What Traders are Talking About:
Overnight highlights: As of 6:15 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are 5 to 7 cents higher and wheat futures are fractionally to 4 cents higher with HRS contracts leading gains. Pre-report trade is likely today, though funds were active sellers of corn Wednesday, as they added to an already sizable short position. Cattle futures are expected to be mixed as traders await cash cattle trade. Lean hog futures are called slightly lower this morning.
* Brazil raises crop estimates. Conab, the supply agency of the Brazilian government, modestly raised its soybean crop estimate to a record 90.33 MMT from 90.03 MMT last month. However, the country's ag minister says the soybean crop could "easily" top 95 MMT as he expects yields top current expectations. Conab now forecasts Brazil's corn crop at 78.97 MMT compared to 78.78 MMT last month. The agency continues to assume a safrinha (second season) corn crop that's in line with last year's record production. Others expect a much smaller Brazilian corn crop as they expect safrinha acreage (and possibly yields) to decline from year-ago.
The long and short of it: A 90 MMT Brazilian bean crop is being factored into prices. A 95-plus MMT crop is not currently factored into prices.
* Canadian resident dies from bird flu. An Alberta resident has died after contracting the H5N1 strain of bird flu while on a trip to China. This is the first confirmed human case of bird flu in North America, a disease which has been in China and other Asian countries for years. Canadian health officials say the case was isolated and the risk to others is very low, though they are contacting others who were on the same flight from Beijing to Vancouver, British Columbia as well as those who were on a connecting flight to Edmonton, Alberta.
The long and short of it: Market impact will be limited unless there are other cases of bird flu confirmed in Canada (or anywhere in North America). If that were to happen, it would become another negative for grain markets.
* December Chinese inflation in line with expectations. China's consumer price index (CPI) rose 2.5% over year-ago last month, which was right in line with expectations and down from a 3% increase in November. Food prices rose 4.1% while non-food prices firmed 1.7%. For all of 2013, Chinese inflation rose 2.6%, well below the government target of 3.5%. China's producer price index (PPI), which measures inflation at the wholesale level, declined 1.4% from year-ago in December. China's PPI for all of 2013 came in 1.9% under 2012.
The long and short of it: Inflation is not a concern in China. The greater focus is on manufacturing data and how that impacts the country's economic growth moving forward.
Follow me on Twitter: @BGrete
Need a speaker for a seminar or special event? Contact me: firstname.lastname@example.org