HIGHLIGHTS
· Market Trend: Corn, Down 1; Soybeans, SU, +6-7; SX, 1 Lower; Wheat, 3-4 Lower
· Global equities are lower this morning. Timing of a U.S. rate hike; economic sluggishness in China and an impending vote on Scotland’s move away from the United Kingdom are all cited as immediate concerns. Shanghai fell .3% on a 2.4% shrinkage in August imports and slowing mfg activity. Hong Kong finished 1.9% lower while the Nikkei salvaged a .3% rise. FTSE,-.4%; DAX, steady; CAC 40, +.11%. U.S. futures: Dow, +14; S&P, +1.50; NAS, +7.25. Externals: energy, mixed; gold, +$6.20; $ Index, -.139
· T-Storm Weather: Copious amounts of rain are being unleased across the central Plains as a powerful system develops. Rainfall will be widespread in and adjacent to the Corn Belt over the next two days, creating pockets of field flooding across the northwest half of the Corn Belt. Flash Flood Watches are widespread. A second system is not far behind, which will result in light rain across the central and southern Plains Thursday-Friday. Temps will turn significantly cooler but a killing frost is not expected to bring the growing season to an end for the northern Plains Thursday through Saturdaymornings with minimums reaching 33°F - 36°F range but potentially colder in parts of the Dakotas and Montana.
· Sep Corn Down $.0050 at $3.3575; December Down $.0050 at $3.4375. Del’y: 0 C. The funds sold 6 K on Tuesday
· Sep Soybeans Up $.0675 at $10. 8325; Nov Down $.01 at $9.9175. Del’y: SBO, 55. The funds sold 8 K SB & 5 K SBM; 5 K SBO
· Sep Wheat Down $.0350 at $5.24; December Down $.0350 at $5.24. Del’y: 10 HRW; 0 SRW. The funds sold 5 K in yesterday’s
CORN/SORGHUM
· Corn trades to a new contract low on consolidation, less of a cold weather threat: CZ touches $3.43/bu
· “Typical”, near-by Midwest ethanol plant margins move above $.90 on lower corn prices
· Average trade estimate for tomorrow expects USDA to raise corn yield by 3.3 bpa to 170.7 (range: 168.5-174.1)
· Trade expecting weekly ethanol output to decline 15-35 K barrels per day from LW’s 921 K figure
· Buying frenzy: export sales to W Hemi destinations at a 15 year high starting 14/15, more than just Mexico but not enough to offset 122 mbu decline in sales to China—1st quarter Gulf export implications??
SOYBEANS/WHEAT
· SX falls below $10.00 per bushel, a key support point and hits a contract low of $9.90 on Tuesday
· Trade expects USDA to boost soybean yield 0.9 bpa to a record 46.3 (range: 45.5-48.0)
· Some see possibility of USDA boosting Russian wheat crop from 2-4 MMT on Thursday
· Australia’s wheat crop is in need of additional rains to prevent further down-grades in output
· U.S. soybean ratings are the highest in 20 years
ENERGY
· Futures are ½ and ½: QCLV14, +$0.11 at $92.86; QRBV,+$0.0059; QNGV, -$.032; and QHOV, -$.0060
· EIA estimates (API): crude, -1.2 mb (-1.9); gasoline, unch (+0.7); distillates, +0.6 (+1.7)
· Cash ethanol markets were noticeable lower yesterday: NY led with an 8 ½ cent decline; the Gulf was 7 lower; Tampa/Dallas lost 6 to 6 ½; Chicago backed off 5 ¾ cents to $2.04 and LA slipped 2 ½ cents
· RINs were again weaker: 2012’s down 1 ¼ 46 ½-48; 2013’s off 1 ¼ to 47-48; and 2014’s were 7/8’s lower at 47 ½-48 ¾
· The October RBOB/Ethanol spread widened $.0395 per bushel to $.6144 on weakness in corn
LIVESTOCK/POULTRY </wbr>
· After increasing $5.28 during the previous four trading days, Choice boxed beef values eased 31-cents yesterday
· The USDA 5-area weekly average steer price for last week was $161.28 on a live basis, up $5.83 from the week before
· The USDA pork carcass cutout value increased $2.13 yesterday and has gained $2.78 over the last two days
· CME Lean Hog Index up $1.00 to $97.79. October futures up $2.70 to $105.775 and are $7.985 above the index
Sources: Bloomberg, Dow Jones, AP, T-storm Weather