Market Closes – November 15, 2013

The soy complex closed sharply lower and at the day’s lows; losses started small early this morning and grew much larger as the day progressed. Several factors weighed on soy futures: favorable South American weather, disappointing soybean export sales, profit-taking by the spec funds, and a private 2014 soybean planted acreage forecast of a record 83.8 million acres.

Corn futures also closed sharply lower and at/near the day’s lows.  Corn was pressured by the sharp losses in soybeans and by the 1 pm announcement by EPA that the conventional ethanol mandate for 2014 will be cut to 12.7 – 13.2 billion gallons (this compares to 14.4 billion gallons prescribed by the original Renewable Fuel Standard (RFS) and the 13 billion gallon level “leaked” to the public weeks ago).  EPA will accept public comments for 60 days.  Read EPA release by CLICKING HERE.

Wheat futures closed mostly lower with many contracts making new lows for this fall’s move.  The MGEX December closed below previous chart support by a half-cent. As mentioned previously, wheat futures are flirting with breaking chart support and accelerating the recent downtrend.  Further weakness in corn/soybean futures ould would likely weigh on wheat.

Cattle futures were mostly higher today as fed cattle finally traded at $132/cwt, up a dollar from last week. However, boxed beef values weakened. Choice down 1.40 at 201.16; Select down 0.08 at 188.44/cwt. Feeder Cattle futures were supported by weaker corn prices.

Lean Hog futures bounced higher today after 3 days of sharp losses. Traders remain uncertain if hog receipts will meet forecasts.  The Pork Cutout gave up the nice gain seen yesterday.

Corn Dec -4 422; Jly -6 446; Dec14 -7 460
Bean Jan -33 1280; Jly -31 1245; Nov -23 1153
Meal Dec -14 410;  Jly -11 384
Oil -50 4047
Wheat Dec unch 644; Jly -3 656
KC -5 698; MGE -3 697
Oats +3 343
Rice -7 1576

LC Dec +42 13340; Feb +27 13480; Jun -7 12897
FC Nov +12 16515; Jan +62 16582; Apr +30 16595
LH Dec +30 8590; Feb +47 9027; Jun +17 9865
Milk Nov -1 1882; Dec -12 1798

US$ -.2%
Dow +85 15962
SP +8 1798
NAS +13 3986
Tran +50 7211
VIX -.18 12.19

WTI +8 9384
Brent +22 10850
Gas -3 266
NG +5.5 366
HO +1 294
Eth unch 178

Gold +1 1287
Slvr unch 2073

2-yr +.01 0.31%
5-yr +.02 1.35%
10yr +.02 2.71%
30yr +.02 3.80%

FSA Advises Producers to Anticipate Payment Reductions Due to Mandated Sequester

WASHINGTON, Nov. 15, 2013 —USDA’s Farm Service Agency (FSA) is reminding farmers and ranchers who participate in FSA programs to plan accordingly in FY2014 for automatic spending reductions known as sequestration. The Budget Control Act of 2011 (BCA) mandates that federal agencies implement automatic, annual reductions to discretionary and mandatory spending limits. For mandatory programs, the sequestration rate for FY2014 is 7.2%. Accordingly, FSA is implementing sequestration for the following programs:

• Dairy Indemnity Payment Program;
• Marketing Assistance Loans;
• Loan Deficiency Payments;
• Sugar Loans;
• Noninsured Crop Disaster Assistance Program;
• Tobacco Transition Payment Program;
• 2013 Direct and Counter-Cyclical Payments;
• 2013 Average Crop Revenue Election Program;
• 2011 and 2012 Supplemental Revenue Assistance Program;
• Storage, handling; and
• Economic Adjustment Assistance for Upland Cotton.

Conservation Reserve Program payments are specifically exempt by statute from sequestration, thus these payments will not be reduced.

“These sequester percentages reflect current law estimates; however with the continuing budget uncertainty, Congress still may adjust the exact percentage reduction. Today’s announcement intends to help producers plan for the impact of sequestration cuts in FY2014,” said FSA Administrator Juan M. Garcia. “At this time, FSA is required to implement the sequester reductions. Due to the expiration of the Farm Bill on September 30, FSA does not have the flexibility to cover these payment reductions in the same manner as in FY13. FSA will provide notification as early as practicable on the specific payment reductions. ”

For information about FSA programs, visit your county USDA Service Center or go to www.fsa.usda.gov/.


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