibility of strong trade demand from China.