GRAINS MILDLY WEAKER... As of 6:30 a.m. CT, corn futures are around 1 cent lower, soybeans are mostly 1 to 3 cents lower, Chicago wheat is mostly 3 to 4 cents lower, Kansas City wheat is mostly 1 to 4 cents lower and Minneapolis wheat is around 2 cents lower. The U.S. dollar index is modestly firmer this morning.
MGEX TO ALSO CUT TRADING HOURS... As we reported in "Evening Report" yesterday, CME Group plans to cut grain trading hours starting April 8. The Minneapolis Grain Exchange (MGEX) will also reduce trading hours for its HRS wheat futures and options as of April 8, pending approval by the Commodity Futures Trading Commission. MGEX trading hours will be: Sunday to Friday, electronic trading from 7:00 p.m. to 7:45 a.m. CT, a break in electronic trading from 7:45 a.m. to 8:30 a.m. CT and then floor and electronic trading from 8:30 a.m. to 1:30 p.m. CT. The daily settlement time will remain unchanged at 1:15 p.m. CT.
USDA CONFIRMS NO CHANGE IN REPORT TIMES… USDA will not be changing its release time for its grain reports in the wake of the CME Group and MGEX announcing they intend to trim back trading hours for grain and oilseeds as of April 8. "At this point we have no plans to change our release," World Agricultural Outlook Board Chairman Jerry Bange told USDA Radio. "I think that the record will show the noon (ET) release has worked very well. The truth of the matter is I’ve gotten no complaints about it and it seems to be working very well now." Our sources signaled when the prospect of adjusted trading hours first surfaced earlier this year that there was no intention of changing report release times again. Bange also noted that Friday’s USDA update will be released regardless of wintry weather that has begun in Washington and is expected to dump 6 to 10 inches of snow.
CHINESE GRAIN IMPORTS 'REASONABLE'... China's grain imports are reasonable and within import quotas, according to the head of the State Grain Administration at the country's annual planning session. He says China will try to attain 98% self sufficiency for cereal grains "in the future," but will support companies if they want to import grains. However, he indicated most state grain reserves will be procured from domestic supplies.
INDIA TO DISCUSS ADDITIONAL WHEAT EXPORTS THURSDAY... An Indian ministerial panel will discuss a proposal to allow additional wheat exports tomorrow, according to India's farm minister. While he gave no specific tonnages, Reuters reported Tuesday the proposal is for an additional 5 MMT of wheat exports, citing an unnamed government source. Another Indian official told Reuters exports of government wheat stocks are a "priority" ahead of the new-crop harvest.
VILSACK: SEVERAL MONTHS BEFORE ANY MEAT INSPECTORS FURLOUGHED DUE TO SEQUESTER... As expected, USDA Secretary. Tom Vilsack Tuesday was quizzed at length about the impact of sequestration (across-the-board) budget cuts on agriculture, and especially meat inspectors. He told House Ag Committee members it will take several months before any meat inspectors are furloughed because of the sequester. Inspectors likely will have to be furloughed for 11 or 12 days, but he stressed the furlough days would not be consecutive. Vilsack's previous comments made the unpaid leaves seem imminent and their economic effect on the meat industry and ranchers and farmers potentially crippling. Vilsack said he has little flexibility with the FSIS budget because 87% of the agency’s cost is its personnel. But Sen. Pat Roberts (R-Kan.) said there would be efforts to stop or modify the cuts mandated by the sequester. He said there would be an effort in the Senate’s version of the continuing resolution (CR) to give agencies such as USDA more flexibility in making sequester cuts. In particular, Roberts said he wanted to stop the furloughs of meat inspectors.
BEEF DEMAND REMAINS A CONCERN... Boxed beef prices were sharply higher again Tuesday, but packers moved only 159 loads of product on the day. Until boxed beef movement improves, traders will be reluctant to actively pump money into the long side of the market given ongoing concerns with beef demand.
LOWER PORK CUTOUT ATTRACTS DEMAND... The pork cutout value dropped $1.79 Tuesday amid sharp losses in all but ribs (2 cents higher) and bellies (5 cents lower). The sharp drop in prices attracted strong demand, however, as packers moved 140.08 loads of product on the day. Still, there are concerns with pork demand, which limits the upside in lean hog futures despite heavily oversold conditions.
OVERNIGHT DEMAND NEWS... South Korea purchased 69,000 MT of South American corn. Japan bought 80,130 MT of feed wheat and 100,500 MT of feed barley and tendered to buy another 120,000 MT of feed wheat and 200,000 MT of feed barley.