MIXED TO MOSTLY LOWER OVERNIGHT... As of 6:30 a.m. CT, corn futures are 2 to 4 cents lower, soybeans are 1 to 2 cents higher in old-crop contracts and 4 to 7 cents lower in new-crop contracts, Chicago wheat is 2 to 3 cents lower, Kansas City wheat is mostly 1 to 2 cents lower and Minneapolis wheat is narrowly mixed. The U.S. dollar index is currently near unchanged after trading lower overnight.
MAJOR DEFEAT FOR AG COMMUNITY IN HOUSE FARM BILL PUTDOWN... The stunning defeat Thursday of the House farm bill, 195-234, has led to major uncertainty as to its outlook. While some see another extension of the 2008 Farm Bill, our sources signal that is the last resort and will likely be avoided. But House GOP leaders garnered a stinging loss and must now regroup. One lobbyist told us, "My gut tells me the Republicans need to regroup quickly and understand the political beating they are going to take from their rural base and that the stupid overreach on SNAP will cost them all the other reforms in the bill they liked. Until they fix this, senate democrats will make them the poster child of disfunctionality."
SENATORS FILE BIPARTISAN BILL TO END BIOFUEL MANDATE... A bipartisan group of senators floated a bill to end the biofuel mandate policy. Sens. John Barrasso (R-Wyo.), Pat Toomey (R-Pa.) and Mark Pryor (D-Ark.) are leading the effort, which calls for ending the Renewable Fuel Standard (RFS). "The Renewable Fuel Standard is fundamentally broken and beyond repair," Barrasso said in a statement. Its opponents argue the mandate’s targets are accelerating too fast given current supplies, while its supporters say the rule already provides plenty of flexibility. The biofuel industry quickly criticized the bill. It said the legislation was a concession to the oil industry, which competes with biofuel in the transportation fuel market. "It’s unacceptable that Senator Barrasso would introduce legislation that protects the oil industry’s monopoly over our nation’s fuel supply," Fuels America, a coalition of biofuel groups, said in a statement. Full repeal of the rule is very unlikely. Several measures in both the House and the Senate, however, call for more specific changes, but source signal any such legislation would likely impact 2014 volume requirements, not this year.
LOW-PATH BIRD FLU FOUND IN ARKANSAS... A low-pathogenic strain of H7N7 bird flu was discovered on a poultry farm in Scott County, Arkansas, according to Arkansas Livestock and Poultry Commission Director Preston Scroggin. He says 8 in 9,000 birds on the farm tested positive for the bird flu strain. The entire flock has been euthanized and all eggs were destroyed. Officials also quarantined all farms within a 6.2 mile radius and no additional case were found.
RUSSIA RAISES GRAIN CROP FORECAST... Russia upped its grain production forecast to 95 MMT from 93 MMT previously, according to Ag Minister Nikolai Fyodorov, without giving details. Wheat production is forecast to account for 54 MMT of that total.
INDIA APPROVES DOMESTIC WHEAT SALES, PUNTS ON EXPORTS... India's ministerial cabinet approved the sale of 10 MMT of wheat from government stocks in the domestic market. But a decision on whether to allow an additional 2 MMT of wheat exports from government reserves has been pushed back. The ministerial cabinet may discuss the additional wheat exports next week.
GMO WHEAT UPDATE... USDA investigators are still looking for answers in the GMO wheat case. A USDA official told Reuters they have conducted tests on eight samples of seed and four grain samples and all results have been negative. Investigators are now checking a government seed storage facility in Colorado, which is a preservation center for genetic resources, to see if any of the experimental seed was sent there.
BELOW YEAR-AGO NUMBERS EXPECTED IN CATTLE ON FEED REPORT... USDA's monthly report on feedlot activity this afternoon is expected to show On Feed at 96.5%, Placements at 95.9% and Marketings at 97.9% of year-ago. While Placements are widely expected to be under year-ago, the guess range is wide, from 84.3% to 99.8%, meaning that category will provide the report "read."
RECORD END-OF-MAY PORK STOCKS EXPECTED... USDA's Cold Storage Report this afternoon is expected to show total pork stocks at 663 million lbs. as of the end of May, based on the average pre-report guess. While that would be down around 5% from month-ago, it would represent record-large pork stocks for the end of May. Beef stocks are guessed at 511.5 million pounds.
STILL WAITING ON CASH CATTLE TRADE... With bids and asking prices still far apart, it appears active cash cattle trade won't be seen until late today. Both feedlots and packers seem willing to wait until after the Cattle on Feed Report to get serious on negotiations.
CASH HOGS CALLED MOSTLY STEADY... Market-ready hog supplies remain tight and cutting margins are profitable, which is keeping the cash hog market supported. Cash hog bids are expected to be steady at most Midwest locations to close out the week.
OVERNIGHT DEMAND NEWS... Exporters reported no tenders or purchases.