First Thing Today (VIP) -- July 19, 2013

July 19, 2013 01:07 AM
 

GOOD MORNING!

CORN LOWER, BEANS FIRMER AND WHEAT MIXED OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 3 cents lower, soybeans are 3 to 12 cents higher, Chicago and Kansas City wheat are steady to 4 cents higher and Minneapolis wheat is narrowly mixed. The U.S. dollar index is weaker this morning.

SENATE ADVANCES TO CONFERENCE ON FARM BILL... By unanimous consent, the Senate called up the House-passed bill (HR 2642) and inserted the text of its own version, setting up a conference with the House. Senate Ag Chairwoman (D-Mich.) asked that the presiding officer appoint a Senate delegation of 12 conferees, with seven Democrats and five Republicans. Senate and House lawmakers have begun informal talks on how to resolve differences between the two measures. House Agriculture Chairman Frank Lucas (R-Okla.) continued to work on revising the nutrition title that was removed from the House farm bill. The Senate-passed bill includes SNAP/food stamp provisions, while the House version does not. On Thursday, Speaker John Boehner (R-Ohio) said he had no definite time frame for addressing SNAP. "There was a conversation yesterday with a group of members on the food stamp issue, and I’m optimistic that we’ll be able to put something forward -- hopefully sooner rather than later," said Boehner.

McCARTHY CONFIRMED AS ADMINISTRATOR OF EPA... Gina McCarthy on Thursday was confirmed as Environmental Protection Agency (EPA) administrator on a 59-40 Senate vote. She succeeds Lisa Jackson, who left the position in mid-February after serving all four years of Obama's first term. Bob Perciasepe was acting administrator during the five months since Jackson's departure as the Senate pondered McCarthy's confirmation. Key EPA issues ahead include rulemakings to limit power plant emissions, address mountaintop mining, issue guidance on hydraulic fracturing fluids, manage power plant coal ash, and limit stormwater runoff -- plus volume requirements for the 2013 and 2014 Renewable Fuels Standard (RFS).

OBAMA ENERGY/CLIMATE ADVISER: RFS REPEAL CALLS ‘SHORT-SIGHTED’... Repeal of the RFS would be a "short-sighted" move and EPA can implement the RFS in a way that provides the benefits of the program while still addressing challenges that currently exist, according to Heather Zichal, deputy assistant to the president for energy and climate change. "Calls to repeal the Renewable Fuels Standard are nothing but short-sighted," Zichal told a Washington event held by the Advanced Biofuels Association and the Washington publication "The Hill." The RFS is a key component of the Obama administration’s efforts to cut oil imports and trim greenhouse gas emissions, Zichal said, calling it the "backbone of our policy." In addition, she said the RFS is an "opportunity to develop a new competitive industry" and the administration remains committed to the policy in the face of "RFS battles that we know are ahead of us." While the oil industry and others have been raising questions about the mandates under the RFS, Zichal indicated EPA can make things work. "We are confident that EPA can implement the statute in a way that continues to provide the benefits that Congress envisioned while addressing challenges in the fuels marketplace," Zichal stated.

CATTLE ON FEED REPORT OUT THIS AFTERNOON... Traders are expecting all three categories in USDA's monthly Cattle on Feed Report to come in under year-ago. Based on the average pre-report guesses, traders see On Feed at 97.0%, Placements at 94.9% and Marketings at 94.7% of year-ago.

STILL WAITING ON CASH CATTLE TRADE... Bids and asking prices for cash cattle in the Plains remain far apart, suggesting active cash cattle trade won't likely be seen until this afternoon -- likely after USDA's Cattle on Feed Report. If cattle futures build on Thursday's gains, that could be enough to swing cash negotiations in feedlots' favor.

PORK PRICE SLIDE CONTINUES... The pork cutout value was 89 cents lower Thursday, extending the slide in pork prices from the seasonal peak. Until the pork product market puts in a low, the cash hog market will remain under pressure as packers work to keep margins from falling deep in the red.

OVERNIGHT DEMAND NEWS... South Korea purchased 165,000 MT of corn (Black Sea and South African) and 60,000 MT of feed wheat (likely Black Sea).

 

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