First Thing Today (VIP) -- March 20, 2013

March 20, 2013 01:36 AM


FIRMER TONE IN GRAINS... As of 6:30 a.m. CT, corn futures are trading around 2 cents higher, soybeans are around 9 cents higher in old-crop contracts and 2 to 4 cents higher in new-crop contracts, Chicago wheat is 4 to 8 cents higher, while Kansas City and Minneapolis wheat are 5 to 6 cents higher. The U.S. dollar is weaker this morning.

FOMC MEETING WRAPS UP TODAY... The two-day Federal Open Market Committee (FOMC) meeting wraps up this afternoon, with traders focused on whether there are any indications in the post-meeting statement of how soon the Fed may scale back or stop its stimulus efforts. The Fed will also release its longer-term economic forecasts at the same time as FOMC statement. Fed Chairman Ben Bernanke will hold his quarterly press conference later this afternoon.

MEAT INSPECTOR FUNDING IN SENATE SPENDING BILL NOW IN DOUBT... The way we read the latest developments in the Senate's stop-gap spending measure is that another cloture vote will be held this morning. If Senate Democratic leadership succeeds with a cloture vote, then a vote will occur on a leadership substitute bill that has three amendments, but not language that would provide funding to avoid furloughs of meat inspectors beginning in mid-July. We'll have any major update in "Evening Report."

UKRAINE TO RAISE WHEAT EXPORT CAP... Ukraine will increase the amount of wheat it allows exporters to sell abroad in 2012-13 to 7 MMT from 6.5 MMT previously, according to Agriculture Minister Mykola Prysyazhnyuk. Earlier this week, Prysyazhnyuk said the Ukrainian government will extend its grain export cap into 2013-14 with a memorandum of understanding likely to be signed in the coming months, without giving a specific tonnage.

ICAC OFFICIAL: CHINA SEEN SELLING 3 MMT OF COTTON FROM STATE RESERVES... China is expected to sell 3 MMT of its robust 10 MMT of state-owned cotton reserves prior to this year's harvest, the executive director of the International Cotton Advisory Council (ICAC) tells Reuters. He says cotton prices will likely fall as China completes its stockpiling and sells some of those reserves domestically, suggesting international prices need to be "around 70 cents or 80 cents a pound to be competitive with polyester."

JPMORGAN CHASE ANNOUNCES AGREEMENT WITH MF GLOBAL... JPMorgan Chase announced a $546 million settlement late Tuesday night with MF Global. Of that amount, $100 million would go toward customer claims as part of the effort to recover funds lost during the Oct. 31, 2011, failure, effectively resolving the matter between the two financial firms, The Wall Street Journal reports. JPMorgan also is relinquishing claims it had on $417 million in MF Global funds that had been returned to trustee James W. Giddens, who represented customers. The return of customers' funds could have been delayed for two to three years, Giddens said in a release. Under the agreement, which requires court approval, there will likely be another $300 million headed for customers, according to reports. PERSPECTIVE: The deal would provide U.S. customers with about 95 cents on the dollar.

CASH CATTLE TRADE LOWER... Cash cattle trade unexpectedly got started at $2 lower prices than week-ago in the Central and Southern Plains on Tuesday. Cash sources say light cash trade was seen at $125 in Texas and $124 to $125 in Nebraska. Most feedlots are still holding out in hopes of getting steady cash bids compared with last week.

PORK CUTOUT FALLS... After two days of price gains, the pork cutout value dropped $1.14 Tuesday. If there's a silver lining, it's that movement picked up on the price drop as packers moved a solid 80 loads of product for the day. Still, traders remain concerned with pork demand as movement slows on even a modest uptick in pork prices.

OVERNIGHT DEMAND NEWS... Taiwan purchased 23,000 MT of U.S. corn and 12,000 MT of U.S. soybeans and 60,000 MT of Argentine corn. India is in talks to export wheat to Egypt.


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