DTN Closing Grain Comments

General Comments:

Corn closed down 5 1/2 cents in the July contract and was down 5 1/2 cents in the December. Soybeans closed down 8 3/4 cents in the July and down 7 1/2 cents in the November. Wheat closed down 13 1/2 cents in the July Chicago, down 12 1/2 cents in the July Kansas City and down 13 1/2 cents in the July Minneapolis.

The June U.S. dollar index is up 0.34 at 90.03. June gold is down $9.70 at $1,339.10 while May silver is down 8 cents and May copper is up $0.0030. The Dow Jones Industrial Average is down 180 points at 24,484. June crude oil is up $0.13 at $68.46. June heating oil is up $0.0079 while June RBOB gasoline is up $0.0136 and June natural gas is up $0.070.

For the week:

July corn closed down 9 cents and December was down 8 1/4 cents. July soybeans were down 24 3/4 cents while the November was down 14 1/2 cents. July Chicago wheat was down 12 cents, July Kansas City wheat was down 13 cents, and July Minneapolis wheat was down 21 cents.

Corn:

July corn dropped 5 1/2 cents to $3.85 1/2 Friday and was down 9 cents on the week as this year's prospects for planting started to look more hopeful. High temperatures in the 50s and 60s across the Corn Belt on Friday are slowly shrinking areas of snow cover across the Northern Plains and are expected to nudge higher into Monday. Otherwise, there was not much corn news Friday, but on a related topic, The Guardian reported early Friday that twenty ships carrying 1.2 million tons of U.S. sorghum to China were diverted to unknown destinations after China announced its anti-dumping duties on Tuesday. As of Thursday evening, spot milo prices in Kansas were modestly lower this week, but prices were down 24 cents in Houston. Fundamentally, the outlook for corn prices remains neutral with all the uncertainty of a new growing season ahead. Technically, the trend remains sideways in May corn as prices retreat from their April high. The trend is still up in new-crop corn, but those prices are also falling back from their April highs. DTN's National Corn Index closed at $3.50 Thursday, down from its highest prices since June 2016 and priced 32 cents below the May contract. In outside markets, the June U.S. dollar index is up 0.34 with this week's decline in 10-year T-note prices suggesting the Federal Reserve will keep raising rates. Other commodities are mixed.

Soybeans:

July soybeans finished down 8 3/4 cents at $10.40 1/4 Friday and were down 24 3/4 cents on the week while demand for U.S. soybeans continues to falter. Thursday's news from USDA of a new marketing year low in soybean shipments last week did not help matters as the trade dispute with China is starting to take a more visible toll on U.S. soybean prices. With soybean shipments currently 13% lower than a year ago, there is room for USDA to increase its estimate of U.S. ending soybeans stocks by another 200 million bushels or more, depending on how the final four and a half months of this season goes. Aside from a trade solution with China, which does not seem likely anytime soon, weather will once again be the key for U.S. soybean prices in 2018. So far, the new season is likely to start with favorable soil moisture across most of the Midwest, so speculators could grow nervous about their long positions, having a difficult time finding an immediate reason to buy soybeans. Outside of the U.S., the combination of China's demand for Brazil's soybeans and Argentina's drought is bullish for soybean prices. Inside the U.S., the outlook for old-crop soybean prices is neutral-to-bearish without China's full participation. Technically, the trend is sideways in old-crop soybeans with concerns of failing momentum. In new-crop soybeans, the trend is up but currently stalled. DTN's National Soybean Index closed at $9.68 Thursday, down from its highest prices in over a year and priced 70 cents below the May contract.

Wheat:

July Chicago wheat fell 13 1/2 cents and July K.C. wheat was down 12 1/2 cents to $5.02 Friday, ending the week lower for both contracts. Winter wheat prices continue to find support from drought conditions in the southwestern U.S. Plains, but turned lower Friday with light to moderate showers expected in the region later Friday into early Sunday. The rain will not be drought-busting amounts, but may offer some marginal benefit and will help suppress wildfire activity, which has been significant this week. Two other bearish pressures on winter wheat prices are related as poor local demand for U.S. winter wheat is also a function of mostly favorable wheat conditions around the world so far. Fundamentally, the outlook for wheat prices remains limited by plentiful global supplies with the uncertainty of a new season ahead. Technically, the trends remain sideways for all three wheats with winter wheat prices trading at the lower end of their ranges. DTN's National SRW index closed at $4.47 Thursday, down from its highest prices in eight months and 30 cents below the May contract. DTN's HRW index closed at $4.56, down from its highest price in two years.

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

Follow Todd Hultman on Twitter @ToddHultman1

(CZ)

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