AgriVisor Morning MarketWatch

Friday, May 27, 2016
***** Corn down fractionally at the break; July soybeans down 1/4, November up 2; Chicago wheat down a penny. *****

   # Grains trade quietly overnight.  It is expected that some traders may look to take profit ahead of the long holiday weekend.  Markets are closed for Memorial Day on Monday.
   # The pre-holiday trade should expected to feature lighter trading volume.  Thursday’s volume was larger than average for corn while open interest slipped by 1,404 contracts.  A decline in wheat open interest helped confirm that short-covering was a fuel for that rally.  
   # Grain futures were higher at China’s Dalian Grain Exchange on Friday.  Prices gained despite the government being in the middle of an auction day.  A large chunk of the day’s sales was made in the North at $228 per ton.   
   # Farmers in Argentina have put off the corn harvest while they work to harvest a soybean crop that is, for many, of poor quality and low yielding.  Soybean harvest is estimated to be nearly 75 percent complete while just under a third of the corn crop is put away.  
   # As expected, rainfall totals were lower in the East than they were in the West of the Corn Belt this week.  Farmers in Indiana and Ohio were able to make some catch up on plantings.  Progress through this weekend should amount to 95 percent complete for the country’s corn crop, 75 percent for soybeans.
   # The forecast has the holiday weekend leaning wet.  Chances for severe weather continue to run higher in the Central Plains.  The two-week maps have temperatures turning cooler while calling for above-normal precipitation for the southern Midwest.     
   # The dollar index trades moderately higher this morning as traders wait to hear from Fed Chair Yellen later this afternoon.  Currency traders, along with their counterparts in most other markets, will not want to take off early for the holiday.  

***** Cattle futures start with a test of technical resistance; hogs look to open steady/higher. ​*****

   # Cattle futures look poised for further rebound.  With a larger showlist, the South featured some cash trading earlier in the week.  Deals were made at $125 live, down $6 on the previous week.  A cash premium over June futures and an even greater premium over August lend support to the curve.            
   # Hog futures will have trouble sustaining the early-week strength if wholesale prices are going to turn back lower.  Pork production looks to have turned the corner, but smaller supplies may not be enough to counteract the seasonal tendency for the market to peak this month or next.