First Thing Today (VIP) -- March 14, 2014

March 14, 2014 01:33 AM

Good morning!

Varied price action overnight... As of 6:30 a.m. CT, corn futures are narrowly mixed, soybeans are 2 to 5 cents lower and wheat futures are steady to a nickel higher. March grain and soy futures expire at noon CT today. The U.S. dollar index is weaker this morning.

Ukraine-Russia update... John Kerry is scheduled to meet Russian Foreign Minister Sergey Lavrov today in another attempt to resolve the Ukraine crisis. The talks come ahead of a referendum in Crimea on Sunday over a proposal for the province to join Russia, which yesterday started a fresh set of military exercises near Ukraine. Meanwhile, Ukraine appealed for arms, ammunition and intelligence support, according to senior U.S. officials, but the Obama administration has agreed to send only military rations for now, wary of inflaming Russia. Meanwhile, Senate action on Ukraine aid bill is set after next week's recess. Senate Majority Leader Harry Reid (D-Nev.) filed cloture on the motion to proceed to the bill (S 2124) that would provide loan guarantees and $150 million in economic assistance to Ukraine. It also would impose sanctions and guarantee the International Monetary Fund (IMF) has the resources to assist Ukraine. Reid said action on the measure would be the first order of business when the Senate returns March 24 from its week-long recess. The sanctions would include visa bans and asset freezes on individuals involved in economic extortion and corruption associated with Russia’s occupation of Ukraine.

Delays at Argentina's main grain hub... A grounded ship carrying soybeans is blocking the main waterway at Argentina's top grain port at Rosario, limiting ship movement into and out of the port. The blockage is likely to last until at least Monday. Meanwhile, unionized dockworkers at Rosario are holding a one-day work stoppage today as they seek better wages. The union head says dockworker strikes will start March 25 if wage talks haven't started by then.

China's state corn stockpile builds... China's state corn stockpile for 2013-14 had already reached 54.66 MMT by March 10 and is expected to be around a record 60 MMT by the end of April when this year's stockpiling program ends, according to China National Grain and Oils Information Center (CNGOIC). The state-run think-tank says reduced demand due to bird flu has caused Chinese farmers to sell more corn to the government. In 2012-13, the Chinese government bought around 30 MMT of corn from farmers. CNGOIC lowered its 2013-14 Chinese corn consumption forecast to 119.5 MMT, down 4.5 MMT from last month amid slackened demand from the feed sector. But CNGOIC left its 2013-14 Chinese corn import forecast at 5.5 MMT as imports are cheaper than domestic supplies.

Boehner: Highway funding, food stamp 'cheating' among House priorities... House Speaker John Boehner (R-Ohio) cited bills dealing with highway funding, terrorism risk insurance and the Export-Import Bank, as well as the need to tighten eligibility for food assistance programs, as among the House's priorities in the months ahead. Regarding food stamps, Boehner said, "Since the passage of the farm bill, states have found ways to cheat once again on signing up people for food stamps. And so I would hope that the House would act to try to stop this cheating and this fraud from continuing." The legislative list was not exhaustive, Boehner said. "We've got issues like immigration which I think are important, ought to be dealt with. I think replacing ‘Obamacare’ certainly is something that we intend to do. Doing a budget -- it's our intent to do a budget. So we've got a lot of work on our list," he said.

Argentina to ask for WTO ruling over EU duties on biodiesel... Argentina will seek the establishment of a World Trade Organization (WTO) dispute panel to rule whether the European Union violated global trade rules by imposing antidumping duties on imports of biodiesel from Argentina. Argentina said the duties had effectively shut off a market worth $1.5 billion annually in exports. EU member states agreed by a majority vote Oct. 22 to proceed with the imposition of definitive duties on imports of biodiesel from Argentina and Indonesia, following the imposition of provisional duties the previous May. The final duties took effect on Nov. 27 and range from 217 euros to 246 euros ($301 to $341) per metric ton on imports from Argentina, reflecting an average additional duty of 24.6%.

Still waiting on cash cattle trade... Plains feedlots passed on lower cash cattle bids Thursday in hopes packers will pay at least steady prices -- $148 in Texas/Kansas and $150 in Nebraska -- for this week's supplies. While packer margins have turned positive this week, they may be reluctant to pay more than steady prices for cash cattle as wholesale beef prices are likely nearing a short-term top.

Pork cutout tops $120... The pork cutout value was another $1.12 higher yesterday as all cuts except hams and bellies posted strong gains. That pushed the cutout value to a record $120.62. While movement slowed to 268.69 loads, the wholesale pork market is showing no signs of stalling. Retailer pork demand is typically slower to respond to major price surges than is beef demand.

Overnight demand news... Exporters reported no tenders or purchases.


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