First Thing Today (VIP) -- September 14, 2012

September 14, 2012 01:37 AM


PRICE STRENGTH THIS MORNING... Markets continue to react to Fed's third round of quantitative easing (QE3) yesterday. The Fed move is giving traders more confidence to add risk. As of 6:30 a.m. CT, corn futures are trading 3 to 8 cents higher, soybeans mostly 10 to 14 cents higher, Chicago and Kansas City wheat 8 to 15 cents higher and Minneapolis wheat 5 to 9 cents higher. The U.S. dollar index is under heavy pressure.

HOUSE PASSES SIX-MONTH SPENDING BILL; SENATE TO FOLLOW NEXT WEEK... The House passed a six-month stop-gap spending bill Thursday, voting 329-91 to pass the continuing resolution (CR). The 70 Republican opponents of the measure outnumbered Democrats (21) voting against it by a more than 2-to-1 margin. The CR would fund the government through March 27 and increase spending by 0.6% for most federal programs and agencies. Next week the Senate is expected to clear the measure, which congressional leaders and the White House negotiated in advance. The House CR, as expected, did not contain any extension of the 2008 Farm Bill. It looks like new farm bill issues will be considered at the earliest in the post-election, lame-duck session of Congress.

HOUSE DEMOCRAT FILES DISCHARGE PETITION TO FORCE FARM BILL VOTE... Rep. Bruce Braley (D-Iowa) filed a discharge petition seeking to require the House to vote on the stalled farm bill that was approved in July by the Agriculture Committee. The measure faces major hurdles. The House would be required to vote on the bill if at least 218 members sign the petition. According to a report by the Congressional Research Service, few discharge petitions ever get 218 signatures, "and for those that do, the process usually takes some months."

CRUSH PACE EXPECTED TO SLOW, BUT REMAIN STRONG OVERALL... NOPA members are expected to report soybean crush totaled 128.3 million bu. in August, according to the average, pre-report guess. That would be down 6.6% from the July pace, but 8% higher than Aug. 2011. Soyoil stocks are guessed at 2.213 billion pounds.

ARGENTINA CONFIRMS ADDITIONAL 2011-12 CORN EXPORTS... Last week, industry sources said the Argentine government freed up an additional 2.75 MMT of 2011-12 corn for export, but there was no official confirmation from government sources. That confirmation came from the country's ag minister today. Argentina will now allow exports on up to 16.45 MMT of the 2011-12 corn crop. The ag minister also said recent rains in key growing regions will be beneficial for 2012-13 corn and soybean production.

THE DIFFERENCE FOR LIVESTOCK MARKETS IS SUPPLIES... Beef packers are cutting in the red and yet they are still paying higher prices for cash cattle, while pork plants are enjoying strong margins but continue to lower cash hog bids. The difference is supplies. Market-ready cattle supplies are tight, while hog supplies are burdensome. As a result, the respective cash markets are trading counter to what packer margins would suggest.

OVERNIGHT DEMAND NEWS... Japan tendered for 32,000 MT of milling wheat.


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