AgriVisor Morning MarketWatch

Thursday, October 13, 2016
***** Corn futures up fractionally ahead of the break; soybeans up a penny; Chicago wheat higher by a nickel.​ *****

   # The computers switched to selling after fresh outside buying interest dried up not long after yesterday’s report release.  Hedge funds sold and estimated 12-15k corn contracts and about 10k soybeans.  The corn position is nearly as short as it had been when futures were making new lows in late August. Managed money maintains a net-bullish soybean bet. 
   # December corn futures posted a bearish outside day on report day and are left trading under technical resistance from their 20-day moving average.  $3.50 has proven to be formidable resistance on the recent move up.  $3.34 1/4 is a downside retracement target and $3.25 a key low.  
   # Chinese trade data was digested by markets overnight.  The world’s top bean buyer imported 7.2 million tons of the oilseed in September, down 1 percent from the September prior.  Custom data show January thru September bean imports up 2.6 on the year.  
   # USDA’s afternoon update on cash grain bids around the country had the Central Illinois average producer basis at 24 1/2 cents under December futures, soybeans at 31 under the November.  The Interior Iowa corn and soybean numbers were 44 and 73 under, respectively.    
   # Grain loadings out of the Pacific Northwest will be slowed next week by a succession of storms that are expected to batter the coastal region with high winds and flooding.  A little more than a quarter of corn, beans, and wheat shipments are made from the PNW.  
   # Wheat prices no longer find support from talk of a shrinking Australian crop.  USDA yesterday upped its forecast for that country’s wheat output to 28.3 million tons, which some suggest is still too light.  There will remain ideas of potential quality issues if frost and flooding continue to be an issue through harvest.  
   # Brexit is the talk of the trade again as a falling pound currency reflects growing worry about the stability of the British economy post that country’s decision to leave the European Union.     

***** Cattle futures facing another wave of selling pressure after two recent, quick-failed corrections.  December hog futures start above their 10-day moving average for the first time in more than a month. ***** 

   # The showlist was smaller this week but producers continue to be motivated sellers.  Cash sales were reported below $100.  Continued aggressiveness on the pace of marketings is thought to be what is needed to help stabilize the supply and demand dynamics.    
   # Hog weights are not accelerating higher as quickly as they normally do at this point in the season, but lighter animals are a product of aggressive marketings, so production levels remain elevated and cash prices thusly pressured.  If anything positive, peak production could come quicker than expected in the fourth quarter.