HIGHLIGHTS

·         Market Trend:  Corn, Up 2; Soybeans, 1-2 Higher; Wheat, 4-5 Higher   

·         HSBC’s preliminary report from Chinese factory purchasing managers showed a slow-down in January activity.  This follows data from earlier in the week indicating a slowing 4^th quarter economy;  Asian markets reacted negatively.  Shanghai lost a ½%; the Nikkei fell .8% and the Hang Seng posted a 1 ½% decline. Europe, on the other hand, came through with highest manufacturing output figure in nearly 3 years, boosting the euro but pressuring the major equity markets—the FTSE, DAX and CACV-40 were all off .13-.18% in early trading.  U.S. futures are in the red:   Dow, -79; S&P, off 7 ¾ and the Nasdaq, 7 lower. Gold prices $7 to the plus side at $1,245.60/oz; the energies are mixed and the $ Index is a 1/3^rd of a point lower at 80.965 on the March contract

·         T-storm Weather: Heat breaks through tonight across Argentina, which causes rounds of thunderstorms to erupt in key and driest areas.  Several days of coolness follow, but temps gradually warm to near-average levels early next week.  Thunderstorms are expected to return Jan. 28-31.  To the north, heat and drying break Friday-Sunday in South Brazil and Paraguay to maintain or improve soil moisture. Thunderstorms affect driest areas of/adjacent to Southeast Brazil over the next few days, but highest coverage and amounts focus to the west (across Mato Grosso where first-crop harvesting/second-crop planting is underway)

·         Mar Corn Up $.0250 at $4.2875; May Up $.0250 at $4.3550.  Funds bought 2 K Wednesday

·         Mar SB Up $.0175 at $12.8125; May SB $.02 at $12.67.  Funds bought 2 K SB, 3 K SBM and sold 2 K SBO

·         Mar Wheat Up $.0450 at $5.6575; May Wheat Up $.0425 at $5.7225.  The funds were even yesterday 

CORN/SORGHUM

·         T-storm Weather: Despite recent rainfall across Argentina corn areas, considerably more is still needed because most were drier than average over the last 30 days and departures since Dec. 1generally range from -2.00” to -5.00”

·         ATI Research: The inability to get cars forced ethanol plants to scale back production for the week ending Jan. 10, as output fell 51 thousand barrels per day to 868 thous.  Implied corn grind dropped from 101mbu to 95.4

·         USDA reports December 1, 2013 on-farm U.S. grain storage capacity increased 0.5% from 2012; off-farm up 1.4%

·         Indications point to a reduction in planting of double-crop corn acreage in Brazil in February relative to last year

SOYBEANS/WHEAT

·         T-storm Weather: Heavy rains are needed across key soybean producing areas of Brazil (Bahia, Goias and Southeast Brazil) where 20% of total nationwide output occurs

·         ATI Research: NOPA report shows U.S. December soybean crush set a record for the month at 165.4mbu

·         T-storm Weather: Precipitation over the last 90 days has been near-ideal for U.S. SRW wheat with 78% of production having received near-average moisture totals

·         ATI Research: Despite recent contract lows in wheat futures, there is little confirmation of fresh export demand

ENERGY

·         Energy markets are mixed: QCLH14,+$0.05 at $96.78; QRBH, -$0.0053; QNGH,+$.133 and QHOH, -$.033

·         Cash ethanol markets continued to decline on Tuesday: Chicago was off 7 ½; Tampa dipped 3; Gulf was a nickel lower; Dallas slid 2 ½; New York fell 13; &  LA was 1 ½ weaker at $2.24 per gallon

·         EAI Stocks estimates (API):  crude, +1.2 mb (+4.9); gasoline, +1.7 mb (+1.1); distillates, -.8 mb (-2.3)

·         RINs were steady to firmer: 2012’s gained ½ to 31-32 ½; 2013’s unch at 31 ½-32 ¾; and 2014’s up ½ at 31 ¼-32 ½

·         The February RBOB/February ethanol spread was under pressure, losing close to 9 cents at $.8251/gallon

LIVESTOCK/POULTRY                                       &​nbsp;                   

​

·         Cash cattle traded yesterday at a record high $147, up $5 from last week, which was also a record high

·         Choice boxed beef values gained 33-cents yesterday to set a new record high for a tenth consecutive day of $240.05

·         The USDA mandatory pork carcass cutout value eased 11-cents yesterday and has lost 94-cents over the last two days

·         USDA Cold Storage report showed total pork supplies increased at their fastest pace for December in five years and were record large for the month

Sources: Bloomberg, Dow Jones, AP, T-storm Weather