HIGHLIGHTS
· Market Trend: Corn, Down 2-3; Soybeans, Down 5-6; Wheat, Up 3-4
· Tuesday’s rally in oil and a 1.8% yr to yr gain in Japanese labor income helped push some Asian markets higher: the Nikkei rose nearly 2%; the Hang Seng was a ½% higher while Shanghai lost ground to close .93% lower. Europe’s optimism over the Greece debt proposal moderates but markets come off session lows after China bank cuts reserve requirements: Both the CAC and DAX are .15-.20% lower; the FTSE is down .60%. Futures have U.S. markets leaning a little south after yesterday’s strong showing: DOW futures, down 4; NAS, -7 and the S&P, -3 1/4. Outside markets: energy is decidedly weaker; gold is $8.10 higher at $1,268.10 and the $ Index is ¼ point higher at 94.0
· T-storm Weather: A cool front drifts northward and triggers numerous thunderstorm clusters in parched areas of Center-West, Northeast, and Southeast Brazil, especially from today through Sunday-Monday. A new cool front approaches next week, but it is unclear whether it will stall to the south (leaving the region fairly dry next week), or sweep further to the north (thereby continuing the stormy pattern). To the south, some heat continues in central and western areas of Argentina due to the close proximity of upper-level high pressure, but a cool front (and rain) within Sunday-Tuesday limit potential for sustained heat
· Mar Corn Down $.0275 at $3.83; May Corn Down $.0250 at $3.9125. The funds bought an estimated 20 K on Tuesday
· Mar SB Down $.05 at $9.82; May Down $.0475 at $9.8825. Funds bought 15 K SB; 9 K SBM and again bought 6 K SBO
· Mar Wheat Up $.03 at $5.1675; May Up $.0325 at $5.25. The funds bought 7 K yesterday
· ATI Research: U.S. corn exports are forecast at 35 mbu per week over the next four weeks with a port split of 20-25 via the Gulf, 5-7 off the PNW and 4-5 via the Interior
· T-storm Weather: First-crop corn in Center-West, Northeast and Southeast Brazil benefits from rain this week but double-crop corn planting slows
· Private crop consultant: Potential for early end to rainy season in Brazil may curtail double-crop corn production
· Ethanol margins: $0.29 per gallon vs. $0.30 a week ago and below $0.49 last year. EIA report at9:30 AM CST
SOYBEANS/WHEAT
· ATI Research: Pace of U.S. soymeal shipments suggests USDA may be 300-500 K MT too high with its export forecast
· Private crop consultant: February rainfall could still impact yields for later maturing soybeans in Brazil
· T-storm Weather: Rain across parts of Center-West, Northeast and Southeast Brazil over the next week to slow soybean harvest
· ATI Research: U.S. all wheat exports are forecast to average 10-15 mbu per week over the next month
· T-storm Weather: Temps average warmer to much-warmer than usual for U.S. Plains HRW wheat through 10-14 days
ENERGY
· Futures are lower: QCLH15, -$1.40 at $51.65; QRBH, -$0.037; QNGH, -$.010; and QHOH, -$.0227
· EIA estimates: crude, +3.7 (API: +6.1); Gasoline, -0.3 (+2.0); Distillates, -2.2 (+0.3)
· Cash ethanol markets were firmer on Tuesday: Chicago, New York and Gulf climbed a nickel; Tampa and Dallas added 3; and LA was 4 ½ higher at $1.55 per gallon
· RINs steady to higher: 2013’s unchanged at 69-71; 2014’s up 1 ¼ at 72-73; and 2015’s gained 1 to 71-72
· The Mar RBOB/Mar Ethanol spread eased nearly a penny to $.1313/gallon—rally in corn; higher Brazil ethanol mix
LIVESTOCK/POULTRY ;
· ; Choice boxed beef values were 50-cents lower on Tuesday and are down $4.59 compared to last week
· Cash cattle trade was very slow on Tuesday with a few asking prices near $162 in the South
· On Tuesday, the USDA pork carcass cutout value declined $1.61 and is down $5.35 vs. a week ago
· CME Lean Hog Index 53-cents lower at $69.82. February futures up $0.875 to $67.20 and $2.62 below the index
Sources: Bloomberg, Dow Jones, AP, T-storm Weather