AgriVisor Morning MarketWatch

Tuesday, August 16, 2016
***** Corn futures up a penny at the break; soybeans higher by 1 3/4 to 4 1/2 cents; Chicago wheat steady to 3 1/4 lower. *****

   # Grains higher overnight on follow-through buying, mostly short-covering.  Fresh news is somewhat limited but traders still have some lingering influences from the August crop report to sort out.
   # Trading volume was relatively light for the grains on Monday. Open interest for corn futures was down 2,674 contracts, which would be in line with expectations that speculators were moving to cover some shorts.  
   # Fund traders are estimated net-short corn by about 125,000 contracts, remain net-long soybeans by 115,000, and hold a net wheat short near 125,000 contracts.            
   # Traders are keeping watch for additional export sales.  There was chatter of some weekend soybean deals made with China but no flash sale was announced on Monday.
   # Corn futures reached to new contract lows on Friday before reversing higher for a firmer close.  Overnight strength puts December corn above its 20-day moving average and closer to minor resistance from $3.46.
   # November soybeans have cleared $10 on their way for a test of the 100-day moving average, which currently drifts higher toward a 38 percent retracement target at $10.35.
   # Rains move further into the eastern Corn Belt today after heavy totals were collected in Illinois and Indiana on Monday.  The two-week weather forecast has turned markedly cooler.  Both the 6-10 and 8-14 day maps lean wetter for the Midwest.  
   # Dollar index futures were down sharply on dovish comments from U.S. central bankers regarding a loosened stance on the inflation target.  The dollar move is helping to support most commodities overnight.  

***** Cattle futures look to open steady/weaker; hogs steady/firmer.  *****  

   # Traders were seen taking profits on cattle futures as they entered the week with less optimism regarding cash market potential.  Slaughters are running slightly higher this week and buyers have some additional caution ahead of the Friday Cattle on Feed report.  
   # The market can be expected to turn before the fundamental data does and that may be what is going on in the hog market.  Futures have started higher and now the outlook for cash and wholesale prices is improving.