AgriVisor Morning MarketWatch

Wednesday, July 06, 2016
***** Corn down 5 1/2 to 7 cents; soybeans off 21 1/4 to 25 1/4; Chicago wheat lower by 6. *****

   # More rain means more weakness for the grains overnight.  Corn futures are back to testing Tuesday’s lows while soybeans November soybeans head toward $10.50.  Outside markets look to be taking on a risk-off tone for another day.
   # Areas that did not receive rain over the holiday weekend did so overnight, including NE Iowa, N Illinois, and most of Wisconsin.  Storms currently moving through Midwest are expected to dissipate quickly before showers pop up again later in the afternoon.  Another rainy day is forecasted for the Corn Belt Thursday.    
   # Condition ratings for the U.S. corn crop held unchanged at a very high 75 percent Good or Excellent again this week.  A one-point improvement for Illinois to 72 percent G/E combined with a four-point jump to 67 percent G/E in Missouri to help offset a drop in ratings for Minnesota, Wisconsin, and Michigan.   
   # Soybean crop ratings declined from 72 to 70 percent G/E on deteriorating of conditions in the Northern Corn Belt.  The current 70 percent G/E rating compares with 63 percent G/E from this time last year.  Soybean blooming progress was pegged at 22 percent versus 17 last year, 16 for the average. 
   # The continuous chart has $3.18 1/4 next up as a low that could provide technical support to corn futures.  That low was put in on October 1st, 2014.  Corn futures spend brief time in the $2.90’s during late-2008 and late-2009.  Buyers are for now showing some interest in December corn at $3.50.  
   # Hedge funds were thought to be sellers of 25,000 corn contracts on Tuesday, a few more than that of soybeans.  Those traders are only now starting to pare down the soybean net- long, from what had hovered near 200,000 contracts for several weeks.   
   # A risk-off trade major financial markets follows growing concern over the health of the global economy.  Investors continue to flee from the pound and euro and move capital into the dollar and yen.  Gold prices are up nearly 10 percent since the Brexit vote as a sign of market uncertainty.  Bond yields are dropping as traders bet on global central banks having to enact additional stimulus measures.

***** Cattle futures look to open steady/firmer; hogs futures may start on the defensive but could find technical support quickly. ​*****

   # A choppy Tuesday for cattle futures probably foreshadows what the rest of the week will hold for traders in the market.  Growing production estimates encourage the bears while the bulls suggest multi-year price lows will spark demand.  
   # Hog futures are pressured by a slight turn in sentiment that has followed another brief period of higher production/softer demand.  The seasonal shift for production may be starting while pork is having to compete with beef to greater extent.