First Thing Today (VIP) -- October 15, 2012

October 15, 2012 01:12 AM


SOYBEANS SHARPLY LOWER OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 9 to 13 cents lower, soybeans mostly 17 to 30 cents lower, Chicago wheat 5 to 7 cents lower, Kansas City wheat 3 to 5 cents lower and Minneapolis wheat mostly around 3 cents lower. The U.S. dollar index is holding near unchanged this morning after being firmer earlier in the overnight session.

TUESDAY'S PRESIDENTIAL DEBATE KEY WASHINGTON FOCUS THIS WEEK... The second of three presidential debates is the major focus this week when President Barack Obama and GOP challenger Mitt Romney meet Tuesday at Hofstra University in Hempstead, New York. The debate will have a different format, with an audience of undecided/independent voters picked by Gallup Poll asking questions. Traders will keep watching earnings reports and any central bank moves as the week unfolds. Mideast tensions remain a focus for crude oil traders as well. Also, there are several European Union/euro-zone events on tap this week. Congress remains on their pre-election break with a lame-duck session on tap following the Nov. 6 elections.

CHINESE SEPTEMBER SOY IMPORTS RISE SHARPLY... China imported 4.97 MMT of soybeans in September, according to official customs data. That was a 12.4% increase from August and 20.3% greater than year-ago. Through the first nine months of this year, Chinese soybean imports stand at 44.3 MMT, up 17.7% from year-ago. State-run China National Grain and Oils Information Center now forecasts 2012 soybean imports at a record 57 MMT. Meanwhile, China's trade surplus widened to $27.7 billion from $26.7 billion in August as exports rose 9.9% from year-ago, while imports rose 2.4%.

CHINESE INFLATION CONTINUES TO EASE... China's consumer price index (CPI) eased to 1.9% above year-ago in September, down from a 2% rise in August. Food prices were 2.5% higher than year-ago last month, while non-food prices rose 1.7%. Meanwhile, the producer price index (PPI) declined 3.6% last month compared with year-ago. Falling inflation gives the People's Bank of China plenty of room to ease monetary policy, although the improved trade data may buy the central bank some time before it acts again.

SEPTEMBER CRUSH LIKELY SLOWED FROM AUGUST... NOPA members are expected to report September soybean crush slowed to 119.6 million bu., based on the average pre-report guess. But the guess range is very wide at 110.9 million bu. to 126.3 million bushels. Soybean crush totaled 124.773 million bu. in August and 110.313 million bu. in September 2011. Soyoil stocks are guessed at 2.012 billion pounds.

WILL CASH CATTLE STRENGTH CONTINUE?... Cash cattle traded $1 higher around $125 in the Plains last week despite negative packer cutting margins. Key to sustaining strength in the cash cattle market is likely tied to beef demand. Instead of focusing on boxed beef prices, traders should pay more attention to product movement as they form this week's cash opinions.

CASH HOGS CALLED MOSTLY STEADY... Packers are expected to open the week offering steady bids for cash hogs at most Midwest locations. While market-ready supplies are plentiful, packers continue to work with strong margins, giveng them incentive to make sure kill lines are as full as possible.

WEEKEND DEMAND NEWS... Iraq tendered for 50,000 MT of optional origin wheat. Algeria also tendered for 50,000 MT of optional origin milling wheat.


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