AgriVisor Morning MarketWatch

Wednesday, November 08, 2017
***** Corn futures a penny lower; soybeans up 1 1/4 to 2 1/2 cents; Chicago wheat off 3. ***** 

   # Grains are again quiet overnight.  Wheat is the weak link at the start after failing to generate any significant momentum on the few days of strength observed so far in November.  Soybeans continue to display a firmer bias.
   # Part of the sustained strength for soy comes about from expectations of a yield reduction on Thursday’s crop report.  Optimism over export potential is growing.  And, the two-week forecast for Brazil has turned drier.
   # A rebound for the Brazilian real currency lends some extra support to U.S. soybean prices this morning. The real has been weakening against the dollar in recent sessions to help improve prices paid to Brazilian farmers and make their exports more attractive to world buyers.  
   # Soyoil futures start out as the leader of the soy space this morning, finding some help from higher Asian palm oil markets.  Palm oil prices had been turning defensive lately as stockpiles grow.  A key report on Malaysian supply will be issued on Friday to help give the market direction. 
   # Crop Production and WASDE reports are due out at 11:00 am central tomorrow.  Most analysts expect to see the government’s soybean yield come down fractionally, corn yield up by 1-2 bushels per acre.  The anticipated yield adjustments help traders to look for soybean ending stocks down, corn carryout up.
   # Fund traders are heading into the Thursday crop report with a bearish corn bet that totals around 200,000 contracts. The managed money soybean position is estimated net-long by something a little short of 50,000 contracts. Hedge funds have a Chicago wheat position that is net-short by about 100,000 contracts.   
   # Chinese soybean imports were tallied at almost 6 million tons in October, which represented a 12 percent improvement over a year ago.  Cumulative exports from January through October totaled 77 mt and were up 15 percent on the year.  
   # Outside markets are quiet for now.  Investors are eager to see how President Trump’s visit with China goes this week.  All are also keeping an eye on the latest developments regarding the Republicans’ tax cut agenda.  The Senate’s plan is so far forming much differently than that proposed by the House. 

***** Cattle futures look to open steady/weaker; same for hogs. ***** 

   # Cattle futures are waiting for guidance from the cash trade, which should develop more fully today with help from trading on the Fed Cattle Exchange.  Last week’s benchmark for cash deals was near $125.          
   # Hog futures are giving in as the cash values slip lower.  The charts are leaning much less friendly with the December contract breaking below trend and losing support from its 20-day moving average.