First Thing Today (VIP) -- July 2, 2013

July 2, 2013 01:07 AM


MODEST PRICE BOUNCE OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading fractionally to 4 cents higher, soybeans are 2 to 8 cents higher, Chicago wheat is 8 to 10 cents higher, Kansas City wheat is 4 to 9 cents higher and Minneapolis wheat is mostly 7 to 8 cents higher. The U.S. dollar index is firmer this morning.

SOUTH KOREA TO DECIDE THIS WEEK ON U.S. WHITE WHEAT BAN... South Korean millers will decide this week whether to lift a ban on U.S. white wheat imports, according to a spokesperson for the South Korea Flour Dealers Association. South Korea tested 160 samples of U.S. wheat and flour and did not find any GMO wheat, the food ministry says. The ministry says it will continue to test U.S. wheat shipments.

CORN, BEAN CCI RATINGS IMPROVE... 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 crop each improved 3 points, with corn rising to 373 and soybeans firming to 367. For corn and soybeans, most of the Corn Belt states with the exception of Minnesota, posted modest improvement from week-ago.

EPA MAY BE WAITING ON NEW ADMINISTRATOR BEFORE FINAL RFS DECISIONS... President Obama's nominee to be the Environmental Protection Agency (EPA) administrator, Gina McCarthy, is facing several hurdles in the Senate. Pending is key EPA decisions regarding final 2013 Renewable Fuel Standard (RFS) volume requirements, and shortly after, decisions about 2014. Some sources signal those decisions have been on hold pending confirmation of McCarthy, but as time drags on regarding that nomination, pressure on EPA to make an RFS announcement grows. Today marked the 138th day that Bob Perciasepe has been acting EPA administrator, breaking a 40-year-old record of 136 days between the first and second EPA administrators, William Ruckelshaus and Russell Train, respectively.

WTO ISSUES DECISIONS IN U.S. CASES... A World Trade Organization (WTO) dispute panel has rejected India's attempt to have a U.S. case targeting India's import restrictions on agricultural products dismissed on procedural grounds. The three-member panel rejected India's claims that the U.S. failed to identify the specific Indian import restrictions at issue and to provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly, as required by WTO dispute settlement rules. The panel will now proceed to examine U.S. claims that India violated WTO rules by banning imports of various agricultural products from the U.S., including poultry meat and chicken eggs, since at least February 2007, supposedly to prevent outbreaks of avian influenza. Meanwhile, a WTO panel has issued a final ruling condemning China's imposition of antidumping (AD) and countervailing duties (CV) on imports of U.S. chicken broiler products. The final ruling, circulated to the U.S. and China June 25, maintains the findings of the panel's May 8 interim report backing U.S. claims against the Chinese Ministry of Commerce's September 2009 decision to initiate the AD and CV investigations and the subsequent proceedings that led to the imposition of duties in August and September of the following year. The final ruling is due to be made public by the end of July. China will then have 60 days to decide whether to file an appeal.

UKRAINE GRAIN EXPORTS RISE 4.7% IN 2012-13... Ukraine exported 22.82 MMT of grain in 2012-13, according to the country's ag ministry, a 4.7% rise from 2011-12. Of the total, corn exports accounted for 13.5 MMT, wheat exports were 6.8 MMT and barley exports hit 2.1 MMT.

ICAC LOWERS GLOBAL COTTON PRODUCTION, STOCKS FORECAST... The International Cotton Advisory Committee (ICAC) lowered its 2013-14 global cotton production forecast by 140,000 MT to 24.95 MMT and trimmed its global cotton stocks projection by 130,000 MT to 18.51 MMT. China currently holds around half of global cotton supplies and that's expected to rise to around 60% by the end of 2013-14.

BOXED BEEF MARKET CONTINUES TO SLUMP... Boxed beef prices were 86 cents (Choice) to $1.37 (Select) lower Monday and packers moved only 137 loads of product on the day. If the boxed beef market continues to slump, it will be hard for the cash cattle market to put in a short-term low and to convince traders to actively buy cattle futures.

PORK CUTOUT DROPS... The pork cutout value was $1.01 lower Monday as all cuts except butts and hams were lower. In addition to the price pressure, packers moved only 226 loads of product on the day. Given recent, strong price gains and the tendency for a seasonal top around this timeframe, traders are monitoring the pork product market closely.

OVERNIGHT DEMAND NEWS... South Korea purchased 179,000 MT of corn -- 110,000 MT Black Sea origin, 69,000 MT Brazilian. Egypt tendered to buy optional origin wheat. Results of the tender will be known later this morning. Japan is skipping its regular wheat tender this week.


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