LIGHT AND CHOPPY PRICE ACTION OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are steady to 3 cents higher and wheat futures are narrowly mixed. The U.S. dollar index is sharply higher this morning.
VILSACK OUTLINES SEQUESTER IMPACTS... Employee furloughs could mean that workers with the Farm Service Agency and Rural Development offices will be off work four to seven days or even 10 days, according to USDA Secretary Tom Vilsack. While the length of any furloughs has not yet been determined, Vilsack told members of the House Ag Appropriations subcommittee the two agencies will see most of the impact. "Obviously, if folks are furloughed, then work doesn't get done," he said. The Natural Resources Conservation Service (NRCS), however, has averted the furloughs by leaving some 400 vacancies unfilled, Vilsack said at a hearing on the Fiscal Year (FY) 2014 budget plan. However, Vilsack said the decisions on furloughs will not come until flexibility requested by USDA has been acted on by the Office of Management and Budget (OMB). Another potential impact will be that some 15,000 low-income elderly and disabled residents in rural areas could lose their rental subsidies due to the sequester impacts.
VILSACK, GLAUBER ASKED ABOUT POTENTIAL BUBBLE IN U.S. FARMLAND... Land values and the possibility of a "bubble" was one of the topics addressed Tuesday during a House Ag Appropriations Subcommittee hearing on the FY 2014 Agriculture budget. Rep. Jeff Fortenberry (R-Neb.) asked USDA Secretary Tom Vilsack about the matter. Vilsack noted that, "I don’t think we are faced with nearly the same circumstance we were faced with in the 80s where people were over-leveraged." USDA Chief Economist Joe Glauber added that higher farmland prices are "fully consistent with the fact that we have had very strong farm income and low interest rates. I think both of those have been very big factors in seeing the sorts of increases that we’ve seen, particularly in the Midwest."
CHINA BIRD FLU UPDATE... Chinese officials have now identified 77 cases of the H7N9 bird flu virus, with 16 of those resulting in deaths. The government has warned the number of infections is likely to rise as the source of the disease has not been identified. Meanwhile, the World Health Organization says not all of those infected with H7N9 have had contact with poultry, but no human-to-human spread of the virus has been confirmed.
EASTERN AUSTRALIAN FIGHTING DRYNESS... Conditions are excessively dry, especially in New South Wales and Victoria, as producers in eastern Australian start planting the 2013-14 wheat crop. And very little relief appears to be on the horizon as the Australian Bureau of Meteorology forecast calls for average to below-average rainfall across southern areas of eastern Australia over the next three months. Conditions are also dry in Western Australia, but that's not a major concern at this point.
RUSSIAN PM PUTS GRAIN CROP AT 90 MMT TO 95 MMT... Russia should produce 90 MMT to 95 MMT of grain this year if weather is favorable, according to Prime Minister Dmitry Medvedev. The forecast is a little confusing since the country's ag ministry narrowed is production range to 90 MMT to 92 MMT April 3.
NO FOLLOW-UP CASH CATTLE SALES... Feedlots throughout the Plains resisted pulling the trigger on cash cattle sales after light activity at $125 in Texas and Iowa Monday. Most feedlots still have hopes of getting firmer prices compared with last week's $127 trade in the Plains. But unless boxed beef movement sharply increases, packers are unlikely to raise cash cattle bids as they continue to work with deeply negative margins.
PORK PRICES FIRM AGAIN, MOVEMENT PICKS UP... The pork cutout price firmed 60 cents Tuesday as strong gains in loins, butts, picnics and hams offset hefty losses in ribs and bellies. More importantly, product movement improved to 422.7 loads. If packers start actively moving pork at higher prices it would go a long way toward easing traders' concerns with demand.
OVERNIGHT DEMAND NEWS... Japan bought 1,960 MT of feed wheat and 36,705 MT of feed barley. Japan is seeking 105,425 MT of wheat in its weekly tender.