AgriVisor Morning Marketwatch

Tuesday, October 17, 2017
   ***Good Morning***

***** Grains were slightly lower in the overnight trade; soybeans are 5 lower, corn 1 lower, with wheat fractionally lower. ***** 

   # The big story this week is the weather.  Dry conditions will dominate the Corn Belt into the weekend, and even then, it’s looking like the northern areas might be drier than the southern areas, opening up the possibility of an extended good run of weather. 
   # The 6-10 day outlook is normal/dry in the western/northwestern part of the Corn Belt, with the eastern and southern parts a little wetter.  But, the 8-14 day is dry again.  Warmth with dominate early, but near months end, it’s looking like colder weather will emerge.  If precip accompanies this, it would potentially bring light snow to some spots. 
   # Yesterday’s crop progress numbers were not far from expectation with 28% of the corn harvested and 49% of the soybeans.  Progress is still lagging sharply in the west with many states about ½ normal on soybean harvest and about 1/3rd normal on corn harvest.  But those same states will enjoy somewhat better weather in the longer term.  The crop rating got some attention, with soybeans still at 61% g/e and corn up 1 at 65% g/e, but with harvest so far along they matter less, and seem to be following the lead of USDA yield numbers somewhat.
   # Winter wheat planting is 60% done, lagging the normal 71%.  The biggest lag is in the Southern Plains, with Kansas/Oklahoma said to have 6 mln. acres yet to plant, and it’s getting close to insurance dates.
   # There’s a little more talk about the Brazilian wheat crop this week with the passing of USDA report.  Last week, CONAB projected a 4.8 mmt. crop, down from last year’s 6.7.  Imports could be as high as 7 mmt. this year.  And with the wetness plaguing Arg., they could be forced to source more outside of the Mercosur. 
   # Brazilian soybean planting is thought to be 12% complete, about average, but behind last year.  The lags are most prevalent in the center/west area.  For the first time, we are seeing a little more talk in the trade about potential repercussions on the 2nd crop corn. 
   # The Dollar is holding strong this morning, mostly because the Pound is sliding with the BOE Governor warning of risks Brexit could have on Britain.  Equity markets are holding firm ahead of a spate of earnings reports over the next few days.

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

   # Wholesale beef is slightly higher with choice at $198.81. Futures strength is expected to elevate feedlot offers, keeping prices steady/firm, but active sales last week have made packers comfortably covered. 
   # Wholesale pork is slightly higher at $75.25. Cash hog prices are expected to be steady/firm.  Good packer margins are supportive. Hog supplies may have temporarily flattened out, but higher seasonal supplies still lie ahead.