First Thing Today (VIP) -- October 31, 2012

October 31, 2012 01:02 AM


PRICE STRENGTH OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 4 cents higher, soybeans 8 to 12 cents higher, Chicago wheat 5 to 9 cents higher, Kansas City wheat 3 to 6 cents higher and Minneapolis wheat 5 to 8 cents higher. The U.S. dollar index is under pressure this morning, which is helping support grain and soy futures.

U.S. STOCK, BOND MARKETS REOPEN... The U.S. stock market is scheduled to resume trade with its normal 8:30 a.m. CT open following two days of closure due to Superstorm Sandy. The U.S. bond market is also scheduled to reopen today. While financial markets are reopening, it's expected to take days before trade is back to "normal."

DATA IMPACTED BY SANDY... While impacting life and property, Sandy also had an impact on government and other economic data. USDA's weekly Crop Progress Report -- originally due Monday afternoon -- will be released this afternoon and the Weekly Export Sales Report will be delayed until Friday morning. As for economic data, some releases like Consumer Confidence were delayed (originally scheduled for Tuesday, but will now be Thursday) but Bureau of Labor Statistics workers are still aiming to put the key employment data out Friday morning as currently scheduled.

AG IMPACTS FROM SANDY UNCLEAR... With Crop Progress data delayed this week, it's currently a guess as to how much of the corn and soybean crop remained unharvested in states like Ohio, Indiana and Pennsylvania as Sandy arrived. That will become clearer today. The poultry industry is another focus for the impacts from Sandy given its presence in eastern Maryland and Delaware, two areas hit by Sandy. How the infrastructure fared in terms of delivery of feed, electricity, etc., in the region will be key in terms of how much impact there was to that sector. But it is not expected to have a national impact on either poultry supplies or prices.

EARLY AUSSIE WHEAT HARVEST RESULTS DISAPPOINTING... Protein levels on early harvested wheat in Queensland and New South Wales is coming in lower than anticipated and below the historical norm, according to reports out of the country. If that trend continues, it could drive up demand for U.S. spring wheat as many Asian buyers rely on shipments from eastern Australia for their high-protein wheat supplies. Meanwhile, yields are lower in Western Australia, but protein levels are better than in eastern states.

CASH CATTLE TRADE STARTS STEADY/LOWER... Cash cattle unexpectedly started trading at $126 (Kansas) to $127 (Texas) Tuesday, although most feedlots passed on the steady to lower bids in hopes of getting an even better price later this week. The willingness of packers to come with bids steady to just $1 lower than last week on Tuesday suggests demand for cash cattle may be stronger than many expected.

PORK CUTOUT SOFTENS, BUT MOVEMENT IMPROVES... The pork cutout value was 46 cents lower Tuesday, but packers moved a strong 134.25 loads of product on the day. The strong pickup in pork movement should ease some of the concerns with faltering demand, although it's still too early to tell what impact Sandy will have on East Coast meat demand.

OVERNIGHT DEMAND NEWS... Egypt tendered for optional origin wheat. Japan tendered for 120,000 MT of feed wheat and 200,000 MT of feed barley.


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