First Thing Today (VIP) -- February 11, 2014

February 11, 2014 12:40 AM

Good morning!

Corn and wheat favoring the upside, wheat lower this morning... As of 6:30 a.m. CT, corn futures are trading steady to 1 cent higher in most contracts, old-crop soybeans are 5 to 8 cents lower while the November contract is around 3 cents lower and wheat futures are 1 to 3 cents higher. The U.S. dollar index is under light pressure this morning.

Conab lowers Brazilian soybean, corn crop estimates... Conab, the statistical agency of the Brazilian government, trimmed its soybean crop estimate to 90.01 MMT from 90.31 MMT previously and cut its corn crop estimate to 75.47 MMT from 78.97 MMT last month. The head of Conab says hot, dry weather in southern Brazil could impact next month's crop estimates, but that wasn't the reason this month's forecasts were lowered.

ABARES raises wheat crop estimate... The Australian Bureau of Agriculture Resource Economics and Sciences (ABARES) raised its Aussie 2013-14 wheat crop estimate to 27.013 MMT from 26.213 MMT previously given a strong Western Australia crop. In Tuesday's report, USDA left is Australian wheat crop estimate at 26.5 MMT.

House GOP seeking one-year debt limit extension with military pension cut repeal... House Republican leaders are pushing for a vote Wednesday on a one-year extension of the debt limit that also would include a repeal of a cut in pensions for younger military veterans and create new spending reductions in other mandatory programs in 10 years. The debt limit extension would last until March 2015 and the repeal of the cost-of-living adjustment for veterans would be paid for by extending sequestration for other mandatory programs for one year, to 2024. Michael Steel, a spokesman for House Speaker John Boehner (R-Ohio), said Republicans do not expect the Senate to strip away the military pension provision, assuming the measure heads to the Senate. Of note, House Minority Whip Steny Hoyer of Maryland said he was "not happy with it" but would not rule out voting for the proposal. The last debt limit extension expired Feb. 7 and the Treasury Department has said the extraordinary measures used to stave off the need for new borrowing authority will run out Feb. 27.

Freight provision in 2014 Farm Bill... A provision included in the new farm bill would require an updated study of rural transportation issues, pushed by rural customers for farm products, coal for power plants and other shippers who believe they suffer from lack of effective rail rate competition. The farm bill also authorizes USDA to make complaints to or to petition the Surface Transportation Board, which has been studying a request by industrial firms to require competition at rail switching terminals. Railroads say more stringent regs could hurt their ability to reinvest in new track and equipment.

China raises minimum price for rice... China raised the minimum price it will pay for rice this year by 2.3% to 3.3% to support farmers and encourage production. The National Development and Reform Commission says the minimum price for rice will be 2,700 yuan to 3,100 yuan ($445 to $512) per ton.

Mixed start for wholesale beef prices... Choice boxed beef prices were 39 cents higher Monday, while Select cuts dropped 18 cents as packers moved 121 loads of product on the day. While that performance wasn't overly impressive, at least prices didn't plunge sharply. Before traders have confidence a short-term low is in the works, however, they will want to see firmer prices and a pickup in movement.

Pork cutout firms... The pork cutout value was 37 cents higher Monday as all cuts except hams were firmer. While packers moved only 263.02 loads of product on the day, their margins are strong enough to keep demand for cash hogs strong. Cash hog bids are expected to be steady to firmer at most Midwest locations today, though some weaker bids are likely after a mixed cash market Monday.

Overnight demand news... Exporters reported no tenders or purchases.


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