First Thing Today (VIP) -- February 25, 2014

February 25, 2014 12:23 AM

Good morning!

Mixed to lower price action in grain and soy futures... As of 6:30 a.m. CT, corn futures are fractionally to 1 cent lower in all contracts expect March which is fractionally higher, soybeans are 2 to 4 cents lower and wheat futures are narrowly mixed. The U.S. dollar index is modestly weaker this morning.

EPA head, in visit to N. Dakota, to discuss regulations' impact on coal, RFS... Environmental Protection Agency (EPA) Administrator Gina McCarthy will travel to North Dakota Feb. 28 to discuss carbon dioxide emissions limits for new and existing power plants and the agency's renewable fuel standard (RFS), Sen. Heidi Heitkamp (D-N.D.) announced. Heitkamp first asked that McCarthy visit North Dakota during the EPA administrator's summer 2013 confirmation process. Those calls were amplified in the fall of last year when the agency elected not to visit top coal-producing states during its 11-city listening tour to inform about its existing power plant emissions regulation. Under the standards, future coal plants would have to install carbon capture and sequestration technologies in order to meet emissions reduction limits. Many, including Heitkamp, say that those technologies are neither available nor adequately demonstrated. Another topic of discussion during the trip will be the EPA's new RFS requirements that petroleum refiners and importers blend 15.21 billion gallons of renewable fuels into the motor fuel supply in 2014. That level is significantly less than the 18.15 billion gallons specified by the Energy Independence and Security Act. Heitkamp joined 30 other senators in a Jan. 22 letter saying the proposed cuts in the agency's 2014 RFS would represent a "significant step backward."

Fannie Mae set to send more money to the public than it took in its 2008 federal rescue... Fannie said it will pay the U.S. Treasury Department $7.2 billion next month, bringing its repayments to $121.1 billion and exceeding the $116.1 billion the government spent on the company in the 2008 bailout. Freddie will report its fourth quarter results next week, but it has already sent $9 million more to Treasury than the $71.3 billion it received.

Boxed beef market starts strong... Choice boxed beef prices were $2.07 higher while Select boxes firmed $1.79 Monday. Though packers moved only 128 loads of product, the price strength will help fuel bullish cash hopes for the week after packers raised bids $2 in the Plains last week. But with showlist estimates up a combined 17,000 head from week-ago in Kansas and Texas, packers may not be overly eager to raise cash bids if movement doesn't improve.

Pork cutout continues to firm... The pork cutout value was $1.23 higher Monday as all cuts except hams and picnics were higher and they each posted just slight losses. However, movement was light at only 234.98 loads. With the average carcass price at $98.32, traders will watch movement more closely for signs retailers are starting to balk at high prices.

Overnight demand news... South Korea purchased 63,000 MT of U.S. or South American corn and 60,000 MT of South American soybean meal, but passed on a tender to buy 60,000 MT of feed wheat. Taiwan tendered to buy 83,150 MT of U.S. wheat.


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