Price pressure overnight... As of 6:30 a.m. CT, corn futures are trading 5 to 9 cents lower, soybeans are 6 to 8 cents lower in old-crop contracts and 1 to 2 cents lower in new-crop contracts, while wheat futures are mostly 6 to 9 cents lower. The U.S. dollar index is modestly higher this morning after two-sided trade overnight.
March S&D Report out this morning... Traders are expecting USDA to raise its 2013-14 soybean export projection, which would lower old-crop carryover. Corn and wheat ending stocks are expected to come in slightly higher than last month. The average pre-report trade guesses peg corn carryover at 1.487 billion bu., soybean ending stocks at 141 million bu. and wheat carryover at 568 million bushels. On the global front, USDA is expected to lower its Brazilian soybean crop estimate.
Budget issues the focus of Congress this week... Congress returns from another short week to focus on hearings on budget plans for FY 2015 for a host of government agencies, as both chambers prepare to make spending decisions for year the fiscal year that begins Oct. 1. At the end of this legislative week, both chambers of Congress are scheduled to take a one-week Spring recess. The House plans to take up a farm spill prevention (HR 311). On Friday, USDA Secretary Tom Vilsack and other Ag Department officials, including chief economist Joe Glauber, testify at a USDA appropriations hearing. The House also will consider a bill (HR 3189) that would prohibit the Interior and Agriculture departments from requiring certain applicants to surrender their water rights in order to obtain land permits.
Likely impact of Ukraine-Russia situation... Experts see the situation settling down in around 30 days. Most see Crimea in Russia's sphere -- either annexed or as an "independent" republic. No major U.S. or European sanctions are expected, but there will be lots of bluster. Long-term, a separate Crimea would mean less ethnic Russians voting in Ukraine elections, and a more Western-oriented Ukraine. Experts say Russia will find Crimea a money drain. And, a more Western-based Ukraine will eventually likely show more economic progress, ala the days of Eastern and Western Europe and North and South Korea. This is why some analysts say Russia's Putin may win the early rounds of this situation, but lose longer-term.
Chinese February soybean imports down from January, but sharply higher than year-ago... China imported 4.81 MMT of soybeans in February, according to official customs data. While that was down 18.6% from January, soybean imports were 65.9% greater than February 2013. For the first two months of this year, Chinese soybean imports of 10.72 MMT are up 40.1% from year-ago.
Concerning Chinese trade data, but tame inflation... China unexpectedly posted a trade deficit of $23 billion in February, which was well below expectations for a trade surplus of $14.5 billion. Exports plunged 18.1% last month, while imports rose 10.1%. The very disappointing trade data is raising concerns about the health of China's economy. Meanwhile, China's consumer price index (CPI) came in at a 13-month low at 2% above year-ago for February. Food prices rose 2.7% from year-ago, while non-food prices increased 1.6%.
Syngenta to require farmers to sign 'stewardship agreement' for Duracade corn... Syngenta will require farmers who plant Duracade corn this year to sign a "Syngenta Stewardship Agreement," according to the National Grain and Feed Association. The document reportedly says farmers agree to feed the corn to livestock or poultry domestically or sell it to a grain facility that does not export to China or the European Union, who have not yet approved the GMO corn trait.
Bearish cash cattle expectations... After cash cattle traded mostly $2 lower in the Plains last week, traders are expecting more price pressure this week. Given negative cutting margins, packers will attempt to get animals bought at lower prices, though tight market-ready supplies should limit price pressure.
Cash hogs called steady/firmer... Packer demand for cash hogs is expected to be strong enough to start the week to produce steady to firmer cash hog bids across the Midwest. While much improved weather may free up a few extra hogs, market-ready supplies are tight enough to keep competition for available supplies relatively strong.
Weekend demand news... Israel tendered to buy up to 90,000 MT of optional origin corn and 25,000 MT of optional origin feed wheat.