World Remains Focused On Ukraine

The world remains focused on events in and around Ukraine this morning, but it is apparent that conditions there are less worrisome to investors than they were on Monday. \r\n   European and US stock prices have already regained Monday’s losses and appear this morning to be headed higher.  Commodity funds Tuesday took agricultural futures higher, and while some of the push is being taken out of grain and soybean futures in overnight trading, the markets retain a firm tone.\r\n   Russia appears to be relaxing a bit over events in Ukraine, now that forces in Crimea appear to have the region controlled.  Russian President Vladimir Putin isn’t claiming the armed, unmarked men surrounding key airports, roads and ports, but on Tuesday he did order tens of thousands of Russian troops to return to their bases after participating in military exercises near Ukraine’s border.\r\n   Today, US Secretary of State John Kerry is to meet with his Russian counterpart, Foreign Minister Sergei Lavrov in Paris to talk about the crisis.  News analysts say that despite sharp differences of opinion going in, Russia and the US appear to prefer a dialogue.\r\n   The BBC this morning quoted Putin saying, “It is not necessary to whip things up and place political considerations on top of issues of economic cooperation.”\r\n   Behind it all is Ukraine’s economic crisis.  The country needs an infusion of cash, which the IMF and the EU have promised could be available, although available funds likely would fall far short of the need.  The US also is looking for ways to infuse cash into the region.\r\n   Reuters reported the head of Russia’s top natural gas producer, Gazprom, says Ukraine has informed the company it cannot pay for February gas deliveries in full.  \r\n   Corn markets Tuesday caught fire and led the charge to higher ground in grains, soybeans and livestock, market analysts said.  No particular fundamental news was thought to be behind the interest, although AgResource said with the charts pointing upward, a few fund managers were willing to invest in long positions heading into the Northern Hemisphere growing season.\r\n   Corn may have gotten some extra support from continued logistical snarls in Canada that are causing delays in oats shipments.\r\n   Tuesday’s rally was welcomed by producers since typically, the markets tend to weaken before planting begins as traders assume adequate growing weather and trendline yields.\r\n   Corn appears to be overbought technically, especially with no break in Black Sea shipping related to the Ukraine political unrest.  Traders may be ready to take some short-term long profits soon if there is any indication of a break in the weather.\r\n   Current forecasts call for some sustained warmth by next week.  Highs may get into the 60s in the south as the line of freezing temperatures moves north, reigniting thoughts of spring planting there.  \r\n   Warmer temperatures also will aid transportation efforts on the nation’s rivers, railroads and highways.  Economists estimate that billions of dollars in commerce have been lost to this winter’s extreme conditions.  Even the Federal Reserve’s Beige Book, which gives insight into the US economic condition, gives ground to the harsh winter when talking about employment and economic growth.\r\n   Lean hog futures Tuesday marked its third straight day of record prices, moving up the daily limit of $3.00 per cwt, where they closed.  Concerns over pork supplies because of high death losses related to the Porcine Epidemic Diarrhea virus were cited for the climb.\r\n   Traders also said hogs got a boost from rumors Russia might resume buying ractopamine-free US pork. \r\n   No cash cattle trading was reported Tuesday.  No packer bids were reported, but cattle owners were asking mostly $154 per cwt on a live basis and $245 to $246 dressed for this week’s showlist cattle since boxed-beef prices continue to rise.\r\n   The USDA reported its choice cutout value Tuesday at $231.76 per cwt, up $2.64, while the select cutout rose $1.93 to $229.74.  The choice/select spread widened to $2.02, but there were only 86 load of fabricated product sold into the spot market.\r\n   The CME Feeder Cattle Index for the seven days ended Monday was $171.98, up $0.69 while the March futures contract closed Tuesday at $172.90, up $1.12.\r\n