WEAKER TONE OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are 4 to 6 cents lower in old-crop contracts and mixed in new-crop contracts, Chicago wheat is mostly 4 to 6 cents lower, Kansas City wheat is around a nickel lower and Minneapolis wheat is around 2 cents lower. The U.S. dollar index is firmer this morning after disappointing euro-zone GDP data.
HOUSE AG PANEL TO MARK UP FARM BILL TODAY... And just like the Senate Ag panel on Tuesday, the House version is expected to be approved today. Sources say a Republican effort to modify the dairy supply management language in the proposed House farm bill will not have the votes for passage. Meanwhile, the Senate farm bill was filed last night, which clears the way for a vote as soon as tomorrow, but more likely next week. There were no major changes in the proposed Senate farm bill in its Tuesday markup.
CBO'S MAY UPDATE PARES FARM BILL BASELINE... A budget deficit of $642 billion would be the result for FY 2013 if there are no changes to tax and spending laws, according to the May baseline update from the Congressional Budget Office (CBO), down from its prior outlook for an $845 billion budget shortfall. For agriculture, the update trims the budget baseline relative to the new farm bill, but not enough to cause a necessity for any major policy shifts. The scoring of the House and Senate farm bills released by CBO this week were based on the updated May baseline.
SLOWER CRUSH PACE EXPECTED... The National Oilseed Processors Association is expected to report soybean crush totaled 125.2 million bu. in April, based on the average pre-report guess. That would be down from 137.08 million bu. in March as old-crop soybean supplies are tight and some plants took seasonal downtime last month. Soyoil stocks are guessed at 2.627 billion pounds.
CHINA TO IMPORT RECORD AMOUNT OF SOYBEANS IN 2013-14... China is forecast to import a record 66 MMT of soybeans in 2013-14 amid strong domestic demand and tight supplies, according to state-run China National Grain and Oils Information Center. That would be up 11.9% from the current marketing year, in which Chinese soybean imports are expected to decline by 230,000 MT from 2011-12. Last week, USDA forecast 2013-14 Chinese soybean imports at 69 MMT in its first look at the new-crop balance sheet.
ECONOMISTS CUTTING FORECASTS FOR CHINA'S GROWTH... Many economists are cutting their forecasts for China's growth after a fourth month of disappointing data. A Wall Street Journal survey of 18 economists late last year showed the median forecast for growth in 2013 at 8%, up from the 7.8% rise China posted last year. But a survey of 12 economists this week showed the median forecast has since fallen to 7.8%. PERSPECTIVE: Recent Chinese economic data signals the world's second largest economy continues to struggle, prompting the GDP outlook downturn. Meanwhile, Chinese Premier Li Keqiang was quoted by the China Securities Journal as saying there was little room for government spending and stimulus efforts to bolster the economy and he called on market forces to be allowed to work.
RECORD HIGH IN CHOICE BOXED BEEF... While traders remain fearful the product market is close to a top, Choice boxed beef prices are giving no indication of that yet. In fact, Choice boxed beef prices were 96 cents higher Tuesday, surging to an new high of $206.09. Memorial Day buying is likely complete, but after a wet and cold start to spring, there seems to be pent-up demand now that temps are finally warming.
PACKER DEMAND FOR CASH HOGS HOLDS STRONG... There were concerns demand for cash hogs would wane this week given negative packer margins. But with farmers actively planting corn, the supply of hogs has been reduced enough to keep demand for cash hogs strong and the cash hog market supported. Cash hog bids are expected to be steady at most locations again today.
HALF OF SMITHFIELD PORK PRODUCTION TO SOON BE RACTOPAMINE-FREE... Smithfield currently has two plants which are producing hogs that are free of the feed additive and a third plant will be ractopamine-free by June 1, the company's CEO told Reuters in an interview. When the third plant is fully converted, more than half of the company's total pork production will be ractopamine-free.
OVERNIGHT DEMAND NEWS... Japan bought at least 150,000 MT of South African corn and Taiwan bought one cargo of South African corn. South Korea purchased 70,000 MT of Australian wheat. Jordan passed on a tender to purchase 150,000 MT of optional origin milling wheat.