First Thing Today (VIP) -- June 25, 2013

June 25, 2013 01:07 AM


GRAINS FIRMER OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 4 to 5 cents higher, soybeans are 6 to 10 cents higher in all but the July contract which is around 3 cents higher, Chicago wheat is 5 to 6 cents higher, Kansas City wheat is 2 to 3 cents higher and Minneapolis wheat is 1 to 2 cents higher. The U.S. dollar index is weaker this morning.

HOUSE REPUBLICAN FLOATS PLAN THAT COULD LEAD TO EVENTUAL PASSAGE OF HOUSE FARM BILL... Rep. Steve Southerland (R-Fla.) said he is willing to remove contentious language to create pilot programs that would make food aid contingent on work and job training and add it to another piece of legislation. That would help allow GOP House leaders to bring back the bill. Southerland’s amendment, which House sources say really was spurred by Majority Leader Eric Cantor (R-Va.), won approval on largely partisan lines, 227-198. Today's House leadership meeting and the Republican conference’s weekly meeting on Wednesday could provide the next signals for whether the GOP will take Southerland up on his offer.

HOUSE WAS CLOSER TO PASSING THE FARM BILL LAST WEEK THAN THE FINAL VOTE SIGNALED... It appears that a final whip count showed around 15 or more Republicans would vote for the bill than those who actually did so. But those votes switched to no when it was clear the measure would go down to defeat. Also, GOP leaders and others figured they would get 32 Democratic votes, but only received 24. The major error, contacts advise, was that GOP leaders should have postponed the farm bill vote until this week. They should have held another whip meeting after the votes on amendments, sources advise. Had they done so, they would have had more time to check on how many Democratic votes could be garnered after the contentious Southerland/Cantor amendment passed.

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 crop improved 6 points to 370, while the soybean crop firmed 3 points to 364. Illinois and Iowa led the way for both crops, though the improvement was more pronounced for the corn crop than it was for soybeans.

CHINESE JUNE SOY IMPORTS SEEN RECORD-LARGE... China is expected to import a record 8.32 MMT of soybeans in June, according to state-run China National Grain and Oils Information Center, citing Ministry of Commerce data. After months of port delays in Brazil that slowed Chinese soybean imports, Chinese importers are actively looking to rebuild stocks this month.

STATS CANADA TO UPDATE CANADIAN ACREAGE THIS MORNING... Statistics Canada is expected to show all wheat plantings at 26.2 million acres, which would be up 2.4 million acres from year-ago, but down roughly 400,000 acres from its earlier estimate. Canola plantings are expect to come in at 19.7 million acres, down roughly 1.8 million acres from year-ago, but up around 600,000 acres from Stats Canada's previous estimate. Barley acres are seen at 7.3 million, down around 100,000 acres from year-ago, but up marginally from the previous estimate.

UNCERTAIN CASH CATTLE OUTLOOK... Feedlots are hoping packers will be more active in their pursuit of cash cattle this week after three consecutive weeks of light purchases and given strong cutting margins. But packers are buying for a shortened slaughter schedule next week around the Fourth of July holiday, which may again limit their demand for cattle and showlist numbers are thought to be up from week-ago in Kansas and Texas. The pieces are in place for another week of extended cash cattle negotiations.

PORK CUTOUT FIRMS, BUT MOVEMENT SLOWS... The pork cutout value was $1.09 higher Monday, but packers moved only 199.8 loads of product on the day. If movement doesn't pick up, it could signal retailers are starting to resist higher prices. But until prices turn noticeably lower, traders won't be concerned about a top in the product market.

OVERNIGHT DEMAND NEWS... Japan tenders to purchase 58,000 MT of food-grade wheat and 33,000 MT of food-grade barley.


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