AgriVisor Morning MarketWatch

Wednesday, January 04, 2017
***** Corn futures up a penny ahead of the break; soybeans higher by 3 to 3 1/2 cents; wheat fractionally firmer. *****
   # The preliminary CBOT report had corn open interest up 7,197 contracts, soybean open interest flat.  The first trade day of 2017 featured corn and soybean spreading to kick off an expected stretch of fund portfolio rebalancing efforts.    
   # Farmers in Argentina have some worry over wet weather that is getting in the way of their efforts to finish planting.  Some areas in the eastern part of the country received a quick 5 inches or more over the past few days.  Corn plantings are estimated at about 70 percent nationwide, soybeans 80 percent.  
   # A dry northeastern Brazil is less of a worry for farmers there now that the region has received some timely rains over the past five days.  The concern will remain that dry areas will expand south to eventually hurt production prospects for Brazil’s second corn crop.  The second corn crop is planted in January/February and is harvested starting in June.
   # Cold weather across the U.S. this week has a good chance of being followed by above-average temperatures late next week, at least for the majority of the Midwest.  The 6-10 and 8-14 day outlook maps continue to lean wet for most of the country.
   # Yesterday’s $3.51 1/2 - $3.58 1/2 range for March corn will help to give some short-term technical guidance for futures.  The contract starts with support from its 50-day moving average.  March soybean futures dipped below their 100-day moving average yesterday and approach a test of key support from $9.83 3/4.          
   # The currency market is volatile at the start of the new year.  The dollar will take some guidance from an afternoon release of minutes from the last Fed meeting.  Traders are watching capital rush for the exits in China to pressure the yuan.  The euro is stronger this morning on better economic data for Europe.   

***** February cattle start with a test of chart support from their 20-day moving average; hogs face pressure after bearish reversal on Tuesday.  *****

   # Cattle futures are facing pressure from profit-taking triggered by a bearish chart move that occurred at the end of last week.  The market maintains general support from robust cash and wholesale values, but those higher prices are likely to find some eventual pushback from the buyer.  
   # Hog futures are running into some selling pressure after a strong run to end 2016.  Futures maintain a hefty premium to the cash market and the cash may have trouble catching up with demand not having a lot of room to grow right away.