AgriVisor Morning Marketwatch

Tuesday, October 03, 2017
   ***Good Morning***

***** Grains were mixed in the overnight trade; soybeans are 2-3 lower, corn 1-2 lower, but wheat is fractional-1 higher. ***** 

   # Today’s market will likely be a mix of response to the weekly crop progress numbers and the weather forecasts.  USDA continues to put out condition rating numbers, but those have receded in importance with the harvest now well underway.  Actual yield reports will be more important to the trade from this point forward.
   # Corn harvest is now 17% complete, slightly less than the trade expected to see.  68% of the crop is mature, limiting weather’s impact on yield.  The bigger unknown is how fast it will dry with the weather and weather’s impact on the pace of harvest.  
   # Soybeans are 22% harvested, a little less than expected.  80% of the crop is dropping leaves, with the crops lagging in development in the Southern Corn Belt and Southeast.  Harvest is more advanced in the eastern Corn Belt, with weather slowing field activity in the west. 
   # Winter wheat harvest is 36% complete, but is lagging the normal pace even though acreage will be no larger than last year.  It is especially slow in parts of the S. Plains.  
   # Both Russian and Australian situations continue to play large roles in the wheat market.  The latter continues to have weather problems in the eastern part of the country in particular.  In Russia, wheat prices are edging higher, helping support prices and demand across the other major players in the world trade. Farmers are holding back on sales, wanting higher prices.  Meanwhile, buyers are becoming a little more aggressive covering their needs.
   # Planting is still slow to get underway in Brazil with only 1.5% of the soybeans planted, compared to a more normal 4%.  Rains appear to still be lacking in more northern areas.  There is talk the poor rains in Sept might have cut 1st crop corn planting intentions even more.  Planting of that crop is 23% done.
   # Brazil’s Sept exports were good, with 5.9 mmt. corn shipped, higher than last month and nearly double last year.  Soybean exports 4.27 mmt. were down from last month, but well over last year.  They’ve had the best 12 month export period ever, but that’s because the record crop gave them potential to export record quantities.
   # The August U.S. corn grind was 5.8% higher than July, and 4.9% higher than last year.  Our soybean crush, 151.5 mln. bu. was in line with the mid-month NOPA number.
   # FC Stone’s new crop estimates were higher than their previous numbers, but in line with September USDA estimates. They are now expecting a 169.2 bu. corn yield, slightly under USDA, and a 49.9 bu. soybean yield, matching USDA.
   # Ukraine is a little ahead of last year on winter crop planting; wheat is 59% done, with barley at 17% complete.
   # Russia has harvested 125.6 mmt. of grain, of which 84.7 mmt. was wheat.  Both may be bunker weight, so final clean weight numbers should be lower.  Still this is a great crop.
   # Low water levels on the Miss River is causing some problems, forcing barge rates higher and spot harvest bids lower.  Over the last week, rates on some sections are said to have jumped 25-50%.  The rainier pattern over the next week may ease that some.
   # The Dollar slipped a little in the overnight trade, but is holding firm in anticipation of a December Fed rate hike.  At the same time, long bond yields are edging up in anticipation of Fed sales from their “book.” The weekend’s vote in Catalan for independence is weighing on the Euro this week. 

***** Cattle should start the day steady/firm; lean hogs steady. *****  

   # Wholesale beef is slightly higher with choice at $197.22. The cash cattle trade was poorly defined to start the week, but firmer product over the last week should hold cash bids near steady. 
   # Wholesale pork is slightly lower at $72.78. Cash hog prices are likely to trade steady firm, with packers wanting animals to push product into the pipeline for Nat. Pork Month.  Still, numbers are abundant, with higher weights indicating they have plenty to choose from.  Hog futures are at a premium to the cash index.