First Thing Today (VIP) -- September 7, 2012

September 7, 2012 01:33 AM


CORN AND WHEAT MIXED, BEANS LOWER OVERNIGHT... As of 6:30 a.m. CT, corn futures are narrowly mixed with a slight upside bias, soybeans 7 to 13 cents lower and wheat futures narrowly mixed at all three locations. The U.S. dollar index is lower this morning.

JOBS GROWTH EXPECTED TO SLOW... The U.S. economy is expected to have added 125,000 non-farm payrolls last month based on the average guess of economists polled by Reuters ahead of this morning's monthly employment report from the Labor Department. That would be down from a gain of 163,000 jobs in July, but the "whisper" number is increasing after ADP private-sector jobs data came in stronger than expected yesterday. Economists see the unemployment rate holding steady at 8.3%.

INFORMA CROP ESTIMATES OUT THIS MORNING... Informa Economics will issue updated production estimates for corn, soybeans and cotton at 10:30 a.m. CT. The report will include two production forecasts for corn and soybeans. One will be based on
USDA’s current planted acreage estimates and September yield forecasts. The second will feature certified acreage data from USDA’s Farm Service Agency and may include yields that reflect Informa’s likely final projections.

WEEKLY EXPORT SALES ALSO OUT THIS MORNING... For the week ended Aug. 28, traders expect: corn sales between 200,000 and 350,000 MT; wheat sales between 450,000 and 650,000 MT; soybean sales between 700,000 and 900,000 MT; soymeal sales between 150,000 and 200,000 MT; and soyoil sales between 15,000 and 35,000 MT.

RUSSIA MAY HAVE TAPPED WHEAT RESERVES FOR EXPORT… As the focus remains on Black Sea exportable wheat supplies, contacts indicate that Russia may have already tapped up to 3 MMT of government wheat reserves as a way to avert export limits. If so, that could be a tempering factor on wheat markets as traders continue to expect the country will limit exports at some point. So far, their grain exports in 2012-13 have totaled 5.3 MMT. Meanwhile, Russian President Vladimir Putin today predicted the country’s grain output by 2020 will reach 120 MMT to 125 MMT, with an exportable surplus of 35 MMT to 40 MMT.

STILL WAITING FOR CASH CATTLE TRADE... Cash cattle negotiations remain slow in the Plains, but with feedlots reportedly passing on $122 bids in Texas Thursday, odds of higher cash cattle prices compared with last week's $122 to $123 trade are increasing. Given tight market-ready supplies, feedlots appear willing to wait on packers to come with firmer cash cattle prices, which suggests active trade may not be seen until late today.

PORK PRICES POST MODEST REBOUND... The pork cutout value firmed 50 cents yesterday to recoup a fraction of Wednesday's sharp plunge, but is still down more than $3 from week-ago. While packer margins are deep in the black, the falling pork prices and abundant market-ready hog supplies will keep cash hog bids under pressure.

OVERNIGHT DEMAND NEWS... One South Korea feed maker purchased 65,000 MT of U.S. or South American corn and 55,000 MT of optional origin feed wheat. Another South Korean feed maker bought 134,000 MT of South American corn and passed on a tender for up to 70,000 MT of feed wheat. And yet another South Korean feed maker tendered for 55,000 MT of optional origin corn, excluding Chinese and Indian supplies. India tendered to sell 30,000 MT of milling wheat.


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