AgriVisor Morning MarketWatch

Tuesday, September 13, 2016
***** Corn futures down a nickel; soybeans off 6 to 7; Chicago wheat lower by 4 1/2. ***** 

   # Grains start the first post-report session on the defensive.  Traders are pricing in their misses after USDA took corn yield down by less than expected (0.7 bushels per acre to 174.4 bpa) and added more to bean yield (0.7 bpa to 50.6 bpa).
   # As expected, USDA made no changes to acreage on the September report.  Some analysts are suggesting the need for small additions to planted area for both corn and soybeans after looking through the most recent Farm Service Agency (FSA) numbers.  Others say it’s too early yet in the FSA acres reporting cycle.  
   # Outside markets are not helping the grains out any.  A volatile couple of days for stocks and bonds have resulted from the anxiety growing around global central bank policy.  
   # Yesterday provided a first look at a national average for corn harvest progress.  USDA crop scouts called the country’s crop 4 percent harvested versus 5 percent last year and 7 percent for the five-year average.  IL – 5 percent; IN – 1; Missouri – 12. 
   # The soybean crop held at an elevated 73 percent Good or Excellent through Sunday.  30 percent of the crop is dropping leaves.
   # Showers have the potential to pop up throughout the Midwest late tonight.  Most of Illinois/Iowa have some moderate chance for rain in each of the next 10 days.  The 8-14 day outlook map is wet and warm but comes along with a 2 out of 5 confidence rating.  
   # Lower Asian palm oil prices helped to weigh on the broader edible oil market overnight.  Palm exporters had a good August but are not shipping as much so far in September.  Inventories in the top-producing Malaysia and Indonesia are still declining, but a return to more-normal production levels is expected this season after last year’s drought.  
   # Fund traders come out of report day with an estimated net corn short of around 180,000 contracts with a net bean long still being maintained around 80,000.     
   # The economic calendar is empty today.  Thursday will include a host of reports, including Business Inventories, Initial Jobless Claims, Producer Prices, Retail Sales, and Industrial Production.   

***** Cattle futures look to enjoy some follow-through strength; hog spreading likely to define the futures trade again today. ***** 

   # Aggressive cattle marketing this summer has served to take weights down and, maybe more importantly, reduce numbers available for slaughter this fall.  That leaves the rest of the onus on demand, which there remains enough pessimism over to keep prices on the defensive.                
   # Hog futures remain choppy as traders price in expectations for better demand against margin incentives that keep pork production high.  Cutout values were mixed to keep the carcass average flat yesterday while cash prices were still taking on a weaker tone.