AgriVisor Morning Marketwatch

Tuesday, November 15, 2016
   ***Good Morning***

***** Grains are mixed/slightly higher this morning; soybeans fractionally lower, corn 1-2 higher, with wheat 2-3 higher. *****

   # The talk about a Chinese clampdown on commodity speculation seems to still be dominating the conversation.  There really isn’t much new today, but traders are waiting on an indication the liquidation adjustment has come to an end.  That may keep a lid on their futures for the immediate future, and others as well.
   # At least the Presidential shock appears to have been built into prices for now.  The Dollar is slightly lower, Treasury instruments are slightly higher, and commodity indices are trading a bit stronger today.  Equities are holding firm, but still hesitant. 
   # The only surprise in the weekly crop data may have been the slight upward adjustment in the winter wheat ratings.  The crop is now rated 59% good/excellent, up 1 point. Increases were noted in the S. Plains, an area where there’s been some dryness concern.  Planting is 94% done, with 84% emerged.  Corn harvest is 93% done, with soybeans 97% complete.
   # Trading funds increased their short positions in Chi and KC wheat.  Commercials increased their long position slightly.  Funds expanded their long positions a lot in soybeans.  And they had aggressively pared their short corn position.  All of this data is of last Tuesday, election day, setting the stage for the hard adjustment after.
   # Ukraine continues to have some logistical difficulties loading corn, which should bolster our business, but our ability to load corn is currently being hindered by soybean shipping, and it may be 3-4 weeks before that begins to taper. 
   # The Brazilian Real has steadied today, but it’s recent break has tipped the balance a little in favor of the Brazilians regarding prices in the world trade.  Early planting also hints of earlier shipping this year.  But as the trade learned last year, a great crop is still far from certain. 
   # Weather remains an element, both in the U.S. and S. America.  The U.S. will remain warm, but the long range forecast continues to show better potential for some moisture in the Great Plains again.  Given recent dryness that is an important situation to track.  
   # Northern areas of Brazil will see showers this week, helping crop prospects.  But southern Brazil and Argentina will see the pattern turn drier the latter part of the week.  Initially that is good, as it helps planting, but there has been talk the extended pattern could stay drier.  With some forecasters indicating the Pacific could develop a weak La Nina pattern, that could be an important area to watch.
   # The Dollar finally appears to have stalled in its short term surge.  Levels being near the highs of the last 2 years may be discouraging enthusiasm.  A couple of German economic reports were disappointing, weighing on the Euro.  The Reserve Bank of Australia was talking about inflation possibly returning.

***** Cattle should start the day mixed/firmer; lean hogs slightly weaker. *****
   # Wholesale beef is slightly lower with choice at $183.92. Cash cattle prices are expected to be near steady, with possibly a slightly negative bias.  Feedlot showlists are thought to be slightly tighter this week.
   # Wholesale pork was slightly higher at $74.66. Cash hog prices could be slightly softer again today.  Supplies continue to run a little heavy.