AgriVisor Morning MarketWatch

Friday, November 04, 2016
***** Corn futures down 2 to 2 1/2 cents; soybeans lower by 2 1/2 to 5; Chicago wheat steady to a penny weaker. *****

   # Another sluggish grain trade overnight.  Market participants are adjusting positions in anticipation of next week’s events.  Election outcomes are to be digested on Wednesday while USDA also issues a crop report.  
   # It is another inside day for December corn futures so far this morning.  The week’s $3.44 1/4 low stands to provide support to the contract.  A retracement of last month’s move up puts downside targets at $3.42 and $3.38.
   # Analysts at Buenos Aires Grain Exchange estimate Argentina’s corn crop to be 39 percent planted.  Some of that will have to be replanted due to flooding that also threatens the country’s wheat crop.  
   # Chinese soybean crush margins are expected to remain robust in the foreseeable future.  Strong feed demand, particularly from hog producers, helps to stir up China’s appetite for soybean imports.
   # Fund traders are estimated to be holding a net corn short near 60-65,000 contracts, net wheat short near 115,000.  The category of large speculators is expected to have a net-long soybean position at 100,000 contracts.  CFTC’s Commitment of Traders report will be released after the bell to show how the various classes of market participants were positioned as of Tuesday.  
   # Clear skies and a light breeze will go a long way in helping many in the Midwest wrap up harvest this weekend.  Key to watch weather-wise is how much or if any rain falls in the Southern Plains Sunday/Monday.   
   # A rough week for WTI crude oil futures leaves the December contract down $4.50 cents.  Traders are doubtful the OPEC can agree on a deal to lower production targets. 
   # This morning’s jobs report counted new nonfarm payrolls at 161,000 last month compared to a consensus estimate near +175,000.  The unemployment rate dropped from 5 to 4.9 percent, as expected.    

***** Cattle futures look to benefit from outside money rolling in; December hogs spending this week working on resistance from their 50-day moving average. *****  

   # Retail demand is improving in response to this year’s sizable deep for beef prices.  A mild weather forecast keeps weight potential up and combines with high slaughters to have the production pace still leaning negative for the market.  Cash cattle are trading steady to $1 higher this week and maintain a small premium to the board.  
   # Hog slaughters run very high but packers are moving through the product rather quickly.  A stubbornly strong production pace has been the major market negative in recent months, but it also pulls the timing of peak supply further forward in the winter than previously projected.