Strong start to the week for grain/soy futures... Bulls dominated overnight trade in grain and soy futures amid followthrough buying from a strong close last Friday. Support is coming from tight old-crop soybean supplies, geo-political tensions between Ukraine and Russia, weather concerns and a weaker U.S. dollar. As of 6:30 a.m. CT, corn futures are trading 2 to 3 cents higher, soybeans are 5 to 16 cents higher with old-crop contracts leading gains, SRW wheat futures are 1 to 2 cents higher, HRW wheat futures are 3 to 6 cents higher and HRS wheat futures are 2 to 3 cents higher.
G7 agrees to impose new sanctions on Russia... Group of Seven (G7) leaders have agreed to impose new, targeted sanctions against Russia. The U.S. and European Union each will develop their own lists of targets. President Obama today said the U.S. would impose a new round of sanctions against top Russian officials designed to spur Russian President Vladimir Putin to "walk the walk not just talk to talk" toward deescalating the crisis in Ukraine. "The sanctions build on the ones that were already in place. The targeted sanctions are expected to hit close allies of Putin, as well as companies in the Russian defense industry. As with earlier sanctions levied against Moscow over its incursion into Ukraine, they will include asset freezes and travel bans. Global sanctions are having a harsh effect on Russian President Vladimir Putin and are likely to force him to change his tact in Ukraine, according to White House Deputy National Security Advisor Tony Blinken. He noted that Russian financial markets are down 22% since the beginning of the year, in large part because of the success of sanctions from the U.S. and other nations. Russia's central bank raised its key interest rate Friday, hours after Standard & Poor's Ratings Services cut Russia's debt ratings to one notch above junk.
Washington focus is on FOMC meeting, jobs data, a tax extenders markup, 2015 spending bills and hearings on Obama's trade policy agenda and the livestock sector... Congress returns from a two-week spring break with continued work on FY 2015 appropriations work, a House panel markup of tax incentives, a House subcommittee hearing on the state of the livestock industry and a Thursday hearing on President Obama's trade agenda being the highlights of this week in Washington. The Thursday trade hearing in the Senate Finance Committee will be interesting to see whether or not U.S. Trade Representative Michael Froman details the so-called "breakthrough" in recent U.S.-Japan trade talks. On Tuesday, the House Ways and Means panel marks up its version of lapsed tax incentives. Also of note, the two-day Federal Open Market Committee meeting will conclude Wednesday with the Fed expected to keep tapering its monthly bond purchases. The release of March jobs data is Friday.
Unfavorable weather outlook this week... Conditions are expected to be cool and wet across the Corn Belt this week after heavy rains over parts of the region Sunday. Some areas saw active corn planting progress the bulk of last week, but the cool, wet weather will limit fieldwork this week. Cold, wet conditions will also keep fieldwork at a standstill in the Northern Plains. Meanwhile, the driest areas in the southwestern Plains continued to face stress from hot, dry and windy conditions over the weekend. Temps are forecast to cool this week, but conditions will remain dry, further stressing the wheat crop.
HRW wheat tour runs this week... The annual Wheat Quality Council HRW wheat tour runs Tuesday through Thursday, with scouts pulling samples throughout Kansas and far southern Nebraska. Yield reports from Oklahoma and Colorado will also be issued this week. Attention on the data is high given deteriorating crop conditions amid ongoing drought in the Plains.
Push back today from corn refiners, sugar users re: Mexico sugar trade case... Representatives of the Sweetener Users Association and the Corn Refiners Association will hold a news conference today to note concerns with the antidumping and countervailing duty case sugar growers have brought against their Mexican competitors. USDA Secretary Tom Vilsack previously said the U.S. sugar grower push was "ill-timed" but the International Trade Commission (ITC) agreed April 18 to conduct a preliminary review into whether Mexican imports have harmed U.S. growers. Some industry and government representatives from Mexico said the country should not be blamed for a collapse in prices.
Friendly Cattle on Feed Report... Friday's Cattle on Feed Report showed Placements below the bottom end of the pre-report guess range. That's supportive for deferred live cattle futures. The On Feed number was also smaller than expected, but buying interest may be limited in nearby futures by steady to weaker cash cattle trade in the Plains late Friday.
Cash hogs called steady/weaker... Packers are expected to open the week with steady to weaker cash hog bids across the Midwest. While market-ready supplies are tight, packers are working with negative margins, which limits their willingness to bid up for cash hogs.
Overnight demand news... Israel tendered to buy 108,000 MT of optional origin corn and 60,000 MT of optional origin feed wheat.