AgriVisor Morning Marketwatch

Monday, October 09, 2017
   ***Good Morning***

***** Grains were mixed/lower in the overnight trade; soybeans are 1-2 lower, corn fractionally lower, with wheat 1-2 lower. ***** 

   # Today’s market will about looking ahead to Thursday’s report, weather, and the crop progress numbers.  Because it’s a holiday, there will be no report releases from the government; with this week’s daily numbers all delayed a day.  
   # We’ve only seen 1 estimate for harvest progress, and it put soybeans 43-45% done, with corn at 27-29% done.  If anything, given last week’s weather, the soybean number could be a little high.  Winter wheat planting is expected to be 45-47% complete.  Again, the report comes out tomorrow. 
   # Depends on who you poll.  Reuters puts the yield estimates for corn and soybeans at 170.1 bu. and 50 bu.  Corn is up 0.2 from last month with soybeans up 0.1 bu.  The soybean number shows an acreage increase of about 250,000.  It could be larger than that.
   # Bloomberg’s poll kept the soybean yield unchanged at 49.9 bu., with the corn yield dropping 0.1 bu. to 169.8 bu.  Bloomberg’s poll also showed a slightly larger soybean acreage increase than Reuters.
   # Tomorrow, we are also getting CONAB’s first official estimates for this year’s Brazilian crops.  A poll showed trade expectations at 109.98 mmt.  Planted area is expected to be increased to 34.77 mln. hect. from last year’s 33.91 mln. Corn production is expected to be projected at 93.2 mmt., down from last year’s 97.7 mmt. output.  Brazil’s soy planting is thought to be 5.6% complete, about average.  Last year was 10% done.  Mato Gross is only 5% done, behind avg., and about 1/3rd of last year.  They are a big 2nd crop corn producer. 
   # Rain is expected to be a modest impediment to harvest again this week, with early/midweek rain keeping conditions somewhat wet.  Even the longer range outlooks are not favorable for great activity, especially the 6-10 day outlook.  Probabilities are high for above norm precip across the heart of the Corn Belt. They do abate a little in the 8-14 day.  Temps will be warm.
   # Wet weather remains a problem in Arg. 51% of their wheat area is effected by wet conditions.  There’s talk of potential problems with fusarium mold.  Corn planting is said to be 16.5% done, although recent activity has been hindered by rain. 
   # The weather outlook across the center/west area of Brazil continues to be on the dry side, a pattern that will continue to hinder soybean planting.  If it hasn’t changed by week’s end, concern will start to elevate, with seasonal rains normally ramping up by mid-month. 
   # Friday’s CFTC report showed funds were small sellers of soybeans; sold about 10,000 contracts of corn, but were buyers of 8000 contracts of wheat.  Funds are still slightly long soybeans, but short corn and wheat. 
   # Rains should ease the low water problems on the Miss and Ohio Rivers.  Barge freight rates were sharply lower at the end of last week, and should continue weakening this week.  That will help shore up basis levels along the river system.
   # The Dollar is starting the day near steady, and may remain somewhat subdued by the govt. closure.  Strength in the Pound was the most notable feature of the day.  Negative Dollar attitudes generally persist with N. Korea expected to test another missile.  There is some support for the Dollar coming from Friday’s rise in wages on the monthly employment report. 

***** Cattle should start the day slightly higher; lean hogs mixed. *****  

   # Wholesale beef is steady with choice at $197.22. Last week’s cash trade ended stronger than expected, setting the stage for feedlots to price animals several dollars higher to start this week. 
   # Wholesale pork is slightly lower at $72.61. Cash hog prices are expected to be steady/firm to start the week.  Packer margins are good and near term numbers are manageable.  But, supplies will continue to rise into year’s end.