DROP IN CROP RATINGS FUELS GAINS IN GRAINS OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading mostly 11 to 14 cents higher, soybeans are 19 to 23 cents higher, Chicago wheat is mostly 8 to 10 cents higher, Kansas City wheat is mostly 5 to 9 cents higher and Minneapolis wheat is 3 to 6 cents higher. The U.S. dollar index is under pressure this morning.
CORN, BEAN CCI RATINGS DECLINE... When USDA's weekly crop condition ratings are plugged into the weighted Pro Farmer Crop Condition Index (0 to 500 point scale), the corn and soybean crops each declined 4 points. Corn now stands at 371, while soybeans have a 363 CCI rating. For corn, declines in Iowa, Nebraska, Kansas and Ohio more than offset modest increases in Illinois, Indiana and Minnesota. For soybeans, declines in Ohio, South Dakota and Nebraska more than offset modest gains in Iowa, Illinois, Indiana and Minnesota.
HOUSE GOP LEADERS WILL TAKE TIME TO ADVANCE FARM BILL CONFERENCE, DESPITE STABENOW PUSH... Senate Ag Chairwoman Debbie Stabenow (D-Mich.) on Monday noted the lack of legislative days remaining means the House must quickly send its farm program-only farm bill to the Senate so staffers could begin to work on differences. She added that nutrition program funding must be in the final measure. A bill without the Supplemental Nutrition Assistance Program/food stamps is one that "we could not pass that through the Senate nor would the president of the United States sign that kind of a bill," Stabenow said. House GOP leaders have said they may hang on to their measure until they can revise a nutrition title they removed from the bill. Stabenow finally acknowledged what few Democratic lawmakers have said to date: funding for SNAP could continue without farm bill reauthorization. But she warned food stamp funding could be "vulnerable" to significant cuts and fights in the appropriations process.
STABENOW WILL NOT SUPPORT A SIMPLE EXTENSION OF 2008 FARM BILL... But she said the same thing last year before finally agreed to an extension. Importantly, Stabenow said she is open to a negotiation just between the chairmen and ranking members of the agriculture committees if no conference can be convened. "Given the strange process we have had in the House, I will support any fair and open process that gets us a bipartisan, comprehensive farm bill," she said.
HOUSE APPROPRIATORS UNLIKELY TO RESTRICT AID TO EGYPT... House appropriators are reportedly leaning against adding language to their State-Foreign Operations spending bill that would waive any restrictions on aid to Egypt or allow the administration to waive prohibitions on aid to countries where the military has seized power from an elected government. The House Appropriations Subcommittee on State and Foreign Operations could mark up its Fiscal 2014 spending bill later this week, with the bill in front of the full committee next week.
JAPAN FINDS SUBSTITUTES FOR U.S. WESTERN WHITE WHEAT... Japan is buying U.S. club white wheat, U.S. SRW wheat and Australian premium white wheat as substitutes for U.S. western white wheat, the head of the country's wheat import department told Dow Jones newswire. He says USDA must complete its investigation into the GMO wheat discovery and the two countries must agree to a strict pre-shipment testing protocol before Japan will resume shipments of U.S. western white wheat. Meanwhile, Japanese ag officials are in Oregon this week to meet with wheat industry groups and then they will head to Washington, DC, for additional meetings, according to The Oregonian.
RUSSIA'S KEY EXPORT REGION DOUBLES WHEAT OUTPUT... Russia's largest Black Sea ag production region of Krasnodar harvested a wheat crop of 7.1 MMT this year compared to 3.4 MMT last year, according to the country's ag ministry. Through July 15, Russia had harvested 20 MMT of wheat in total and hopes its wheat harvest will total at least 50 MMT this year.
INDIA WILL HAVE GRAIN EXPORT SURPLUS AMID HIGHER PRODUCTION... India's grain production is likely to top the previous two years amid improved rains through the monsoon season and forecasts calling for normal rainfall through August. Meanwhile, Farm Minister Sharad Pawar says the country will have surplus grains to export despite the expected start of a domestic food security program.
TRADERS ANTICIPATING BOXED BEEF, CASH CATTLE LOW... While the boxed beef and cash cattle markets are struggling to put in short-term lows, traders feel a seasonal bottom can't be far off. As a result, traders are keeping nearby live cattle futures at a premium to the cash market. But until there are signs of a low in cash fundamentals, traders will be hesitant to build in too much premium.
SLUGGISH START FOR PORK PRODUCT MARKET... The pork cutout value was 55 cents lower Monday and packers moved only 238.4 loads of product on the day. With the product market sputtering, packers will continue to lower cash hog bids and some may cut back on kill hours instead of actively competing for a tight supply of market-ready hogs.
OVERNIGHT DEMAND NEWS... Taiwan tendered to buy 60,000 MT of U.S. or Brazilian soybeans. Japan is seeking 112,176 MT of wheat in its weekly tender.