What Traders are Talking About:
Overnight highlights: As of 6:15 a.m. CT, corn futures are trading fractionally to 1 cent higher, soybeans are 1 to 4 cents higher in all but the August contract which is 4 cents lower and wheat futures are 2 to 4 cents lower. Given non-threatening weather and bearish attitudes, it will be hard for corn and beans to maintain corrective gains through the day session. Cattle and hog futures are expected to open with a firmer tone this morning.
* Weather forecast unchanged. Forecasts continue to call for below-normal temps and above-normal precip across the bulk of the Corn Belt. The National Weather Service forecasts for Aug. 12-16 and Aug. 14-20 now suggest the current weather pattern will persist into the the second half of the month. With forecasts for the non-threatening conditions to persist, it's going to be hard for corn and soybeans to build any kind of upward momentum -- even for a corrective bounce -- as traders feel weather will be beneficial for filling crops.
The long and short of it: Weather is seen as non-threatening now, but if forecasts continue to call for below-normal temps into September, it could eventually get to the point where there's some concern with a potential early frost.
* EPA announces final 2013 RFS requirements. The Environmental Protection Agency (EPA) on Tuesday finally released the final requirements for blenders under the Renewable Fuel Standard (RFS). EPA kept the RFS mandate at 16.55 billion gallons for 2013, but extended the compliance deadline by 4 months to June 30, 2014. The cellulosic biofuel mandate for 2013 was cut to 6 million gallons. EPA also pledged to use "flexibilities" to help refiners with meeting RFS mandates for 2014.
The long and short of it: By showing flexibility within the mandate, EPA is clearly indicating the administration wants to stick with renewable fuel program. Big oil will now put pressure on Congress for reductions in the program.
* China clears first Argy GMO corn shipment. The first commercial shipment (60,000 MT) of corn from Argentina to China has been approved, according to Argentina's ag minister. The shipment arrived in southern China in mid-July and apparently made it through the quarantine process. The shipment was purchased by state-run grain firm COFCO and then sold to two Chinese feedmills.
The long and short of it: This clears the way for more corn trade between Argentina and China, though export sources don't expect much business until the 2013-14 Argentine corn crop is ready. And a farmer/trader source in Argentina says Argentine farmers will plant "much less" corn for 2013-14.
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