AgriVisor Afternoon MarketWatch

Thursday, June 01, 2017
***** Corn down 1 1/2 to 2 cents; soybeans drop 1/2 to 3 3/4; Chicago wheat fractionally weaker. ***** 

   # Grains were weaker on the day but trimmed losses into the close.  Trading volume was lighter than average with the market mostly devoid of fresh news.  
   # The short-term weather outlook has mixed implications for the market.  Weekend rains will get in the way of farmers working to wrap up soybean plantings and serves as a threat to the winter wheat crop.  The two-week forecast is drier but also does not look to provide many growing degree days.  
   # Analysts look for tomorrow’s export sales report to show 550,000 tons added to the 2016/17 corn book, maybe another couple hundred thousand for the next-crop ledger.  New soybeans sales should total near 300,000 tons.  Small net cancellations may be seen for the 2016/17 wheat program.   
   # Ethanol production was up on the week but stocks were too.  Corn grind was estimated at 102.4 million bushels.  Usage is falling slightly behind the pace needed to meet USDA’s marketing year target.  
   # The managed money corn position is estimated net-short just above 175,000 contracts; soybeans net-short nearly 100,000 contracts; wheat net-short 125,000.  The corn and wheat shorts have been relatively stable over the previous couple of weeks while the bearish soybean bet has grown.
   # July corn broke below the previous day’s range before returning back for an inside settlement.  The contract is above its 20- and 50-day moving averages but trades short of resistance from the 100-day.  The MACD and RSI momentum indicators are biased just slightly positive.  $3.80 is the key high while $3.64 1/4 is the low to watch.  
   # The safrinha corn harvest is kicking off in Brazil’s top-producing Mato Grosso state.  Despite some recent worries about dryness in the North, Brazil is expected to harvest a record crop. 
   # Stocks staged an impressive rally behind strength from the banks.  Investors were pricing in expectations for higher interest rates.  Friday morning’s unemployment report will provide further guidance on interest rates.  

***** Live cattle futures up the $3 limit; feeders finish locked by a $4.50 limit; hogs down $0.17 to $1.00. ***** 

   # Cattle futures finished limit up behind bullish short-term fundamentals of strong beef and the resulting cash optimism.  Choice and select beef cuts are running a respective 11 and 8 percent higher than a year ago.             
   # Similar to cattle, pork packer margins are robust and help bolster the seasonal uptrend for cash prices.  But, traders deemed hog futures overbought today and took profit on longs.