CORN AND WHEAT MOSTLY FIRMER, SOYBEANS WEAKER OVERNIGHT... As of 6:30 a.m. CT, corn futures are mostly around a penny higher and all wheat flavors are 1 to 2 cents higher. Soybean futures are 2 to 5 cents lower, with meal weaker and soyoil firmer amid spreading. Outside markets are mixed this morning, with the U.S. dollar index hovering around unchanged, crude oil firmer and gold weaker.
WEEKLY EXPORT SALES REPORT OUT THIS MORNING... For the week ended Nov. 7, traders expect: corn sales between 800,000 MT and 1 MMT; wheat sales between 350,000 MT and 550,000 MT; soybean sales between 900,000 MT and 1.2 MMT; soymeal sales between 200,000 MT and 350,000 MT; and soyoil sales between 25,000 MT and 50,000 MT.
EPA’S MCCARTHY: 2014 RFS PROPOSAL COMING ‘SOON’; SAYS DRAFT LEAKED PREVIOUSLY WAS VERY EARLY IN THE PROCESS... Renewable Fuels Standard (RFS) levels for 2014 are "soon to be proposed," EPA Administrator Gina McCarthy told lawmakers Thursday, but noted it will "take some time" before the plans are finalized. As for the draft plan leaked out in September, McCarthy told members of the House Science, Space and Technology Committee the draft proposal sent to the Office of Management and Budget for review was "very, very early in the process."
That plan indicated EPA was going to propose a corn-based ethanol level for 2014 at 13.0 billion gallons, below the 14.4 billion gallons spelled out in law and the 13.8 billion gallon level in place for 2013. McCarthy’s statement that it would "take some time" before the 2014 RFS levels are finalized is not a surprise as EPA stated when they released the final 2013 plans that they would not likely finalize the 2014 levels until June 2014.
VILSACK: OBAMA ADMINISTRATION NOT BACKING AWAY FROM SUPPORT FOR BIOFUELS... The Obama administration remains committed in its support for developing alternative fuels, even if the Environmental Protection Agency reduces the ethanol mandate in its 2014 renewable fuel standard (RFS), USDA Secretary Tom Vilsack said Thursday. Vilsack's comments, made during a forum on agriculture policy by Politico, followed a leaked draft of the EPA's 2014 RFS that indicated EPA is considering lower volume requirements in response to complaints from refiners that statutory mandates are not feasible, even though EPA Administrator Gina McCarthy told Congress on Thursday that draft was "very, very early in the process."
Vilsack said he had no knowledge of what the EPA intends to do in its renewable fuel standard, which is expected to be issued soon as a proposed rule. Vilsack cited the USDA's work to fund biorefineries, develop biofuels for the aviation industry and develop feedstocks that can be used as alternatives to traditional corn ethanol as examples of the administration's commitment to the industry. Vilsack said "Whatever the [RFS| numbers are, there is still an expectation that 14 billion gallons can be produced because there is a demand," adding that Minneapolis-based ethanol producer Cargill Inc. recently announced plans to open a new plant in Fort Dodge, Iowa.
HOUSE SPEAKER'S PRIORITIES FOR END OF YEAR: FARM BILL, WATER BILL, BUDGET PACT... House Speaker John Boehner (R-Ohio) said that while completing a new farm bill is on the House agenda for the remainder of the year, savings found by farm bill negotiators should not offset other budget spending. Boehner noted three items he said could be agreed upon by both parties before 2014 hits and the mid-term political season begins in earnest.
"There are issues that can be resolved before the end of the year, including reforms to our farm programs, a bill to reauthorize important water projects around the country, and hopefully, a budget agreement so that we can stop lurching from one crisis to another," Boehner said at his weekly press conference. Regarding farm bill budget savings, Boehner said, "I think it's a separate issue. And I've made that very clear to [House Budget] Chairman [Paul] Ryan (R-Wis.)," Boehner said of the farm bill savings.
Rep. Frank Lucas (R-Okla.), chairman of the House Agricultural Committee and of the farm bill conference, said, "I very much appreciate the speaker's observations that in effect the farm safety net should not be used as a cash cow for everybody else. But I will also acknowledge this: if we are able to get our work done in an orderly fashion before our appropriator friends are done, they're going to have to look at all savings." Lucas said it was too early to even count savings from the farm bill conference. "What have I said a thousand times? You can't have my money without my policy. We don't have policy yet, therefore we don't have any tithing to help the budget people with," he said.
CRUSH PICKS UP AS SUPPLIES COME ONLINE... Traders are expecting NOPA members to report soybean crush totaled 154.17 million bu. in October, which would be a sharp increase from 108.68 million bu. in September, thanks to harvest making supplies available. This would be the first time in five months U.S. crush rates posted a month-on-month increase. Pre-report expectations are for soyoil stocks to come in at 1.493 billion lbs. for October.
CHINA TO STOCKPILE DOMESTIC CORN/SOYBEANS... China's National Development and Reform Commission said the country will continue to buy corn and soybeans for state reserves from farmers in the major growing areas in the Northeast in an effort to boost domestic prices.
STILL WAITING ON CASH CATTLE TRADE... Traders will likely continue to even positions as they await the start of cash cattle trade. December futures are at nearly a $2 premium to last week's cash trade. This signals the cattle market may be vulnerable to pressure if cash action disappoints. Higher trade is by no means a "sure thing" since showlist estimates are up this week and boxed beef price action has been choppy.
PORK MOVEMENT REMAINS STRONG... Pork cutout movement has been strong this week to help offset an increase in market-ready supplies. Pork values even firmed 57 cents yesterday on 465.83 loads. But with packers having no difficulty securing needed supplies, look for the cash market to be steady to weaker again this morning.
OVERNIGHT DEMAND NEWS... Traders report Lebanon purchased 20,000 MT of wheat from Romania and Libya purchased 50,000 MT of milling wheat, with Germany the likely origin. Japan is seeking 43,000 MT of food wheat and 1,000 MT of food and malting barley.