AgriVisor Morning MarketWatch

Monday, November 20, 2017
***** Corn futures fractionally weaker ahead of the break; soybeans down 3 1/2 cents; Chicago wheat off 3 1/2 to 4. *****

   # Grains are biased weaker at the start of a new week.  Thanksgiving makes it a short holiday week with grain markets closed on Thursday and finishing at noon on Friday.   
   # Last week ended with a trader positions report that showed hedge funds holding a record net corn short.  Money managers will be looking to decide whether to take profits on bearish bets now that the U.S. harvest is wrapping up or to wage another offensive in attempt to bring prices down toward last fall’s $3.01 futures low.  
   # Soyoil is the weak link of the overnight session, pressured by spillover selling coming from the Asian palm oil market.  Palm oil prices tumbled lower on Monday after it was announced that India has doubled their import tariff to 30 percent.  
   # It was a wet Saturday morning across the Eastern Corn Belt with totals of up to five inches falling fast in parts of central Illinois.  The weekend rain event keeps the ECB soggy, but the region should benefit from a couple of dry days ahead.  Chances for showers in the Midwest rise again next weekend to break up what should be a mostly dry last two weeks of November. 
   # Traders are watching to see if storms in the forecast for Argentina this week actually materialize.  Several of the country’s key growing regions are taking on an overly dry bias after having experienced an October that was too wet.  Wetter conditions in Brazil are favorable for crops already in the ground but may cause further delay to planting efforts.  
   # The weekly look at grain export inspections will be issued this morning.  Grain prices have struggled to mark out a clear harvest low in part because a disappointing start for the export programs makes for an uninspiring outlook for demand.  In big crop years such as this one, market focus is normally shifting at this time from questions of size to questions about usage.
   # Outside markets are quiet to start the week.  Oil futures suffer moderate losses as U.S. product remains well-supplied.  Stock futures are flat as investors await further developments on the GOP tax changes.  The dollar is up fractionally against the currency majors but the index is still leaning defensive after falling last week.       

***** Cattle futures look to be pressured by bearish COF numbers at the start; hogs likely to trade lower in sympathy but losses may be limited as technical buyers step in. *****

   # Cattle futures will use Monday to price in a reaction to Friday’s Cattle on Feed report.  Placements were again higher than expected at 110 percent of last year’s total.  Marketings near 106 percent were fully anticipated.    
   # Hog futures are registering oversold after a steep three-week selloff.  The December contract would find technical resistance from its major moving averages, which gave up their support to the board last week.  On the fundamental side, product values have taken a bearish turn and combine with a short holiday week to make for weaker cash expectations.