AgriVisor Morning MarketWatch

Tuesday, August 01, 2017
***** Corn futures down 1 1/2 ahead of the morning break; soybeans lower by 14 to 15 cents; Chicago wheat up a penny. ***** 

   # Soybean futures are the morning’s loss leader after Monday’s Progress report showed bean crop conditions improving last week.  Weather is biased just slightly price negative with rain expected to fall across most of the Corn Belt during the next three days.
   # December corn futures ended 7 1/4 cents lower on the month of July after trading a range of 38 cents.  November soybeans held onto gains of 52 1/2 cents on a range of 84 cents.  December Chicago wheat, down 45 1/4 with a range for the month of 95 1/4. 
   # The 6-10 day outlook turned wetter on Monday afternoon.  It stays much cooler than normal.  Government forecasters tag their predictions for the timeframe with a 4 out of 5 confidence rating.  The 8-14 outlook maps are also wet and cool for most of the Corn Belt. 
   # Soybean crop conditions improved by two points on the week to 59 percent Good or Excellent.  Illinois was the main contributor to a higher average after the state’s soybean crop was called better by seven points at 66 percent G/E.  
   # USDA crop scouts called corn 61 percent G/E, down one point from last week.  Many had expected the number to remain unchanged; some looked for a one point improvement.  Illinois and Iowa were rated above the nationwide average at 63 and 65 percent, respectively.
   # USDA’s Cash Grain Prices report listed Monday’s Central Illinois basis averages at 30 1/2 cents under September futures for corn, 24 1/2 under August soybeans.  Corn and soybean basis averages for the Interior Iowa region were recorded at 51 and 61 cents under, respectively.
   # It remains an inside day for December corn futures so far this morning, leaving yesterday’s low at $3.81 1/4 to lend minor support.  More formidable support lies at June’s 6-month low of $3.74. A gap is still left open from Sunday night’s open, with a trade at $3.86 1/2 taken to close it.  
   # The dollar index is choppy around the unchanged mark so far this morning.  Marking five straight monthly losses, the index dropped another 2.9 percent in July.  Traders have a) found the Fed to be much slower raising interest rates than had been expected a year ago or more; and, b) economies abroad have turned out more healthy than expected.

***** Live cattle and hog futures markets both look to start with technical pressure as the October contracts approach old lows. *****

   # Big slaughter numbers weigh on cattle futures early in the week and expectations for a larger showlist keeps the supply-side headwinds strong.  October cattle start with a test of the three-month low at $111.15.      
   # Fund traders look to be taking profit on a substantial net-long hog position that had been built over the last three months.  Market participants see that domestic consumption has slipped back a touch in a way that will help pork inventories rebuild.