DTN Before The Bell Grain Comments

Morning CME Globex Update:

At 8 a.m. CST, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to unknown destinations for 2017-18. March soybeans were a little higher at the morning break while corn and winter wheat were a little lower, but all remain cautious ahead of Friday's WASDE, Grain Stocks, and Winter Wheat Seedings reports. USDA's weekly report of export sales continued to show shipments down from a year ago.

Other Markets:

Dow Jones:	Higher
U.S. Dollar Index:	Lower
Gold:	Higher
Crude Oil:	Higher

Corn:

March corn was down 1/4 cent early Thursday, staying quiet and slightly above its December low of $3.46 1/2 ahead of Friday's reports. It is odd that it has been a few weeks now since Brazil's FOB corn prices started rising, but we have yet to see any significant increase in U.S. corn export activity. Early Thursday, USDA said last week's export sales and shipments of corn totaled 17.2 and 35.0 million bushels respectively, another bearish combination for the week that put total shipments down 32% from a year ago. With exports dragging, demand is depending on feed and ethanol production and the concern is that Friday's corn stocks number could come in higher than the 12.4 billion bushels that are expected. For now, the trend in March corn is sideways and still under bearish pressure. DTN's National Corn Index closed at $3.16 Wednesday, priced 33 cents below the March contract and near its highest price in four months. In outside markets, the March U.S. dollar index is down 0.30 after the U.S. Labor Department said producer prices were down .1% in December, less than was expected.

Soybeans:

At 8 a.m. CST, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to unknown destinations for 2017-18. March soybeans were up 3/4 cent earlier Thursday, hovering near their lowest prices since August with several bearish factors working against them. First and foremost, Brazil's crops continue to do well with more rain expected in this week's forecast. Argentina has been drier, but is also expecting rain in the northern half later this week. Here in the U.S., export activity has been lower than expected and that did not change in Thursday's weekly figures. USDA said last week's export sales and shipments of soybeans totaled 22.3 and 56.8 million bushels respectively, still putting total soybean shipments down 14% from a year ago. As with corn, that low pace of soybean exports could have bearish ramifications in Friday's USDA reports. For now, the trend remains down in both, March soybeans and cash soybeans. DTN's National Soybean Index closed at $8.85 Wednesday, priced 70 cents below the March contract and near its lowest price in three months. Among January contracts, delivery intentions totaled 276 for soybeans, 27 for soybean meal, and 28 for soybean oil early Thursday. January grain futures contracts expire early Friday.

Wheat:

March Chicago wheat was down 2 3/4 cents early as traders show no concern about another shot of cold temperatures reaching into winter wheat country. Thursday morning saw temperatures in the teens in western Kansas that are expected to cover a wider area the next several days and will include southern Illinois. Thursday also has high wind warnings in western Kansas on top of already dry conditions. Early Thursday, USDA said last week's export sales and shipments of wheat totaled 2.6 and 10.6 million bushels respectively, another bearish week that has total shipments down 7% in 2017-18 from a year ago. Without more export business, U.S. wheat supplies continue to be a source of bearish pressure on prices as we may see again in Friday's USDA reports. The trend in winter wheat remains sideways with no bullish fundamental argument in view. DTN's National SRW index closed at $4.03 Wednesday, priced 32 cents below the March contract and near its highest price in three months.

Todd Hultman can be reached at todd.hultman@dtn.com

Follow Todd on Twitter @ToddHultman1

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