DTN Closing Grain Comments

General Comments:

Corn was up 1/4 cent in the July contract and up 3/4 in the December. Soybeans were up 26 3/4 cents in the July contract and up 25 1/2 cents in the November. Wheat closed down 11 cents in the July Chicago contract, down 12 1/4 cents in the July Kansas City, and down 7 1/4 cents in the July Minneapolis contract.

The June U.S. dollar index is up 0.08 at 93.62. June gold is down $0.80 at $1,290.50 while July silver is up 5 cents and July copper is up $0.0340. The Dow Jones Industrial Average is up 307 points at 25,022. July crude oil is up $0.96 at $72.33. July heating oil is up $0.0121 while July RBOB gasoline is up $0.0202 and July natural gas is down $0.023.

Corn:

July corn ended up a quarter-cent Monday at $4.02 3/4, helped by bullish influence from soybeans and another seven-day forecast of mostly dry weather for Brazil. Corn crops in southern Brazil did receive beneficial showers over the weekend, but more will be needed, and so far, the forecast is looking dry again. A smaller corn crop from Brazil will help U.S. exports and the pace is gradually improving. Here in the U.S., rain is falling around the Great Lakes, which should be mostly beneficial. Monday morning, USDA said 60.2 million bushels (mb) of corn were inspected for export last week, bringing total inspections to down 13% in 2017-18 from a year ago. Given May's more favorable planting weather, Monday afternoon's Crop Progress report is apt to show corn planting ahead of its five-year average. Friday's CFTC data showed noncommercials still bullish in corn with 394,310 net longs as of May 15. With fundamental support from crop concerns in Brazil, the trends remain up in both July corn and new-crop corn. DTN's National Corn Index closed at $3.68 Friday, still near its highest price in 23 months and priced 27 cents below the July contract. In outside markets, the June U.S. dollar is quiet, trading up 0.08 and near its highest prices in 2018. Outside commodities are mostly higher.

Soybeans:

July soybeans jumped up 26 3/4 cents to $10.25 1/4 Monday after U.S. Treasury Secretary Mnuchin told CNBC that both China and the U.S. have agreed to suspend tariffs while progress is being made on trade disputes -- bullish news for soybean traders' ears. Over the weekend, China and the U.S. issued a joint statement, which said China agreed to significantly improve the U.S. trade deficit, but details are still being negotiated. While the news lacked specific commitments, traders responded favorably and likely added to positions that were already bullish. Friday's CFTC data showed noncommercials holding 155,648 net-longs in soybeans as of May 15, down from 172,647 the previous week. Technically, the trend remains down in July soybeans and is still sideways in new-crop soybeans where futures spreads continue to show a bullish commercial outlook. DTN's National Soybean Index closed at $9.30 Friday, near its lowest in three months and priced 65 cents below the July contract.

Wheat:

July Chicago wheat closed down 11 cents and July Kansas City wheat was down 12 1/4 cents at $5.26 1/2, taking back part of Friday's gains while wheat reports around the globe remain mostly favorable. Europe and southern Russia are expecting beneficial rains this week while dry conditions in Australia remain a concern. Here in the U.S., the winter wheat crop has received some benefit from recent rains, but the forecast remains mostly dry for the U.S. southwestern Plains. After watching wheat prices climb higher through most of 2018, Friday's CFTC data showed noncommercials a little bullish in Chicago wheat with 22,644 net-longs as of May 15 -- a rare event that has not worked out well the past five times. Fundamentally, it remains difficult for the U.S. to compete with plentiful supplies of global wheat. Technically, the trends remain higher for the July contracts of both, Chicago and K.C. wheat. DTN's National SRW index closed at $4.87 Friday, down from its highest price in 10 months and 31 cents below the July contract. DTN's National HRW index closed at $4.99, near its highest price in over two years.

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

Follow him on Twitter: www.twitter.com/ToddHultman1

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