AgriVisor Morning MarketWatch

Tuesday, May 23, 2017
***** Corn futures down 2 cents ahead of the break; soybeans lower by 4 1/2; Chicago wheat down 1 1/2. ***** 

   # Turnaround Tuesday so far for the grains.  The market lacks fresh fundamental news, so the more firmly entrenched hedge fund bears win out overnight.  
   # Soyoil is the weak link of the soy complex this morning as lower palm oil prices weigh on the product.  Stocks of palm oil in second-biggest producer Malaysia continue to rise, but the outlook for demand remains friendly.  
   # Wet, cool weather throughout Illinois will be expected to lead to acres switching from corn to soybeans.  Many analysts are already penciling in a 1 million acre switch for the country as a whole, adjusting the USDA survey numbers that had farmers planting 90 million corn acres and 89.5 million to soybeans.  Talk of expectations for prevent plant acres is up next.  
   # Corn planting progress was estimated at 84 percent through Sunday, comparing to an average trade guess of 85, last year at 84, and the five-year average at 85.  Soybean progress was pegged at 53 percent, above the estimate of 52, right on last year’s 53, and ahead of the average of 52. 
   # Traders were surprised to see the winter wheat condition rating average improve on the week from 51 to 52 percent Good or Excellent.  The Kansas crop was tagged with a better rating on the week while Illinois’ wheat dropped from 52 to 44 percent G/E.
   # The Brazilian real/ U.S. dollar pairing was under pressure again on Monday while the Argentine peso also faced further weakness.  A shift lower for the real and peso currencies has triggered a wave of farmer selling in South America that has allowed the export pipeline to be refilled.  
   # Outside markets are quiet at the start of the day.  Stock investor enthusiasm is muted after a terror attack in Manchester, UK.  Oil is flat after rising in 10 of the last 12 days.        

***** Cattle futures look to open weaker; same for hogs. ***** 

   # The Cold Storage report showed beef stocks down 1.2 percent on the month and 4.8 percent lower on the year, but a bigger draw down was anticipated. Beef inventories totaled 458.5 million pounds versus a trade estimate of 444 million.        
   # Further strength for cash hogs and more gains for pork helped to support futures, but upside was limited by active profit-taking.  Pork stocks in April were shown up by 9 percent over the prior month, also more than analysts had anticipated.