Menu
 

AgriVisor Morning Marketwatch

 
Tuesday, August 23, 2016
   ***Good Morning***

***** Grains are slightly lower to start the day; soybeans 3-4 lower, corn 2-3 lower, with wheat 3-5 lower. *****

   # Both the weekly crop ratings and the Pro Farmer numbers seem to have put the markets on the defensive, although the Pro Farmer numbers for either end of the Corn Belt didn’t seem that negative.  The midweek weather system may be helping guide prices lower today as well, shoring up moisture as crops finish the growing season.
   # The weekly crop ratings were a little of a surprise.  The trade had expected the numbers to be steady/lower.  The USDA reported the corn rating 1 point to 75% good/excellent.  The soybean rating was unchanged at 72%.  Spring wheat harvest was reported to be 65% done, well ahead of average. Soybean podding remains ahead of normal at 89%.  Corn development is still ahead of normal with 85% in the dough stage, and 40% of the crop already denting.  35% is the average over the last 5 years.
   # Pro Farmer reported results of their tour through Ohio and S. Dakota fields.  Their Ohio corn yield, 148.96 bu. was no better than last year, and that was a moderately poor crop.  The S. Dakota yield, 149.78 was significantly lower than any of the last 3 years.  Ohio’s soybean pod count, 1055 pods over a 3sq. ft. area was well under the last 3 years.  Likewise, S. Dakotas, 970 pods was moderately under the last 3 years.  They should release their results for Indiana and Nebraska tonight.  The poor results of the first day were not unexpected. 
   # The wheat trade stayed on the defensive.  Yesterday’s Russian crop talk started to undermine prices yesterday.  Today, a private raised their forecast for the Ukraine crop 1 mmt. to 26 mmt.  The overall crop number was raised 1.7 mmt. to 62.7, with corn output revised higher too.
   # Expectations for large Canadian crop numbers are in the mix as well.  The wheat crop could be up 3 mmt. from last year at 30.4 mmt., with some looking for higher numbers. Canola output could be up as well, with estimates near 18.1 mmt. 
   # There continues to be talk about further upward revisions of old-crop soybean exports given the aggressive shipping pace.  Old crop carryout could be dropped another 25-30 mln. bu., tightening the new-crop structure with it.  
   # Europe had been plagued by wet weather earlier this year, with the talk now shifting to dry concern, for the corn crop in particular.  A private group cut their yield forecast from last month, but it still remains slightly higher than the average over the last 5 yrs.  Conditions in France are especially concerning to the analyst.   
   # There is talk in Brazil there’s a shortage of trucks to move fertilizer to the interior.  And because of that, freight rates to move fertilizer have risen dramatically.  It’s not clear the impact this will have on this year’s crops, but it certainly could be a drop on productivity. 
   # Weather has receded somewhat from the focus.  The midweek weather system is seen as a bit of a negative.  The longer range outlooks are showing temps moving back to normal/warmer than normal; in the east in particular.  And the above normal moisture is receding, except for the S. Plains. 
   # The Dollar is slipping slightly today on Fed rate hike doubts.  The trade is also waiting on Yellen’s speech on Friday. The German services PMI fell slightly, while the French manufacturing PMI did the same.  The French services PMI ticked up slightly as did the combined PMI for the eurozone. 

***** Cattle should start steady/firm; lean hogs mixed/lower. *****  

   # Wholesale beef was slightly higher Monday.  Friday’s COF was slightly negative.  Still, cash cattle prices are expected to attract buying interest in the middle/high one-teens. 
   # Wholesale pork was slightly higher.  Cash hog prices were steady, with packers willing to absorb supplies offered to them given the good margins.  This industry is starting to look ahead to Nat. Pork Month in October.

 

  SYMBOL IN EVEN SQUARE