First Thing Today (VIP) -- January 31, 2014

January 30, 2014 11:57 PM

Good morning!

Corn weaker, beans mixed and wheat firmer this morning... As of 6:30 a.m. CT, corn futures are trading around a penny lower, soybeans are narrowly mixed and wheat futures are 1 to 2 cents higher. The U.S. dollar index is holding near unchanged after choppy, two-sided trade overnight.

Senate farm bill vote Tuesday, Feb. 4... Senate Majority Leader Harry Reid (D-Nev.) announced the Senate's vote on the farm bill will come next Tuesday, following a vote Monday to invoke cloture. The Senate is widely expected to clear the measure and White House spokesman Jay Carney on Wednesday said the president backs the 2014 farm bill (HR 2642). "If the bill as it is currently designed reaches his desk, he would sign it," Carney said. Reid said the cloture vote would come at 4:30 p.m. CT Monday and the vote on adoption of the conference committee report at 1:15 p.m. CT Tuesday. The report was adopted by the House in a bipartisan 251-166 vote on Wednesday.

GOP releases immigration reform principles... House Speaker John Boehner (R-Ohio) laid out the key principles House Republicans will pursue on immigration reform, including border security and interior enforcement, entry-exit visa tracking system, employment verification and issues on temporary workers. Of note, there was "concern" expressed on temporary ag workers, with the principles stating, "It is imperative that these temporary workers are able to meet the economic needs of the country and do not displace or disadvantage American workers." Boehner said the House will not go to conference on the Senate's omnibus immigration plan, but will push the above reforms.

Cargill to idle North Carolina soy crushing facility this spring... Cargill announced Thursday it's idling its Raleigh, North Carolina, soy processing plant "later this spring" without giving a specific date, citing lower demand for U.S. soybean meal. The plant will continue to buy soybeans during the closure and will restart operations if conditions change.

Keystone XL pipeline analysis expected today... The State Department could release its final environmental analysis on the controversial Keystone XL pipeline as early as today. The report will include the findings of a years-long study into the environmental impact of the $5.4 billion construction project, which would carry oil from Canadian refineries to the Gulf Coast. Reports note that environmental groups who opposed construction of the pipeline would likely be disappointed with the results. While the report will include some modest changes that respond to concerns raised by environmentalists, it is still expected to find that the pipeline would have only a minimal impact on carbon emissions.

Bernanke's time as head of the Fed coming to an end... Today is Ben Bernanke's last day as Chairman of the Federal Reserve after eight years in the job. Writing in the New York Times, long-time Wall Street executive Steven Rattner believes that Bernanke has been "one of the finest chairmen in the institution's hundred year history." True, he "missed the housing bubble," "failed to detect the onset of recession" and was lax in asserting the Fed's regulatory responsibilities, but he "played a central role in averting a financial meltdown and lifting the nation out of recession."

CME lowers wheat margins... Effective at the close of business today, CME Group says initial margins required for speculators to trade wheat futures will be set at $1,890, which is down 15.2% from the current $2,228.

Smaller U.S. cattle herd, but herd rebuilding is well underway... USDA's Cattle Inventory Report this afternoon will show the U.S. cattle herd contracted for a seventh consecutive year. However, traders anticipate more than a 3% rise in the number of beef heifers being held back for breeding as there’s increasing incentive to rebuild the beef herd.

Waiting on active cash cattle trade... So far, only scattered, light cash cattle trade has been reported at lower prices in the Plains. While these initial sales are considered too light to be a true market test, cash cattle trade is eventually expected to fall from last week's record $147 to $150 prices.

Pork cutout rises, but movement slows... The pork cutout value firmed $1.18 Thursday amid sharp gains in bellies, hams and loins, but movement slowed to 253.12 loads. While the recent surge to record wholesale beef prices is encouraging packers to buy more pork for late winter/early spring features, pork prices are strong enough to keep retailers from getting too aggressive with pork buys, especially on days in which prices are sharply higher.

Overnight demand news... Lebanon tendered to buy 25,000 MT of optional origin milling wheat.


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