First Thing Today (VIP) -- January 31, 2013

January 31, 2013 12:39 AM
 

GOOD MORNING!

GRAINS DOWN ON PROFIT-TAKING... As of 6:30 a.m. CT, corn futures are steady to 3 cents lower in most contracts, soybeans are 5 to 9 cents lower, Chicago wheat is 2 to 3 cents lower, Kansas City wheat is 1 to 2 cents lower and Minneapolis wheat is mixed. The U.S. dollar index is anchored near unchanged this morning.

UKRAINE REPORTEDLY STOPPING TWO WHEAT SHIPMENTS... Ukraine's ag ministry is reportedly urging exporters to halt the shipment of two cargoes of wheat and refrain from additional exports as it would violate the current agreement to suspend wheat shipments, according to local news agency Latifundist. "As for loading in Mykolayiv and Kherson (two Black Sea ports), these cases are a gross violation of the memorandum and the ministry will take every effort to ensure that these vessels do not leave Ukraine," Latifundist quoted first deputy farm minister Ivan Bisyuk as saying.

RUSSIA TO DISCUSS GRAIN IMPORT DUTY FRIDAY... Russian Deputy Prime Minister Arkady Dvorkovich will reportedly discuss what the country plans to do with its 5% grain import duty tomorrow. As we reported last week, Russian officials are considering lifting the import duty on grains amid rising domestic prices. Dvorkovich has previously stated he does not support lifting the grain import duty, but Ag Minister Nikolai Fyodorov says he believes the duty may be lifted. Meanwhile, Russian Deputy Ag Minister Ilya Shestakov says grain imports from Kazakhstan are attractive for some regions at current prices and says the country will likely import 1.2 MMT of grain in 2012-13.

WEEKLY EXPORT SALES REPORT OUT THIS MORNING... For the week ended Jan. 24, traders expect: corn sales between 150,000 and 300,000 MT; wheat sales between 350,000 and 550,000 MT; soybean sales between 650,000 and 850,000 MT; soymeal sales between 150,000 and 250,000 MT; and soyoil sales between 15,000 and 25,000 MT.

USDA CONFIRMS NO SHIFT IN REPORT TIMES... USDA report release times will not change despite a coming reduction by CME Group to daily trading hours for grain and oilseed futures and options. USDA Chief Economist Joe Glauber said USDA chose the current 11 a.m. CT release time after considerable consultations with the grain exchanges, farmers, traders and others and said "we have no further plans to change our current release schedule." Our sources signaled this was the case almost immediately after the CME Group intentions to shorten the trading day were announced. Some traders want the USDA reports to be released while markets are closed or for trading to briefly stop when USDA issues a major grain report.

SENATE TO VOTE THURSDAY ON DEBT LIMIT SUSPENSION BILL... The bill would suspend the debt limit through May 18, but really late July when considering actions the Treasury Department could take to avoid hitting the limit. GOP amendments would prevent government shutdowns while another would codify the requirement that Congress find cuts commensurate with the amount spent to extend the debt limit. Other amendments will be offered. Most will fail. The House passed the debt limit measure on a 285-144 vote on Jan. 23.

CHINA COTTON ACREAGE COULD DROP 4.5%... Chinese cotton plantings are likely to decline 4.5% this year as other crops offer more attractive returns to farmers, according to the China Cotton Association. The association expects Chinese farmers to plant 4.67 million hectares (11.5 million acres) to cotton this year.

CASH CATTLE TRADE HIGHER, BUT NOT AS HIGH AS SOME EXPECTED... Cash cattle actively traded at $125 in the Plains Wednesday, which was $2 to $3 above last week's cash activity. Still, that wasn't as high as some traders had hoped for, which caused live cattle futures to slip into the close. Given that the February live cattle contract is trading at a $3 premium to this week's cash trade, buying interest may be limited the remainder of the week.

POSITIVE PORK CUTTING MARGINS SHORT-LIVED... The pork cutout value was $1.12 lower Wednesday, which drops cutting margins for most pork plants back below breakeven after they briefly turned positive. Cash hog bids are expected to be mixed across the Midwest today on varied packer demand.

OVERNIGHT DEMAND NEWS... South Korea purchased 55,000 MT of European non-GMO soybeans and 110,000 MT of feed wheat (likely Indian). Taiwan bought 78,670 MT of U.S. wheat. Iraq tendered for at least 50,000 MT of optional origin wheat.

 

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