First Thing Today (VIP) -- November 27, 2013

November 27, 2013 12:11 AM
 

GOOD MORNING!

GRAINS FIRMER OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 2 to 3 cents higher, soybeans are 3 to 8 cents higher and wheat futures are 2 to 6 cents higher with SRW contracts leading gains. The U.S. dollar index is modestly weaker this morning following two-sided trade overnight.

HOLIDAY TRADING SCHEDULE... Grain and livestock markets will observe normal trading hours today. All markets and government offices are closed Thursday for Thanksgiving. Grain and livestock markets will be open for an abbreviated session Friday, Nov. 29 -- from the normal start of open-outcry trade (there is no overnight electronic trade Thursday night/Friday morning) until noon CT for grains and 12:15 p.m. CT for livestock futures.

UKRAINE RAISES GRAIN EXPORT FORECAST... Ukraine now expects to export 32.5 MMT of grain in 2013-14, up from its previous estimate of 30 MMT and 23 MMT in 2012-13, according to the country's deputy ag minister. Through Nov. 26, Ukraine has exported 13.3 MMT of grain compared to 11.5 MMT last year on this date. Meanwhile, Kazakhstan's ag ministry says the country has exported 3.2 MMT of grain since the start of the 2013-14 marketing year on July 1 compared to 3.1 MMT last year on this date. The ministry expects the country to export up to 10 MMT of grain in 2013-14.

WTO CHIEF ACKNOWLEDGES DEFEAT IN EFFORTS TO SECURE BALI PACKAGE OF TRADE DEALS... World Trade Organization (WTO) members will not achieve their goal of securing a deal on a Bali package of trade agreements at their upcoming ministerial conference in Indonesia, WTO Director-General Roberto Azevedo said. Azevedo told a meeting of the organization's ruling General Council that he planned to brief trade ministers at the Dec. 3-6 meeting on the state of play in the negotiations but would not put forward the unfinished draft package for adoption. "We are not going to Bali with a set of finalized documents that could allow ministers to announce to the world a set of multilaterally agreed outcomes," Azevedo said. "And I will inform ministers that we have failed to find convergence. I will tell them that we came truly close to a successful outcome, but that, once more, the finish line eluded us." The WTO chief said that while the "overwhelming majority" of members at the General Council meeting said WTO members were too close to a deal to give up, he believed that extending the negotiations further in Geneva would not help. "If we had a few more weeks, we would still not make it," Azevedo said. "Over the last few days I began to see signs of backtracking and inflexibility. Time would not remedy the situation." He added, "The worst of all is that we would fail -- we would lose all of this -- for no justifiable reason. Nothing that is on the table requires any member to go beyond what is doable." Mexico's WTO ambassador Fernando de Mateo said there were still some available days before Bali to continue the negotiations, although he admitted WTO members were in a "very, very, very difficult situation, that's for sure."

CROP INSURANCE INDEMNITIES NEAR $6.1 BILLION... Indemnities for 2013 crops reached $6.093 billion as of Nov. 25, moving the loss ratio for the program to 0.52, according to Risk Management Agency data. Wheat payouts still lead all crops at $2.136 billion while corn indemnities have hit $1.695 billion and the level for cotton is now at $706 million. The indemnity mark for 2013, however, is still well below the record level from 2012 of $17.427 billion and a loss ratio of 1.57.

STEADY TO FIRMER CASH CATTLE PRICES EXPECTED... Packers have yet to establish initial cash cattle bids in the Plains, but expectations are building cash cattle prices will come in steady to firmer as packers won't want to be caught short-bought on slaughter needs coming out of this week's Thanksgiving holiday given tight market-ready supplies. Strength in the boxed beef market should also be supportive for steady to firmer cash cattle trade. But negative margins will likely keep packers from getting too aggressive with cash bids.

PORK MOVEMENT STAYS STRONG... Packers continue to move a lot of pork, with a strong 521.89 loads changing hands yesterday, while the cutout value stabilized and was down only a penny from Monday's closing price. While hog supplies and kill weights are rising, demand is so far chewing through the excess pork. That should be enough to keep cash hog bids steady at most Midwest locations as packers are trying to fill kill lines for Saturday given Thursday's downtime for Thanksgiving and strong cutting margins.

OVERNIGHT DEMAND NEWS... South Korea purchased a total of 118,000 MT of U.S. corn from two separate tenders. Egypt tendered to buy at least one cargo of optional origin wheat. Results of the tender will be known later this morning.

 

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