Good morning!
Quiet grain trade overnight... Corn and soybean futures modestly favored the downside in quiet overnight trade while wheat firmed. As of 6:30 a.m. CT, corn and soybean futures are trading fractionally to a penny lower, winter wheat markets are 4 to 5 cents higher and spring wheat is mostly 2 cents higher. The U.S. dollar index is more than 300 points higher and front-month crude oil futures are about 65 cents lower.
Weekly Export Sales Report out this morning... For the week ended Feb. 13, traders expect:
| 2024-25 expectations (in MT) | Last week (in MT) | |
| Corn | 900,000-1,600,000 | 1,648,982 |
| Wheat | 300,000-600,000 | 569,561 |
| Soybeans | 100,000-500,000 | 185,502 |
| Soymeal | 200,000-550,000 | 336,736 |
| Soyoil | (5,000)-15,000 | (2,843) |
India refiners cancel more palm oil orders... Indian refiners have canceled up to 100,000 MT of crude palm oil (CPO) orders scheduled for March-June delivery due to rising prices, Reuters reports. An initial cancellation was reported Thursday, with an additional 30,000 MT canceled by early Friday. CPO prices have surged over 11% in the past four weeks. Meanwhile, imports of soybean oil for Feb.-March arrival have increased due to its more favorable pricing compared to CPO.
French wheat crop ratings improve slightly... France’s ag ministry rated the country’s winter wheat crop as 74% good/excellent as of Feb. 17, up one percentage point from the previous week. The crop is rated better than last year’s 69% good/excellent level at this time, though that was a four-year low.
China to boost ratoon rice production in effort to strengthen food security... China’s ag ministry will ramp up support for ratoon rice cultivation starting this year, with plans to expand production by around 667,000 hectares by 2030, as part of a broader effort to boost crop yield and strengthen food security. The ministry plans to improve seed varieties, farming practices, and policy support in regions with potential for ratoon rice. Ratoon rice is a type of rice re-grown from the root stubs left after the first harvest, allowing for a quicker second harvest to boost rice production in some regions. The new target represents a 66.7% increase in production by 2030 compared to 2022 levels.
Euro zone business activity shows tepid growth in February... HCOB’s preliminary composite euro zone purchasing managers index compiled by S&P Global held at 50.2 in February. The tepid growth was fueled by the services sector, despite a slowdown, while manufacturing activity contracted at the slowest pace in nine months.
USDA releases first tranche of paused funding under IRA review... USDA Secretary Brooke Rollins announced her agency will release the first tranche of funding that had been paused due to a review of Inflation Reduction Act (IRA) allocations. Following White House directives, USDA is honoring existing contracts with farmers, releasing approximately $20 million for the Environmental Quality Incentive Program, the Conservation Stewardship Program and the Agricultural Conservation Easement Program. Rollins criticized the Biden administration’s handling of IRA funding but affirmed commitments to farmers who had already made investments. This marks the initial phase of released funding, with further announcements expected as USDA continues its review to ensure taxpayer dollars support farmers and ranchers rather than unrelated initiatives.
Senate passes ‘skinny’ budget, setting stage for GOP Showdown... The Senate early this morning passed its “skinny” budget resolution after a lengthy vote-a-rama, marking the first step toward enacting President Donald Trump’s legislative agenda. While Trump initially favored the broader House GOP resolution, Senate Republicans successfully maneuvered to keep the process moving, securing his approval. This provides Trump flexibility should the House plan falter. However, Speaker Mike Johnson (R-La.) faces a challenge rallying his slim majority to support the House resolution, which includes controversial spending cuts. Moderates are wary of the proposed $880 billion in Medicaid-related reductions, fearing backlash from constituents are supporting the resolution to advance negotiations. Meanwhile, Congress faces a March 14 government funding deadline with no agreement in sight. Without progress soon, a government shutdown looms.
NCC seeks rule change to divert 400 million eggs to market... The National Chicken Council (NCC) has petitioned FDA to lift a regulation preventing broiler industry eggs from entering the food supply, arguing the move could ease record egg prices caused by the highly pathogenic avian influenza (HPAI) outbreak. The 2009 rule forces broiler producers to discard surplus hatching eggs instead of selling them to processors, despite government risk assessments affirming their safety. If granted, the request would allow nearly 400 million eggs annually to be used in processed foods like bread, pasta and mayonnaise, alleviating strain on table egg supplies. As we have noted before, NCC previously sought relief under the Biden administration in 2023 but was denied. Now, with egg prices soaring, the organization is urging swift action from the Trump administration.
Rollins pledges support for farmers amid HPAI concerns... USDA Secretary Brooke Rollins held a roundtable Thursday with farmers from multiple states to discuss HPAI and broader agricultural challenges. She emphasized collaboration with the White House to combat HPAI, assist poultry farmers and lower grocery costs, particularly egg prices. Rollins also addressed expanding access to capital for young farmers, reducing input costs and ensuring disaster relief. She reaffirmed USDA’s commitment to honoring financial promises to farmers.
Placements the focal point in Cattle on Feed Report... Analysts surveyed by Reuters expect USDA to show the Feb. 1 large feedlot inventory (1,000-plus head) down 0.8% from year-ago in this afternoon’s Cattle on Feed Report. Placements are expected to be up 2.2% from last year, though the pre-report range extends from down 1.7% to up 6.1%, making that the key figure in the report. The U.S. had not reopened the border to Mexican cattle imports in January, though the year-ago figure was the lowest in eight years. January marketings are expected to be up 2.1% from last year.
Wholesale beef prices continue to fall... Choice boxed beef prices fell another $1.26 to $312.63 while Select dropped 58 cents to $303.18. Packers are slowing slaughter runs amid deeply negative margins, but that hasn’t supported wholesale prices as retailer beef buying remains seasonally weak.
Cash hog index, pork cutout going in opposite directions... The CME lean hog index is up another 24 cents to $91.22 as of Feb. 19, extending the rebound from the seasonal low on Jan. 9, though that’s the smallest daily gain in a couple of weeks. The pork cutout fell another $1.49 to $94.03 Thursday, pressured primarily by primal bellies that dropped another $7.46.
Overnight demand news... Exporters reported no tenders or sales.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
- 7:30 a.m. Weekly Export Sales — FAS
- 2:00 p.m. Cattle on Feed — NASS
- 2:00 p.m. Milk Production — NASS
- 2:00 p.m. Peanut Prices — NASS
- 2:00 p.m. Poultry Slaughter — NASS