CORN AND WHEAT WEAKER, BEANS FIRMER... As of 6:30 a.m. CT, corn futures are trading mostly 2 to 4 cents lower, soybeans are 1 to 7 cents higher, Chicago wheat is 1 to 3 cents lower, Kansas City wheat is steady to 2 cents lower and Minneapolis wheat is mostly 1 to 2 cents lower. The U.S. dollar index is modestly weaker this morning.
DIRECT PAYMENT ELIMINATION COULD BE PART OF DEMOCRATIC SEQUESTER ALTERNATIVE... Aides have said elements of an upcoming package of Democratic leaders in Congress to avoid across-the-board (sequester) budget cuts on March 1 could reflect a plan offered last week by Rep. Chris Van Hollen (D-Md.), the top Democrat at the House Budget Committee. That measure would eliminate direct payment subsidies to the farm industry, scrap tax preferences used by oil-and-gas companies and implement a new minimum tax rate on people making seven figures annually -- the proposal commonly known as the "Buffett Rule." Any Democratic plan along those lines would face strong opposition in the House and would not likely see its way through Congress.
ABARES INCHES UP AUSSIE WHEAT CROP ESTIMATE... The Australian Bureau of Agriculture and Resource Economics and Sciences (ABARES) modestly increased its 2012-13 Australian wheat crop estimate to 22.077 MMT from 22.035 MMT previously. ABARES left its wheat export forecast unchanged at 20.9 MMT.
KAZAKHSTAN GRAIN EXPORTS TO RUSSIA BUILDING... Kazakhstan has seen grain exports to Russia increase recently and shipments are expected to remain strong in coming months, the head of the country's grain lobby told Reuters. The official says he expects Russia to import around 200,000 MT of grain from Kazakhstan through the end of 2012-13. In addition to logistical advantages, Kazakhstan can export grain duty-free to Russia. On Monday, Russia's deputy prime minister said he expects the country to lift its import duty for all grain imports by the end of March.
SLUGGISH START FOR BOXED BEEF MARKET... Choice boxed beef prices firmed 60 cents Monday, but Select cuts were 47 cents lower and more importantly, packers moved only 137 loads of product on the day. Until there are strong signs of a short-term low in the product market, buying interest will be limited in live cattle futures, especially with nearby futures trading at a premium to last week's cash trade.
LIMITED DEMAND FOR CASH HOGS... With the pork cutout value 52 cents lower Monday and cutting margins buried deep in the red, packer demand for cash hogs will remain limited. As a result, the cash hog market will remain weak. But with nearby lean hog contracts trading at a discount to the cash index, selling interest in futures should be limited.
OVERNIGHT DEMAND NEWS... South Korea purchased 55,000 MT of feed wheat -- likely Indian origin. Bangladesh bought 50,000 MT of Indian wheat. Japan is seeking 96,538 MT of U.S. and Canadian wheat in its weekly tender. Algeria tendered for 50,000 MT of optional origin milling wheat.