AgriVisor Morning MarketWatch

Thursday, September 08, 2016
***** Corn futures up 1 1/2 to 2 cents ahead of the break; soybeans higher by 5 to 6; Chicago wheat up fractionally. *****

   # Rain fell over the Northern Corn Belt last night with the system splitting Illinois about evenly in half.  The heaviest totals of up to 4 inches were collected in east-central Iowa.  
   # The five-day precipitation forecast has southern Illinois receiving its share of rain while parts of Missouri could get up to 5 inches.  The two-week maps turned wetter on their Wednesday afternoon run, particularly for the Southern Corn Belt.  The government gives a 4 out of 5 confidence rating for its 6-10 day outlook.  
   # The outlook for U.S. wheat demand is improving slightly as estimates for crop sizes in Europe and Russia inch lower.  The United Nation’s Food and Agriculture Organization has released a smaller European Union export target while analysts expect that the USDA’s 30 million ton export estimate for Russia can come down slightly on the September 12 crop report.
   # The crop forecasters at Lanworth issued their take on U.S. corn yield, calling it 168.2 bushels per acre versus the USDA September number of 175.1.  Estimates from the rest of the analysts will be reported on the newswires today.
   # Thursday’s usual issue of the weekly export sales report will be pushed back to Friday due to the Labor Day holiday.  Optimism surrounding the fall trade programs for corn and soybeans has been notable as of late.  A weakening dollar is currently helping to improve U.S. export competiveness.
   # China’s August trade numbers were a touch disappointing with the month’s soybean imports down 1.4 percent on the year.  Still, January-to-August imports run 3.1 percent higher over the same period last year.   
   # The start of harvest in the Midwest is a headwind for corn basis, but low flat prices make the producer a reluctant seller at a time when exporters have commitments to fulfill.  The USDA’s Interior Iowa report has the state average corn basis at 43 cents under December futures.  The Central Illinois average is 22 1/2 under.  
   # A rate decision from the European Central Bank is on the economic calendar today.  The central bank is not expected to go negative from a current base rate from zero percent.           

***** Cattle futures look to open steady/firmer as traders wait to get a read on cash market direction; hogs likely to start with slight follow-through strength. ***** 

   # Speculators were seen taking profits on some of their short cattle bets yesterday on the thought that there may not be much downside risk with live futures down to $100-even.  Futures strength would be supportive for cash market potential were the futures not still trading with a sizable discount.        
   # Traders are going to want to see how the day’s wholesale pork market develops before getting too excited about buying hog futures.  Better packer margins are encouraging for the market but also keep slaughters high.