AgriVisor Afternoon MarketWatch

Wednesday, June 29, 2016
***** Corn down 10 to 12 1/2 cents; soybeans off 5 3/4 to 8 1/4; Chicago wheat down 10 1/2 to 14 1/4. *****

   # Follow-through selling in the corn and wheat markets was enough to spread a bearish tone into the soy trade. Trading volumes were light relative to the rest of an active June.   
   # Traders were pressing the sell button on corn while rain was falling across a wide swath of Iowa.  The system was moving into western Illinois late in the afternoon.  Wetter weather combines with a cooler forecast to keep corn on the defensive.  Soybeans hold up somewhat better as there remains worry that hot, dry conditions could return late in July.  
   # If weather would not have been the dominate market influence today, the grains could have found support from friendly action in outside markets.  Crude futures rebounded with the August WTI contract touching $50 again while equities rallied and the dollar dropped against its major pairings. 
   # Fallout from the Brexit vote still leave uncertainty over interest rate direction.  The European Central Bank will no doubt keep rates close to or in negative territory and may enact further stimulus measures, but questions will linger over whether or not the U.S. Fed will still raise rates in 2016 as previously planned.  
   # Traders shrugged off a solid ethanol report.  Ethanol production was up more than 4 percent on the week and utilized a corn grind of 105.3 million bushels.  Processors need to average 95.2 million bushels a week to meet the USDA’s current 5.25 billion bushel grind goal.
   # Export sales reports have been garnering special attention lately, but one before the June 30 crop reports may not provide as much guidance to the market.  Traders look for new corn sales to total 35 million bushels for 2015/16, 15 million for 2016/17.  Soybean sales should run 50 million bushels split about evenly between old and new crops.  Guesses for wheat sales range 10-20 million bushels.    
   # Deals are becoming fewer and being booked at cheaper levels after what was a more-active spring for world wheat exports.  The U.S. winter crop is coming online at a time when prospects for the European and Black Sea harvests continue to improve.       
***** Live cattle up $0.47 to the June’s $1.82; feeders rally $2.10 to $2.37; hogs steady to $0.65 lower. *****

   # More follow-through buying for cattle as live futures climbed toward the cash market and feeders benefitted from falling corn prices.  A rebound for boxed beef prices also helped the mood.       
   # Traders are still seen liquidating long hog bets after last Friday’s inventory counts came in higher than anticipated.  The 50-day moving average propped up the August futures contract at the end of the session.