AgriVisor Morning MarketWatch

Friday, February 23, 2018
***** Corn futures a penny firmer at the break; soybeans up 1 1/2 to 3 3/4 cents; Chicago wheat higher by 4. ***** 

   # The weekly export sales report featured a net cancellation for the 2017/18 soybean book.  A reduction of 109,000 tons was reported after traders expected to see additions of around 750,000 tons.  The corn sale number was strong at 1.56 million tons.  
   # Analysts continue to sift through data reported from USDA’s annual Outlook Forum.  Primary focus is on acres with the government calling corn and soybeans both 90 million each.  Corn area was about as anticipated but the soybean planting projection came in a little light.
   # Out of the USDA conference came an early balance sheet for the 2018 crops.  A trend yield of 174 bushels per acre was used for corn, 48.5 bpa for soybeans.  Smaller yields are seen helping to bring carryout figures down.  Needless to say, it’s early yet for these predictions.
   # The weekly export sales report goes along with three daily sales announced this week.  USDA reported 130,000 tons of corn and two separate cargos of beans on the flash sale system.  All deals were made with unknown buyers.  
   # The situation is improving for winter wheat growers in the Southern Plains after a rainy week has helped provide relief to the dry region.  The Drought Monitor still shows pockets of Kansas, Oklahoma, and Texas rated with a D3 “Extreme Drought” classification.  
   # Warmer temperatures are in the forecast for the Midwest next week.  A sunny start to the week will be broken up by showers starting Wednesday.  The 6-10 day outlook is biased wetter across most of the region.  Weather looks to turn cooler and drier in the 8-14 day timeframe.  
   # Trade officials meet for another round of talks on NAFTA next week.  Reuters reported yesterday on Mexico reaching into Brazil for corn in an effort to supplant some of Mexico’s reliance on U.S. supplies.  
   # Investors are combing through the latest Fed minutes release while waiting to hear from various central bankers today and next week.  Stocks are rebounding after an early February slide.  The Dow Jones near 25,000 is off from its January 26 high at 26,616.    

***** Cattle futures look to benefit from a friendly inventory report; hogs may find follow-through interest from the buy side. ***** 

   # This month’s Cold Storage report showed beef inventories up 2 percent on the month but down 7 percent for the year.  Total inventories were lighter than anticipated.  From projections produced by the USDA Outlook Forum, beef production is estimated to rise by 5.9 percent on the year.  
   # The Cold Storage report was a little negative for hogs as it found belly stocks building.  Total pork supplies were up 16 percent on the month and stand 8 percent higher for the year.