Stocks Indices Set New Highs
Feb 15, 2017
Good Morning! Paul Georgy with the early morning commentary for February 15, 2017.
Grain markets are lower as South American crop production estimates grow. The US Dollar is higher and crude oil lower creating headwinds for the grain complex. Stock indices continue to set new all time highs.
Central Argentina will have more heavy rain late Thursday into Sunday. The rain will likely be heaviest from southern Santa Fe through Entre Rios and Uruguay with heightened concerns of some additional flooding and damage to a few crops, says World Weather Inc.
USDA will release their baseline acreage report for grains on Thursday. This report is not expected to have much of an impact on trade as this report is an update from the numbers they released in October 2016. A more impactful report will be released at the USDA Ag Forum on February 23 and 24.
Argentina is seeking closer relations with Mexico to fill their needs for corn as President Trump seeks to renegotiate trade agreements.
Brazil’s grain analysts are raising total corn production to 90 million tonnes in 2016/17 with nearly 30 million coming from first crop and 60 million production out of the second crop.
NOPA crush will be released today at 11:00 am CT. Trade is estimating 159.1 million bushel crushed in January compared to 150.453 million bushels last year. Soyoil stocks at the end of January are estimated to be 1.510 billion pounds compared to 1.434 on December 31, 2016.
High fructose corn syrup demand in the US has been on the decline since 2006 due to consumers looking for healthier alternatives.
Funds were estimated net sellers on Tuesday. They were thought to have sold 4,500 corn, 7,500 soybeans, 2,000 wheat, 3,500 soymeal and 3,000 soyoil contracts.
Chinese government has reported as many as 79 fatalities from H7N9 bird flu in January, far surpassing the number of deaths in recent years.
Fed Chairman Yellen’s testimony on Tuesday sent signals that the central bank may raise rates at its next policy meeting.
Macro Markets get CPI, US retail sales and US industrial production today.
You are welcome to join us “On the Road”. I will be in the following locations:
Feb. 22, 2017 Ainsworth, NE at the Elks Lodge, 6:00 pm
Feb. 23, 2017 St. Paul, NE at Legion Hall, 10:00 am
Feb. 23, 2017 Cozad, NE at Elks Lodge, 6:00 pm
Reserve seating contact Jim Walz 402-760-1444
Fed Cattle Exchange auction starts at 10:00 am today. Trade will be looking for steady firm compared to last week with only 4822 head being offered.
Packer margins remain in the red by $75 to $80 per head. The larger showlist and weak product may give packers reason to be less aggressive.
Futures rebounded on Tuesday negating a technical breakout to the downside. The futures discount to cash is giving traders reason for positive outlook. April futures contract has support at $112.00 with resistance at $115.72.
Cash hogs continue to improve as supplies of market ready hogs are tight. April futures support comes from its discount to the cash index after the February contract went off the board.
Technical uptrend support crosses at $69.00 which a close below would open the door for further correction.
Dressed beef values were higher with choice up .10 and select up .67. The CME Feeder Index is 128.46. Pork cutout value is up .24.
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