AgriVisor Morning MarketWatch

Friday, November 18, 2016
***** Corn futures up fractionally at the break; soybeans down 1 1/4 to 2 1/4 cents; Chicago wheat down 3/4 to 2 1/2. *****

   # Grains trade mixed on moderate overnight volume.  Outside markets are mostly flat, which means the dollar is not yet backing off after a sharp two-week run.  
   # The early-November palm oil rally has stalled, but prices continue to hover near multi-year highs.  U.S. soyoil futures currently lack the spillover support that stronger palm oil had provided them and stand almost 4.5 percent lower on the month versus soybeans that down 2.5 percent. 
   # Weather in South America is taking a favorable turn for growers there with Brazil receiving rainfall where it is needed and Argentina is drying out in areas where planting needs finished.
   # A lack of imminent weather threat in Brazil and a falling real currency may be hastening China’s rotating of soybean purchases away from the U.S. Soybeans will be ready to harvest in Brazil starting in January.  
   # USDA’s Illinois Cash Grain Prices report tallies the central state average corn basis at 16 1/2 cents under December futures with soybean basis 27 1/2 under the January.  The Interior Iowa report marked yesterday’s corn and bean producer basis values at 45 and 78 cents under, respectively.     
   # Investors may be likely to funnel more money into the commodity space in coming months as they bet on the new president enacting the types of pro-growth fiscal policy that boost inflation.  Indeed, index funds have been more active buyers of the grains lately, having picked up about 30,000 new corn and soybean longs since the beginning of October.   

***** Cattle futures look for fundamental guidance from Friday’s Cattle on Feed report and beef demand performance into December; hogs struggling to hurdle technical resistance in the face of negative fundamental biases. *****

   # Cattle bulls are working to sustain momentum on the recent upswing for futures, but will need help from Friday’s Cattle on Feed report to do so.  Traders expect placements near 96 percent of last year’s total with marketings up to 105 percent, leaving total on-feed at around 99 percent.      
   # Hog slaughters look to be backing off last month’s pace but last week still ran 2.5 percent higher than a year ago.  Packers making strong margins help to support the wholesale market, which in turn is keeping cash values from moving any lower than they otherwise would.