AgriVisor Afternoon MarketWatch

Wednesday, July 13, 2016
***** Corn futures up 8 to 9 3/4 cents; soybeans higher by 18 to 20 1/2; Chicago wheat up 2. *****

   # Call it follow-through strength mixed with a touch of weather concern, grains rallied on the first session after the July WASDE report.  Corn futures were the day’s best performer percentage-wise with soybeans having settled about 12 cents off their intraday highs.  
   # Tuesday’s crop report reinvigorated the robust demand storyline.  Improved export goals come as a partial result of strong global feeding prospects for soymeal and a smaller corn crop harvested in Brazil.
   # A weather market now weighs strong conditions for the first half of the growing season against the potential for a turn to a hot, dry second half.  USDA analysts will likely have to see an adverse shift for the historically-good crop condition ratings if they are to be convinced that their current yield estimates should not rise.    
   # “Dome of Doom” was a phrase heard among the trade chatter today.  The most alarmist predictions have the last half of July running only a hair cooler than the same periods of 2011 and 2012 and with less precipitation.  
   # Much of the Midwest is still expected to enjoy showers over the next several days before high pressure develops over the region and conditions turn hot and dry.  
   # Another week, another strong ethanol report.  Production was up 2 percent on the week and utilized 105.4 million bushels of grain.  The corn grind target was reduced by 25 mbu to 5.225 billion on this week’s WASDE.     
   # Weekly export sales will be dissected after their release tomorrow morning.  Traders expect to see corn sales total 45 million bushels with just more than half of that added to the 2016/17 ledger.  Also just more than half of an expected 40 mbu of soybean sales should be booked for new-crop deliver.  New wheat sales are expected around 20 mbu.   
   # Technical traders are drawing the Fibonacci lines onto the December corn futures chart, finding that a move to $3.85 would complete a 38 percent retracement of the recent three-week slump.  A 50 percent retracement puts a target on $4.  
   # November soybeans made a strong technical close above its 20-day moving average but faces resistance from the top of the down-gap opened after the July 4th holiday weekend, at $11.36 1/2.
   # Oil futures were one the of few commodities not to enjoy gains for the day.  An early-session sell-off deepened after the weekly energy inventory report found crude stocks down as much as expected but gasoline and distillate stocks up much more than anticipated, a signal of weak demand.  

***** Live cattle settle higher by $1.12 to $2.55; feeders up $0.67 to $1.10; hogs finished fractionally changed. ***** 

   # Cattle futures made a technical bounce and were able to hold gains despite further weakness that developed in the wholesale market.  Buyers in the futures market have optimism that cash deals will do better than the current bids surfacing near $116, which even there would hold a premium to the board.  
   # August hog futures managed to hold slight gains but found un-sustained buyer interest above the contract’s 200-day moving average.  Higher pork prices helped limit interest from the sellers.  October futures inched lower on more bear spreading.