CORRECTIVE GAINS OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading mostly 2 to 3 cents higher, soybeans are fractionally to 2 cents higher in old-crop contracts and 7 to 10 cents higher in new-crop contracts, Chicago wheat is fractionally to 2 cents higher, Kansas City wheat is mostly 2 to 3 cents higher, while Minneapolis wheat is steady to 1 cent lower. The U.S. dollar index is modestly weaker this morning.
USDA JULY CROP REPORTS, NO HOUSE FARM BILL ACTION THIS WEEK... Congress returns from the July Fourth recess as the House considers at least one Fiscal Year 2014 appropriations measure, while the Senate's focus will be on judicial nominations. Of note will be a Senate Agriculture Committee hearing on a Chinese company's proposed purchase of Smithfield Foods, a House hearing on the Obama administration's delay of part of the health care law and a GOP House member closed-door meeting on immigration reform. What is not on this week's list is the House farm bill -- although House Majority Leader Eric Cantor (R-Va.) last Friday put it on the July calendar. On Thursday, USDA will issue its July Crop Production and Supply & Demand Reports. The S&D tables will incorporate the new planted and harvested acreage figures from the June Acreage Report, while the Crop Production Report will feature the first survey-based estimates for all wheat and spring wheat production.
HOT TEMPS AND RAIN EARLY THIS WEEK, SEASONAL TEMPS LATER... The hot and humid conditions seen this weekend across the Corn Belt will continue early this week. Along with those conditions, there are storm chances through mid-week. As the storm fronts pass, slightly cooler (seasonal) temps will follow. Traders view the forecast as non-threatening and generally favorable for crop development. While current conditions are seen as non-threatening, the forecast will be watched closely as the National Weather Service outlook for July 13-17 calls for above-normal temps across much of the Corn Belt.
JAPAN AIMING FOR AUGUST RESTART OF U.S. WHITE WHEAT PURCHASES... Japan is hoping to resume purchases of U.S. western white wheat sometime in August, according to a Reuters story citing industry sources. One unnamed source says, "(Japan) is intending to resume imports as soon as possible, as long as safety can be assured. But next week or the week after that is too difficult scheduling-wise, so they're saying they'd like to resume in August." Toru Hisazome, a farm ministry official involved in wheat trading told Reuters, "(When buying begins) depends on progress of talks with the U.S. There are some conditions." The farm ministry has asked individual sellers to look into taking out insurance to cover against future GMO discoveries, three sources told Reuters.
IKAR CUTS RUSSIAN GRAIN, WHEAT FORECASTS... Dry conditions in the Volga and Urals regions have caused the Institute for Agricultural Market Studies (IKAR) to cut its Russian grain forecast to 91.9 MMT from 94 MMT previously. The bulk of the reduction was to the wheat crop, which is now forecast at 52.4 MMT versus 54 MMT previously. While these regions have been dry, rains moved in overnight and will continue today.
CHINA TO CUT SPENDING... Chinese government agencies have been ordered to cut expenditures by 5% by the Finance Ministry, according to a story by state-run Xinhua news agency. The Chinese government is encouraging agencies to use funds more efficiently as the country tries work out of its economic slumber.
FOCUS ON BOXED BEEF DEMAND... Traders will closely monitor boxed beef demand coming out of the weekend as an indicator of holiday beef sales. With the boxed beef market struggling to put in a short-term low, beef movement must pick up before traders are convinced a period of firmer cash cattle prices lies ahead.
CASH HOGS SEEN STEADY/FIRMER... Packers are thought to be short-bought on slaughter supplies to start the week. With market-ready supplies tight, packers are expected to pay steady to firmer prices for cash hogs across the Midwest today, though tight cutting margins may limit gains in the cash market.
WEEKEND DEMAND NEWS... South Korea tendered to buy up to 60,000 MT of U.S., South American or South African corn.