Midwest Fieldwork Remains Stalled

4-3-14 – Midwestern fieldwork remains stalled this morning by rain-soaked and cold fields, although some limited planting may resume in southern states.\r\n\r\n   Much of the Midwest continues to receive rain, although the Plains and Southeastern states are drier.  More rain, however, is forecast for next week but will leave the western Plains parched, and only northern California is expected to receive significant showers.\r\n\r\n   The National Weather Service also has a winter storm warning for northeastern Nebraska, eastern South Dakota, southern Minnesota and northern Wisconsin and Michigan.  http://forecast.weather.gov/wwamap/png/US.png \r\n\r\n \r\n\r\nGRAIN, SOYBEANS UP OVERNIGHT\r\n\r\n \r\n\r\n   Grain and soybean futures prices are up in overnight trading as planting delays spark speculative buying by the funds. \r\n\r\n   However, continued efforts by Chinese importers to sell soybeans, and meal is capping gains in the soy complex.  There are even rumors that a US poultry producer has purchased Brazilian soymeal.\r\n\r\n   The soy complex also could see pressure from outright cancellations of soybean orders amid financing issues for the importer.\r\n\r\n   And world farmers are showing a rising willingness to unlock the bin doors at current prices, which is capping or even pressuring gains in the basis.\r\n\r\n   Corn is getting support from reports that ethanol margins remain strong, resulting in a 14% weekly production increase over last year.  But excitement is tempered by further analysis that blending margins are tightening, which likely will lead to less ethanol (corn) demand.\r\n\r\n \r\n\r\nRABOBANK SEES POULTRY OPPORTUNITY\r\n\r\n \r\n\r\n   Rabobank economists are predicting a good year for US poultry producers as rising red meat prices push consumers toward chicken.  Tightening supplies of beef and pork are taking prices to record levels with no signs of retreat, while US chicken supplies potentially can be ramped up comparatively quickly.\r\n\r\n   That’s not the case for world poultry markets, however, Rabobank said.  Rising world grain prices from worries about a pending El Nino and political unrest in Ukraine may boost second-quarter feed prices, while bird flu in China and a weakening Asian economy may make it rough for producers there.\r\n\r\n \r\n\r\nCASH CATTLE TRADE STALLED\r\n\r\n \r\n\r\n   Cash cattle trading was stalled Wednesday, with packer buyers bidding $147 per cwt on a live basis, $3 to $5 less than last week, while feedlots are asking $153, $1 to $2 higher than last week.  No dressed-basis bids were reported, but asking levels were said to be around $246, up $3 from last week.\r\n\r\n   Packer buyers are tougher negotiators this week as beef prices weaken and take margins along.  The USDA cutout was up Wednesday amid stronger spot sales, but the overall tone is weaker.\r\n\r\n   The USDA reported its choice cutout value Wednesday up $1.10 per cwt at $233.64 and select up $0.71 at $223.66.  Compared with Friday’s cutout, choice is down $0.82, and select is off $3.68.  There were 215 loads of fabricated product sold into the spot market.\r\n\r\n   Weekly slaughter was 349,000 head, compared with 351,000 last week and 347,000 last year.\r\n\r\n   The CME Feeder Cattle Index for the seven days ended Tuesday was $177.66, down $0.15 while the April futures contract settled Wednesday at $177.22, up $0.77.\r\n\r\n   With cool to cold, wet conditions across the eastern half of the lower 48, grocery retailers were reluctant to chase wholesale prices any higher until they see more product walk out the door.  This weekend is the first weekend of the month, and thus, could be a strong sales weekend, but with back yard grills silenced, the prospects for strong retail beef sales aren’t good.\r\n\r\n   But fund traders also could be enticed by prospects for pent-up grilling demand once the weather warms.  April futures remain below last week’s cash trade and could lend pressure to this week’s cash trading. \r\n\r\n   Feeder cattle and calf markets remain strong despite dry pasture conditions that should be sending cattle to the feedlots.  This may be because the US herd size is finally showing the effects of more than a decade of liquidation. \r\n\r\n \r\n\r\nIN OUR OPINION\r\n\r\n \r\n\r\n–Pork producers say USDA may be underestimating the damage from PEDv.\r\n\r\n–JBS thought to be short bought on cattle for this week\r\n\r\n–EU showing strong interest in non hormone-treated beef\r\n\r\n–Oklahoma hoping for a drink for the wheat today or tomorrow