HIGHLIGHTS
· MARKET TREND: CH, Down $.50 SH, Up $.0150; WH, Up $.0175; KWH, Up $.0425
· Markets re-think Fed chairwoman’s comments—a 2016 rate hike may still be on the table; Rio Tinto posts loss; oil prices continue to weaken; financials hit especially hard. Nikkei/Shanghai are both closed; Hang Seng falls 3.9%. Mid-day Europe again in the red with losses ranging from 2.2% (FTSE) to 3.3% (CAC 40). U.S. futures are not well: DOW, down 281; S&P, 33 ¼ lower; NAS, off 79 ½. Outside markets: Mar WTI is off $1.06; Gold is sharply higher, +$36.60 and the $ index is off 1/3rd point at 95.58
· T-storm Weather: Widespread coverage of near- and above-normal rain affects Argentina, Brazil, and Paraguay over the next 10 days. Most notably, periods of heat occur between thunderstorms in Argentina, and thunderstorms gradually expand across northern areas of Center-West and Southeast Brazil through the weekend, gradually slowing harvesting and planting from southwest to northeast until a stormier pattern fully unfolds next week. In the U.S., a large and unseasonably warm upper-level high dominates the West through early next week. The setup dislodges Arctic air to the east, keeping the Corn Belt and points east unseasonably cold for several days, but SRW wheat winterkill is not expected as minimums stay in the +0s or warmer
· CH, Down $.050 @ $3.5975; CK, Down $.0075 @ $3.6450. The funds sold 2 K at mid-week
· SH, Up $.0150 @ $8.6375; SK, Up $.0125 @$8.6825. The funds sold 1 K SB, 2 K SBM and bought 2 K SBO
· WH, Up $.0175 @ $4.63; WK, Up $.0225 @ $4.6725. The funds were buyers of 3 K yesterday
CORN/SORGHUM         ;
· Export Sales to be released at 7:30 AM CST. Trade expects 31-43 mbu for 15/16 corn
· ATI Research: U.S. corn exports generally trend seasonally higher but it is unlikely that they match last year’s near-term average of 35.0 mbu per week; expect 25.0 or so
· T-storm Weather: Thunderstorms impact areas of Center-West Brazil next week. Rain amounts of 2.25”-4.50” are most probable, slowing double-crop corn planting with time
· Ethanol grind: 969,000 barrels/day for week end Feb. 5—up 1.0% vs. last week and 0.8% higher vs. last year
SOYBEANS/WHEAT
· Export Sales report. Trade expects 11-22 mbu for 15/16 soybeans; soymeal, 100-250 K MT; and soyoil, 5-20 K MT
· ATI Research: U.S. soybean export inspections over the past month have fallen from 52.6 mbu per week, down to 45.0. Expect the current pace to work lower to the high 30.0 mbu range
· Export Sales report. Trade expects 6-13 mbu for 15/16 all wheat
· T-storm Weather: Dryness continues to emerge across the U.S. Southern Plains where 62% and 83% of HRW wheat production in Oklahoma and Texas received less than half its normal precipitation over the last 30 days
ENERGY
· Mixed: CLH16, -$1.06, $26.4; EBJ, -$0.44; EBJ-CLH, +$4.00, +$.61; RBH, +$.0003; NGH, +.033; HOH, -$.0096
· A weaker trend was noted in cash ethanol markets on Wednesday: Chicago eased 2; New York off 1 ¾; Gulf, Dallas and Tampa declined 1 ½; and LA was 1 ¼ lower at $1.52 ¾ per gallon
· Ethanol RINs were mixed: 2014’s down ¼ to 71-71 ½; 2015’s up 1/8 to 71 ¼-71 ½; and 2016’s firmed 1/8 to 71 ¼-71 ½
· The March RBOB/March Ethanol spread gave up $.0626, settling at -$.4405 per gallon
LIVESTOCK/POULTRY    
· On Wednesday, choice boxed beef values firmed 16-cents, but at $218.19 are still $4.38 lower vs. last week
· Live bids for cash cattle on Wednesday were $134 in the South while dressed bids in the North were $206
· The USDA mandatory pork carcass cutout was up 25-cents Wednesday, but at $76.93 is down 20-cents vs. a week ago
· CME Lean Hog Index was $0.40 higher at $65.29. February futures gained $0.30 but are still $0.14 below the index
Sources: Bloomberg, Dow Jones, AP, T-storm Weather