AgriVisor Morning MarketWatch

Monday, August 21, 2017
***** Corn futures down 3 cents ahead of the break; soybeans off 5 to 6; Chicago wheat lower by 3/4 to 1 1/4. *****

   # Weekend rainfall keeps grain futures from gaining traction.  Storms are forecasted for today.  Corn makes a new low and as soybeans stay within Friday’s range for now.  
   # Friday’s forecast did not include the storms across the Midwest that now look likely for today.  The earlier-predicted rains on Tuesday are still expected as well.  The two-week outlook is dry but cool.  
   # The Farm Journal Crop Tour kicks off today with Eastern and Western legs that start in Columbus, OH and Sioux Falls, SD, respectively.  The two groups of scouts will each move toward last stops in Iowa.  Traders will be watching closely to see if the crop tour numbers lend any validity to what is currently perceived to be a high USDA corn yield estimate.  
   # Friday’s Commitments of Traders report showed further liquidation of grain longs by the hedge funds.  Their net corn long was pared by 27,000 contracts, the soybean position by 30,000.  The report tracks activity only through last Tuesday; funds are pegged to be about even on corn and soybeans coming into today.  
   # The analysts at Safras & Mercado of Brazil have estimated that country will have exported 24 percent more soybeans in 2017/18 than in the previous Feb-thru-Jan marketing year. USDA projects that Brazil will hold nearly a quarter of the world’s new-crop ending stocks.
   # More focus is being given to exports as of late.  U.S. corn sales are seen starting off slow as our traders face stiff competition from the South Americans.  Some optimism was restored to the soybean demand story after a big ceremonial commitment from China last week.  Wheat shippers are vying for business against Black Sea exporters that are being replenished with big crops, but the recent board price break has restored competitiveness for the U.S. market.  Weekly export shipments will be reported this morning.  
   # Wheat has been a major drag on corn, the former grain seeing its nearby futures contract slipping lower in 10 of 14 sessions so far this month.  December Chicago futures are making new contract lows but are due for a technical rebound after reaching deeply into oversold territory.  
   # Outside markets are quiet this morning - the dollar index, oil, and equity futures all flat.  Investors are waiting to hear more on the latest political goings-on.     

***** Cattle futures look to start steady/weaker as fundamental bears stay in control; hogs face technical pressure after last week’s breakdown.  *****

   # Cattle futures are pressured by supply-side negativity.  Cash and wholesale markets are seen on the defensive.  Boxed beef prices are now trading under their year-ago levels.   
   # A break for pork values last week resulted in a major setback for the board.  October hog futures ended $5.20 off the week’s high.  A loss of support from the major moving averages puts the contract within reach of August’s $64.12 low.