CHOPPY PRICE ACTION OVERNIGHT... As of 6:30 a.m. CT, corn and soybean futures are narrowly mixed amid bull spreading, Chicago and Kansas City wheat are mostly around a penny lower and Minneapolis wheat is around 1 cent higher. The U.S. dollar index is under pressure this morning.
FARM BILL DEBATE IN SENATE, BERNANKE TESTIMONY KEY FOCUS IN WASHINGTON THIS WEEK... The Senate today will begin its farm bill debate, while the House considers another bill (HR 3) approving the Keystone Pipeline without the approval of President Obama. On the economic front, Fed Chairman Ben Bernanke on Wednesday appears before the Joint Economic Committee on the outlook for the U.S. economy. At the conclusion of the week's business, both chambers will adjourn for a week-long Memorial Day recess -- May 27-31. (House is out May 24.)
CHINA TO STOCKPILE MORE SUGAR... China will begin stockpiling 300,000 MT of domestic sugar on Friday in an effort to boost prices and support farmers, according to the National Development and Reform Commission. The sugar will be purchased at 6,100 yuan ($990) per ton. This is the second round of stockpiling of 2012-13 sugar by the Chinese government as 1.5 MMT of domestic sugar was purchased from October through January.
FIRM RAISES RUSSIAN WHEAT CROP FORECAST... Russia's Institute for Agricultural Market Studies (IKAR) raised its Russian wheat crop forecast to 53.8 MMT from 52.5 MMT previously despite drought in some areas of the country. IKAR now forecasts the Russian grain crop at 92 MMT.
CANADA WILL WAIT ON DETAILS OF USDA FINAL COOL RULE BEFORE DECIDING ON ANY RETALIATION LIST... Jeffrey English, a spokesman for Canada's Agriculture Minister Gerry Ritz, says Canada will not submit any retaliation list to the WTO until it sees what changes the U.S. government proposes relative to country-of-origin labeling (COOL). May 23 is the deadline for U.S. compliance with a World Trade Organization (WTO) ruling that found a U.S. labeling law/provisions constitute an unfair trade barrier. Canada, English said, still hopes the U.S. will comply with the WTO by May 23, but is planning its next steps in case it does not. The clarifying Canadian statement came after Ritz during a news conference in Saskatoon, said Canada "will be putting forward a list of retaliatory products to make sure that the Americans have a further understanding of what that will be. The process requires that it goes back to the WTO for a ruling on whether or not their (U.S.) changes are acceptable. Should they not be, then those retaliatory measures are assessed and put into play, and that process can take some months if not a year." Ritz did not say what products Canada will seek to target, but last month he said he expects to go beyond targeting only U.S. beef and pork. Sources signal the U.S. will meet the May 23 WTO deadline.
PEDV CONFIRMED IN IOWA HOG HERD… The presence of the porcine epidemic diarrhea virus (PEDV) in the Iowa hog herd was confirmed Friday by USDA's National Veterinary Services Laboratories. The virus does not present any human health impacts and is not a food safety concern, according to USDA's Animal and Plant Health Inspection Service (APHIS), nor are there any interstate movement restrictions relative to PEDV. APHIS held a call with livestock industry reps Friday on the matter and it is not clear how widespread the virus may be. Lean hog futures declined Friday in part on talk of the situation but it was not confirmed until after markets closed for the week.
BEARISH CATTLE ON FEED REPORT... Last Friday's Cattle on Feed Report showed all categories on the negative side of the pre-report guesses, with the Placements category being the most bearish. As a result, cattle futures are expected to open under pressure this morning, with fall- and winter-month futures expected to lead losses. But given recent price pressure, some of the negative report data is already "in" the market.
CASH HOGS CALLED STEADY/FIRMER... Packers are expected to open the week offering steady to firmer cash hog bids across the Midwest. While cutting margins are tight, market-ready hog supplies are declining, which should keep demand for cash hogs solid.
WEEKEND DEMAND NEWS... Vietnam purchased 120,000 MT of U.S. new-crop soybean meal.