AgriVisor Afternoon MarketWatch

Wednesday, January 25, 2017
***** Corn futures up 3 cents; soybeans down 1 1/2 to 3 1/2; Chicago wheat of 1 1/4 to 2 3/4. ***** 

   # Ethanol production was down a touch on the week but still an impressive 1.05 million barrels per day, on average.  Ethanol stocks continue to grow in bearish fashion.  Implied grain grind was 110 million bushels and keeps corn usage well on track to meet USDA’s current 5.3 billion bushel goal for the marketing year.  
   # Wednesday ethanol numbers are followed up each week by the Thursday export sales report.  New corn sales are expected to come in near 1 million tons, soybean sales around 500,000.  Wheat sales are projected at 200-400,000.  
   # A sale of 141,224 tons of corn will make its way onto next week’s export report.  Corn bulls will hope to see daily sales announcements pop up more frequently in the weeks ahead to help add to an already-robust 3.77 billion bushels of cumulative commitments.
   # President Trump’s talk of a NAFTA renegotiation stirs up some angst over the future for U.S. ag exports.  For example, barriers to trade could become a detriment to what one industry player said could be an increase of 20 percent for Mexico’s corn import needs in 2017.  Mexico currently accounts for about 30 percent of U.S. corn sales commitments not yet shipped.    
   # Crude oil stocks were up 2.8 million barrels on the week, in line with the evening API report but also more than originally anticipated.  Oil prices were able to rebound as traders see OPEC working to make good on its production cut agreement.  
   # The Down Jones Industrial Average hit 20,000 for the first time ever today.  Equity investors remain optimistic despite ongoing global political risk presented by Brexit, the Trump win, leadership turnover in South America, etc.  Stock bulls are, in part, betting on relaxed regulation and fiscal stimulus to help spur growth in the U.S. economy.       

***** Live cattle futures finish fractionally higher in the front, weaker in the deferred months; feeders down $0.22 to $0.40; hogs rally $1.60 to $2.52. ***** 

   # Cattle traders were waiting to see how the cash market shaped up before being a big buyer or seller of futures.  Deals on the Fed Cattle Exchange averaged near $122 to eventually bring out the buyers, but not in a big way.  Wholesale beef prices were mixed on the day with the choice cut average falling $0.17 and the select gaining $1.04 by midday.    
   # Hogs rallied on demand optimism sparked by the latest cold storage report that showed dropping pork inventories.  Cash hogs were mostly steady while the pork cutout average rose by about $1.