AgriVisor Morning Marketwatch

Monday, August 22, 2016
***** Grains are slightly lower to start the day; soybeans 3-4 lower, corn 2-3 lower, with wheat 6-8 lower. *****

   # Pro Farmer’s crop tour and the annual Jackson Hole meeting of world financial officials will likely dominate the market attention this week. 
   # Pro Farmer’s tour starts today in the eastern and western Corn Belt.  There will be some state numbers for the far western and eastern states they cover tonight.  But the bulk of the numbers for the bigger production states don’t start to flow to the trade until Wednesday evening, with Iowa and Minn numbers not available until Thursday evening.  The key data everyone is going to be looking at is related to ear size; kernel rows and ear length. You can follow comments from the tour on twitter with #pftour16.
   # The Fed Reserve hosts their economic symposium in Jackson Hole this week.  The highlight is expected to be Fed Chairman Yellen’s speech on Friday, one analysts are hoping she’ll tip her hat on her leanings regarding financial policy.  She’s increasingly being seen as the “tie breaker,” the key person to finally tipping the policy to raising rates.
   # Crop conditions will be noted this afternoon, with the trade thinking corn/soy could see the good excellent number drop 1 points.  But, we don’t believe they’d be shocked by steady either.  In either case, the crop tour rumblings will overshadow these numbers this week. 
   # Export activity won’t be ignored with traders watching the Monday shipments with the more robust pace over the last 4-6 weeks.
   # Of the 3 grains, wheat is the one the trade continues to be most negative about because of the steady rise in the Russian crop size.  They’ve harvested 53 mmt. to date, with the yield up 12% from last year.  Ukraine’s crop is better as well.  The Russian farm ministry is proposing a 0% export tax for this year. 
   # The steady rise in the Real and the lower prices of soybeans has  significantly reduced Brazilian sales.  Producers only priced 2% of the crop last month and are thought to be 85% sold.  It’s thought they’ve only priced 20% of the new crop, compared to 26% at this time last year. Meanwhile, Arg. farmers are starting new-crop sales ahead of last year.  1.16 mmt. is thought to have been price compared to none at this time last year. 
   # At the end of last week, Arg. Agr. Ministry reduced wheat plantings to 5.19 mln. hect. from their prior forecast, but that is still 18.8% over last year. Planting is 97% complete. Soybean harvest is finally coming to an end. 
   # Managed money increased their corn short position slightly.  They liquidated a part of their long soybean position, but are still long over 11,000 contracts.  They also liquidated part of their wheat shorts, but are still short 105,000 contract. 
   # European milling wheat is starting the week slightly lower, but that fits with the receding focus on the impact of this year’s flooding.
   # Weather has receded somewhat from the focus.  This week will be good across the middle of the U.S. with the milder temps and middle/late week weather system.  Longer range forecasts are shifting toward normal/warm temps, especially toward the east, with moisture retreating toward normal.
   # Other than the Fed symposium, economists will be looking ahead to Friday’s new GDP data.  They will also note Japanese inflation data this week, and new data on the eurozone business activity.
***** Cattle should start slightly lower; lean hogs mixed/lower. *****​
   # Wholesale beef was slightly lower at the end of last week.  Friday’s COF was slightly negative.  Still, cash cattle prices are thought to have ownership interest near $115. 
   # Wholesale pork was slightly higher.  Cash hog prices could be a little defensive with larger seasonal supplies, but packers are making good money slaughtering hogs.