AgriVisor Morning Marketwatch

Friday, September 14, 2018
   ***Good Morning***

***** Grains are mostly slightly higher to start the day; soybeans are 1-2 higher, corn fractionally higher, with wheat 7-8 higher. ***** 

   # There’s not a huge amount of news to work with as the week comes to a close, leaving much of the activity to pre-weekend positioning, and/or short covering.  
   # Wheat may have the most interesting story to end the week.  In the world cash markets, U.S. prices are again competitive with the rest of the world, Russia included.  With that, there’s talk the U.S. may capture a part of some of the bigger buy tenders that were recently floated. There’s also talk the Russians may rein in wheat exports by regulating pathogenic certificate clearances. 
   # Corn/soybean strength may be restrained by good weather across much of the Midwest into middle/late next week. With a rainy patter in the longer range outlooks, activity may be somewhat more aggressive as long as crops are ready. This could bring some pre-weekend hedging toward the close.
   # The trade will be watching for details/clues on the looming talks between Administration officials and the Chinese. Discussions on issues have been ongoing since last month’s preliminary meeting, with some Chinese officials apparently requesting another meeting.  A date hasn’t been set.  But, so far the Administration has refrained from initiating the next $200 bln. of tariffs on Chinese imports.
   # Analysts in Argentina are reporting producers plan to shift acreage away from corn back to soybeans in the wake of the new export taxes on corn and wheat. This looks like a reversion back to the pattern that prevailed when export taxes on grains were in place prior to when Macri became President.
   # Reports out of Brazil indicate producers are willing sellers of new crop soybeans. 22% of the crop is thought to have been priced, double last year, but lower than historical norms.  The decline in the Real has been one of the key components, keeping domestic prices high, along with the premium Brazilian prices have to the US in the world market. 
   # There has been a report of an incident of African Swine Fever reported in a wild boar in Belgium. China is said to be taking moves to limit the spread of African Swine Fever, including the banning of feeding household waste.  This is a situation to continue to monitor.  
   # The Dollar rebounded Friday, after slipping lower through the week. Strength was capped by a soft retail sales number, the softest they have been since February. Stock market were slightly higher, but strength was subdued because of the retail sales and the gains through the week. 

***** Cattle should start the day mixed/lower; Lean steady/firm. *****  

   # Wholesale beef is slightly lower with choice at $204.04. Cash cattle trade has been limited all week, but in the short term there may be hesitancy up and down the cattle/beef pipeline considering the uncertain direction of the hurricane remnants once it moves over land. There will be a cash trade today, but it may be steady at best.  
   # Wholesale pork is lower at $71.05. Cash hog prices are expected to be steady/firm. The decline in wholesale prices could cap live strength, but good packer margins and demand for Saturday slaughter will be supportive.