AgriVisor Morning MarketWatch

Tuesday, September 05, 2017
***** Corn futures up 3 to 4 1/4 cents; soybeans higher by 9 to 10 1/2; Chicago wheat approach the break with gains of 6 1/4 to 11 1/2. ***** 

   # Grains rally as hedge funds cover shorts ahead of expected seasonal strength.  Futures are also still working on an extension of last week’s technical rebound.  
   # The CFTC’s Commitments of Traders report marked hedge funds net-short corn by 65,000 contracts through last Tuesday.  Their soybean position was left net-short by 28,000 contracts.  The fund wheat holding was net-short 78,000 contracts in Chicago.
   # Hurricane Irma is heading toward Puerto Rico and Florida.  The Category 4 storm could hit the Caribbean islands early this week before potentially reaching the east coast of Florida by late next weekend.  
   # Hurricane Harvey has boosted gasoline prices in a way that is friendly to ethanol margins.  Traders are talking that a government mandate allowing the early sale of E-15 ethanol blends may be used to help alleviate tight gasoline supplies.  
   # Friday’s $3.60 3/4 high is first up to provide potential pushback to CZ17 today.  That market coincides with a 38 percent retracement target relative to the August price slide.  The 20-day moving average drifts lower from $3.63. 
   # Survey-based yield estimates from Allendale (166.7 bushels per acre corn and 47.1 bpa soybeans) and FCStone (166.9 bpa corn and 49.8 bpa soybeans) were reported last week along with a pair of predictions from Informa (169.2 bpa corn and 49.4 bpa soybeans).  The newswire services will release estimates from a collection of industry analysts later this week.  USDA crop report day is September 12th.      
   # Gold futures are up another $3.50 an ounce this morning as many investors flock to safe haven assets.  A hydrogen bomb test by North Korea keeps traders on edge.  

***** Live cattle look to start steady/stronger; hogs look to build on last week’s rebound strength. *****

   # Cattle futures were showing signs of stabilizing late in August after boxed beef prices found a short-term bottom.  Buyers may look to ride a strong seasonal pattern for futures, but conviction for the trade will turn lacking if weak cash fundamentals stay in the way.          
   # A stiff premium for the cash market helps support hog futures from declining further under pressure from bearish longer-term supply considerations.  October live futures trade a premium to the December, but the rest of the curve is bear spread.