AgriVisor Morning MarketWatch

Tuesday, May 24, 2016
***** Corn down 1 to 3 cents; soybeans off 14 to 16; Chicago wheat lower by 3 to 3 1/2. ***** 

   # Soybeans face follow-through selling overnight and the weakness is spilling over into corn and wheat.  Fresh news is limited for the grains, so it is mostly a technical trade.
   # July soybeans have dipped below their 20-day moving average.  The contract has not settled under the mark since March 3rd.  Soybean futures still trade within the range opened on report day, May 10.  
   # Soyoil was only fractionally lower overnight while meal futures took the brunt of selling pressure.  There may be some spread unwinding in store for the products over the remainder of the week.  While July meal futures are up 38.5 percent since April 1st, July soyoil is down 10 percent over that time.   
   # Planting progress was just a touch under the anticipated mark at 86 percent for corn.  The five-year corn planting average is 85 percent through the third week of May.  The laggards remain Indiana and Ohio with corn plantings at 62 and 51 percent compared with averages of 77 and 66 percent, respectively. Emergence was 5 points ahead of the average pace at 60 percent. 
   # U.S. soybean plantings are pegged at 56 percent done, which is exactly on pace with last year and slightly ahead of the five-year average.  Illinois, Indiana are behind their respective five-year averages, but Iowa and Missouri are ahead of theirs.  Soybean emergence is rated at 22 percent.
   # Winter wheat crop ratings are unchanged from the previous two weeks at 62 percent good or excellent.  The crop was tagged 45 percent G/E last year.   
   # Australian meteorologists still have a ‘WATCH’ rating on La Nina.  In a report released on Tuesday, the Aussie government bureau stated that six of eight climate models point to a La Nina developing anytime from June to August.  
   # Meteorologists at the U.S. National Oceanic and Atmospheric Administration updated their La Nina predictions on Monday.  They give a slightly more than 50 percent chance that La Nina develops in the June/July/August timeframe.  A 75 percent chance is ascribed to the likelihood of La Nina being present by November.  
   # The economic report calendar is bare expect for a tally on new home sales.  There will not be a lack of news, though.  Traders are digesting comments to be made from the various Fed presidents throughout the week.  The debate over interest rate probabilities continues to lean dollar-friendly.  

***** Cattle futures expected to face pressure at the start; hogs should open steady to weaker.​ *****

   # The Cold Storage report showed weeks of high production leaving total pork stocks up on the month, bellies up on the year.  Pork supplies are no doubt in higher quantity coming into the summer season than what was anticipated a few months ago.  The meat now also has to compete with cheap beef for demand at the grocery counter.    
   # Chart traders will want to start out as settlers in the cattle market after futures gapped lower and finished limit-down on Monday.  The Cold Storage report had total pork stocks at 635 million pounds and slightly above the average trade guess, but the friendly number is expected to be shrugged off. Futures’ discount to cash should be the primary support influence.