AgriVisor Morning MarketWatch

Wednesday, September 14, 2016
***** Corn futures down fractionally at the break; soybeans fractionally higher; Chicago wheat down 2 cents. *****

   # Even with a crop report and a big follow-up move for prices, trading volume was low for the grains on Monday and Tuesday.  Volume over the two days averaged 255,000 contracts for corn compared to an average for 2016 of 372,000.  Soybeans 208,000 versus 253,000.  
   # With report day in the rearview, the bulk of attention now gets turned to harvest progress and results.  Spotty showers over the past 5 days have pushed back the desired start date for many in the Midwest.  There is no clear trend on yields relative to expectations to report yet, but diplodia fungus has been an early headache for many. 
   # Thunderstorms rolled through central Illinois early this morning in extension from a system that dumped up to 6 inches over parts of northern Missouri.  NOAA’s precipitation forecast calls for light rainfall across Missouri and the southern half of Illinois, through Indiana and Ohio.          
   # Late-season drought in Brazil left the country without large surplus of corn to export.  USDA this week cut their estimate for Brazil’s exports to 16 million tons, which compares to 34.5 million in the prior season.  A winding down of shipments there will be expected to send trade business to the U.S. this fall.  
   # Traders are already sorting out their expectations for the September 30th Grain Stocks report.  Corn bears would suggest that 2015/16 Feed and Residual has been overstated due to in part to a marginal substitution of wheat into feed rations over the course of the year.  
   # Trade chatter is picking up over La Nina possibilities.  Some weather watchers have backed off their odds of an event developing this winter, but most agree that at least a late, weak La Nina is still on the table.  
   # Outside markets have stabilized overnight after a volatile three sessions.  Heightened volatility for stocks, bonds, currencies, commodities might be expected for this winter with all that can occur with global central bank policy changes.  
   # Multinational chemical and pharmaceutical conglomerate Bayer confirmed that it will pay $66 billion in a takeover of Monsanto.  

***** Livestock futures look to rebound on technical buying and should benefit from less weakness spilling over from outside markets. *****  

   # Cattle futures will not likely have to face the same pressure today that an outside market selloff exerted on them yesterday.  Any further gains for futures will have to follow a sustained rebound for wholesale prices and needs some optimism to develop over cash potential.                    
   # Hog futures have the potential to catch up with yesterday’s gains for the wholesale market if those are maintained today.  December futures at new contract lows are also now well-entrenched in oversold territory.