AgriVisor Morning MarketWatch

Wednesday, June 01, 2016
***** Corn down 2 to 3 cents just ahead of the morning break; soybeans off 4 3/4 to 6; Chicago wheat up 1 1/2 to 2. *****

   # Corn and soybean future face slight pressure from planting progress numbers that came in near the high side of expectations.  Corn was estimated to be 94 percent planted as of Sunday, soybeans 73 percent.  Indiana remains the laggard on planting pace.  78 percent of the nation’s corn crop has emerged compared with 81 percent last year and a five-year average of 75 percent.
   # End-of-month profit-taking was evident in the corn market on Tuesday.  Corn open interest dropped 18,000 contracts.  Short-sellers added to their bearish wheat bet on a day when open interest for that commodity rose by 10,000 contracts.    
   # A favorable weather outlook for early in the growing season is being weighed against the potential for La Nina to threaten production potential late.  Experts suggest that La Nina would bring with it an increased chance of hurricanes along the Atlantic Seaboard to add to the headache of possible drought in the Midwest.    
   # Palm oil prices rose in the Malaysian market on Wednesday.  Traders are still bullish after drought cut production this season, but they are less friendly now that El Nino is gone and output levels can start to rebuild.  There are also ideas of weaker Chinese demand starting to pop up.  
   # Corn futures were lower, soybeans higher on China’s Dalian exchange Wednesday.  There has been some uncertainty at the start of the week for Chinese soy traders after it was announced that the government’s reserve auction would be delayed.
   # The Central Plains gets a chance to dry out today.  Wet weather in the Eastern Corn Belt may stick around for a couple of days.  Farmers in southern Missouri and east through Kentucky hope a drier two-week forecast holds true.    
   # More talk of expectations for the June 30th Acres report will come soon.  Early guesses have corn acres dropping 250,000 to 1.5 million acres from the 93.6 million estimated by the USDA in March.  Some analysts have soybean acres rising by 1 to 2 million.  
   # The dollar index is down as a result of a sharp move for the yen. The Japanese prime minister announced that much talked-about sales tax increase will be delayed by two years.    

***** Cattle futures look to benefit from follow-through buying at the start; June hogs start the week with a test of resistance from the contract’s major moving averages. *****

   # Buyers like the idea that cattle slaughters should start to come down, but the sellers recognize that beef stocks still remain high.  Entering the summer grilling season with cutout values that are 10-15 percent lower than they were a year ago helps to improve prospects for demand.    
   # The outlook for pork demand is positive, but a sluggish cash market has yet to confirm that.  There is some worry that exports will not continue at a strong enough pace to help clear the domestic market of surplus inventory.