First Thing Today (VIP) -- December 28, 2012

December 28, 2012 12:31 AM

GOOD MORNING! Corn futures chopped in a narrow range overnight and as of 6:30 a.m. CT, most contracts are steady to 3 cents higher. Soybean futures are enjoying slightly stronger gains of 4 to 7 cents after seeing firmer trade most of the overnight session. Wheat futures are mostly 2 to 4 cents higher at all three locations. The U.S. dollar index is firmer this morning, as is crude oil.

OBAMA TO HOST MEETING TODAY WITH CONGRESSIONAL LEADERS...The White House meeting this afternoon will be to lay the groundwork to get a fiscal cliff agreement before the end of the year. The president called the four congressional leaders (two each from both political parties and chambers) from Hawaii Wednesday night. Meanwhile, GOP leaders called the House back for a session starting at 1 p.m. CT and votes at 5:30 p.m. CT Sunday, without specifying what might be voted on. Most observers are focusing on the Senate, expecting Democratic leaders to offer a compromise package designed to attract both Democratic and Republican votes. "The House may be in session through Wednesday, Jan. 2," House Majority Leader Eric Cantor of Virginia said in a notice. "As a reminder, the 113th Congress will convene at noon on Thursday, Jan. 3."

TALKS UNDERWAY TO AVERT MAJOR PORT STRIKE... Talks resumed this week regarding a 1960s contract agreement to pay royalties on containers to union port workers based on cargo weight. Maritime Alliance wants limit these royalties that were first enacted to compensate unions for the loss of hours and workers with the introduction of automation. These royalties in 2011 totaled $1.8 billion. If no agreement is reached by midnight ET Saturday, International Longshoremen's Association, which represents 14,650 workers at 14 ports, may strike. Half of the nation's maritime trade moves through these ports, or around $454 billion a year, that stretch from Boston to Houston, according to Beacon Economics.

ARMY CORPS RELEASES LAKE WATER TO KEEP MISSISSIPPI RIVER OPEN... Following news that Mississippi River water levels are falling faster than expected due to ice formation, the U.S. Army Corps of Engineers stepped up its efforts to keep the river open for barge traffic. On Thursday, the Army Corps released water from a southern Illinois lake to flow into the Mississippi River and it resumed work on removing a river rock formation near Thebes, Illinois, after a four-day break for the holidays.

ARGY BEAN ACRES LOST TO FLOODING OFFSET BY WIDE SEEDINGS... Yesterday, the Buenos Aires Grains Exchange left its soybean planted acreage estimate unchanged at 19.7 million hectares, saying that acres lost to flooding this year should be offset by seedings in outlying areas of the country that have benefited from more favorable moisture.

WEEKLY EXPORT SALES REPORT OUT THIS MORNING... For the week ended Dec. 20, traders expect: corn sales between 150,000 and 300,000 MT; wheat sales between 500,000 and 700,000 MT; soybean sales between 100,000 and 300,000 MT; soymeal sales between 200,000 and 300,000 MT; and soyoil sales between 0 and 20,000 MT.

BOXED BEEF MARKET CONTINUES TO STRENGTHEN... Very light cash cattle sales took place yesterday at $127 in Nebraska, which is up a buck from the bulk of last week's trade. But trade has yet to pick up elsewhere. Boxed beef prices rose 2 and 30 cents for Choice and Select cuts, respectively, yesterday and movement was again strong. This plus much tighter showlists could give feedlots some leverage in cash cattle negations, but yesterday's lower close in live cattle futures signals higher trade is in no way a "sure thing."

PACKER PROFIT MARGINS SLIP BACK INTO THE RED... Cash hog bids were steady to firmer yesterday, which along with a $1.14 slide in the pork cutout value yesterday, helped pull packer profit margins back into the red. This could limit packer demand going forward and may cause traders to favor the downside as they ready positions for the Quarterly Hogs & Pigs Report to be released this afternoon. The report is expected to show All Hogs & Pigs at 99.1% of year-ago, Kept for Breeding at 99.3% and Kept for Marketing at 99.1% of year-ago levels.

OVERNIGHT DEMAND NEWS... Jordan tendered to buy 15,000 to 50,000 MT of feed wheat barley for immediate shipment.

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