First Thing Today (VIP) -- September 13, 2013

September 13, 2013 01:21 AM
 

GOOD MORNING!

WEAKER PRICE ACTION OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are fractionally to 2 cents lower, SRW wheat futures are 5 to 6 cents lower, HRW wheat futures are 4 to 5 cents lower and HRS futures are steady to 2 cents lower. The U.S. dollar index is firmer this morning.

EPA EXPECTED TO RELEASE INITIAL RFS VOLUME REQUIREMENTS FOR 2014 THIS MONTH... Our best sources signal the corn-based ethanol volume requirement could be announced at no lower than 13.8 billion gallons (same as 2013), but no higher than 14 billion gallons. If so, those figures would be below the 14.4-billion-gallon figure contained in 2007 energy legislation detailing the mandate levels. EPA has said it would finalize the requirements for ethanol and other biofuels by June 2014.

PLAINTIFFS APPEAL COURT RULING DENYING PRELIMINARY INJUNCTION IN COOL LAWSUIT... Plaintiffs in the country of origin labeling (COOL) lawsuit filed a notice of appeal yesterday of the September 11 ruling by US District Court Judge Ketanji Brown Jackson denying plaintiffs' motion for a preliminary injunction. Plaintiffs in the lawsuit are the National Cattlemen's Beef Association, National Pork Producers Council, American Meat Institute, American Association of Meat Processors, Canadian Cattlemen's Association, Canadian Pork Council, North American Meat Association, Southwest Meat Association and Mexico's National Confederation of Livestock Organizations. On August 19, the court granted a motion by the United States Cattlemen's Association (USCA), National Farmers Union (NFU), the American Sheep Industry Association (ASI) and the Consumer Federation of America (CFA) to become defendant-intervenors in the lawsuit.

FED CHIEF MAY BE COMING TO A HEAD... The Nikkei news service is reporting this morning that President Obama is set to name former Treasury Secretary Larry Summers to replace Ben Bernanke as the Chairman of the Federal Reserve. An announcement could be made next week after the FOMC's latest policy meeting, when the Fed could decide to start tapering. However, doubts about the report exist. "You have to wonder just how credible it is. I mean it would be understandable if the New York Times or the Wall Street Journal were reporting this," says one trader, probably speaking for many. The White House has said that no decision has been made and President Obama will make his announcement this fall. Meanwhile, more congressional opposition in cropping up to Summers, as the No. 2 Republican in the Senate, John Cornyn (R-Texas) has said he would oppose Summers if nominated as Fed chief. Already, at least two Democrats on the Senate Banking Committee have said they would oppose Summers and a third is said to be leaning that way. Democrats control the panel 12-10 and would have to rely on Republican support should Summers be nominated to head the Fed.

U.S. ON TRACK FOR SMALLEST DEFICIT SINCE FY 2008... The government took in $185 billion in revenue last month, an August record, while spending $333 billion to post a deficit of $148 billion, just below expectations. That puts the 11-month deficit at $755.3 billion. With only one more month left in FY 2013, the year-to-date shortfall totaled $755.3 billion. That is expected to shrink when the September budget results are released sometime in October, as the Congressional Budget Office has projected September will post the fourth monthly surplus of the budget year, thanks to quarterly tax payments. If so, it would be the first year since FY 2008 that the federal government will have a deficit of under $1 trillion.

CASH CATTLE TRADE GETS UNDERWAY... Cash cattle began trading at steady $123 prices in Texas and Kansas late Thursday after packers unexpectedly raised bids from $121 earlier in the day. With packers raising bids to even money with week-ago sooner than anticipated, some feedlots may hold out for higher bids later today.

PORK CUTOUT DROPS AND MOVEMENT SLOWS... The pork cutout value was $1.31 lower Thursday as all cuts declined and packers saw movement slow to 290.4 loads. While it's premature to say the pork product market has put in a seasonal top, hog traders will be watching more closely for topping signals following Thursday's performance. That could be enough to trigger profit-taking in futures ahead of the weekend.

OVERNIGHT DEMAND NEWS... Japan is seeking 9,000 MT of milling wheat and 3,000 MT of malting barley.

 

GOOD MORNING!

WEAKER PRICE ACTION OVERNIGHT... As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are fractionally to 2 cents lower, SRW wheat futures are 5 to 6 cents lower, HRW wheat futures are 4 to 5 cents lower and HRS futures are steady to 2 cents lower. The U.S. dollar index is firmer this morning.

EPA EXPECTED TO RELEASE INITIAL RFS VOLUME REQUIREMENTS FOR 2014 THIS MONTH... Our best sources signal the corn-based ethanol volume requirement could be announced at no lower than 13.8 billion gallons (same as 2013), but no higher than 14 billion gallons. If so, those figures would be below the 14.4-billion-gallon figure contained in 2007 energy legislation detailing the mandate levels. EPA has said it would finalize the requirements for ethanol and other biofuels by June 2014.

PLAINTIFFS APPEAL COURT RULING DENYING PRELIMINARY INJUNCTION IN COOL LAWSUIT... Plaintiffs in the country of origin labeling (COOL) lawsuit filed a notice of appeal yesterday of the September 11 ruling by US District Court Judge Ketanji Brown Jackson denying plaintiffs' motion for a preliminary injunction. Plaintiffs in the lawsuit are the National Cattlemen's Beef Association, National Pork Producers Council, American Meat Institute, American Association of Meat Processors, Canadian Cattlemen's Association, Canadian Pork Council, North American Meat Association, Southwest Meat Association and Mexico's National Confederation of Livestock Organizations. On August 19, the court granted a motion by the United States Cattlemen's Association (USCA), National Farmers Union (NFU), the American Sheep Industry Association (ASI) and the Consumer Federation of America (CFA) to become defendant-intervenors in the lawsuit.

FED CHIEF MAY BE COMING TO A HEAD... The Nikkei news service is reporting this morning that President Obama is set to name former Treasury Secretary Larry Summers to replace Ben Bernanke as the Chairman of the Federal Reserve. An announcement could be made next week after the FOMC's latest policy meeting, when the Fed could decide to start tapering. However, doubts about the report exist. "You have to wonder just how credible it is. I mean it would be understandable if the New York Times or the Wall Street Journal were reporting this," says one trader, probably speaking for many. The White House has said that no decision has been made and President Obama will make his announcement this fall. Meanwhile, more congressional opposition in cropping up to Summers, as the No. 2 Republican in the Senate, John Cornyn (R-Texas) has said he would oppose Summers if nominated as Fed chief. Already, at least two Democrats on the Senate Banking Committee have said they would oppose Summers and a third is said to be leaning that way. Democrats control the panel 12-10 and would have to rely on Republican support should Summers be nominated to head the Fed.

U.S. ON TRACK FOR SMALLEST DEFICIT SINCE FY 2008... The government took in $185 billion in revenue last month, an August record, while spending $333 billion to post a deficit of $148 billion, just below expectations. That puts the 11-month deficit at $755.3 billion and if September stays on track, we could be looking at the first year since FY 2008 that the federal government will have a deficit of under $1 trillion.

CASH CATTLE TRADE GETS UNDERWAY... Cash cattle began trading at steady $123 prices in Texas and Kansas late Thursday after packers unexpectedly raised bids from $121 earlier in the day. With packers raising bids to even money with week-ago sooner than anticipated, some feedlots may hold out for higher bids later today.

PORK CUTOUT DROPS AND MOVEMENT SLOWS... The pork cutout value was $1.31 lower Thursday as all cuts declined and packers saw movement slow to 290.4 loads. While it's premature to say the pork product market has put in a seasonal top, hog traders will be watching more closely for topping signals following Thursday's performance. That could be enough to trigger profit-taking in futures ahead of the weekend.

OVERNIGHT DEMAND NEWS... Japan is seeking 9,000 MT of milling wheat and 3,000 MT of malting barley.

 

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