DTN Before The Bell Grain Comments

Morning CME Globex Update:

July corn and all three wheats were higher early Tuesday, helped by a lack of rain in Brazil and a broadly higher start for nearly all commodities. July soybeans were also higher, adding to gains from Monday's news that tariff proposals were suspended.

Other Markets:

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

Corn:

July corn was up 3 cents early Tuesday with satellite maps showing virtually no rain in Brazil and not much in the Midwestern U.S., except for showers in eastern Nebraska. The seven-day forecast remains mostly dry for Brazil, an ongoing source of stress for the second corn crop. Late Monday, USDA said 81% of corn was planted and 50% was emerged as producers make up for this year's slow planting start. Illinois was 96% planted while progress remained slower across the northern states. Overall, the new U.S. corn crop is off to a good start with moisture concerns mainly limited to the western Plains. Technically, the trends remain up in both July corn and new-crop corn. DTN's National Corn Index closed at $3.69 Monday, still near its highest price in 23 months and priced 34 cents below the July contract. In outside markets, the June U.S. dollar index is down 0.11, while nearly all commodities are trading higher.

Soybeans:

July soybeans were up 6 cents early, adding to gains after Monday's news that China and the U.S. agreed to suspend tariff proposals as trade differences are being negotiated. Late Monday, USDA said 56% of soybeans were planted and 26% were emerged, both ahead of their five-year average paces. Rain in the latest seven-day forecast will likely add to planting delays in Minnesota, but overall, row crops are off to a good start in 2018. The main concern for old-crop soybean prices is a lack of demand for U.S. soybeans while China takes advantage of Brazil's record harvest. There is talk of a truck strike in Brazil, which is common for this time of year and is not likely to have much impact on soybean prices. Technically, the trend is down in July soybeans, but still sideways in new-crop soybeans where futures spreads continue to show a bullish commercial outlook. DTN's National Soybean Index closed at $9.57 Monday, up from its lowest prices in three months and priced 68 cents below the July contract.

Wheat:

July Chicago wheat was up 10 1/2 cents and July Kansas City wheat was up 11 3/4 cents early Tuesday with mainly light rain amounts expected in the southwestern Plains the next seven days. Late Monday, USDA said 61% of winter wheat was headed and 36% was rated good to excellent, the same as a week ago. DTN's Winter Wheat Condition Index gained one point to 58%, which is also the lowest crop rating in four years. USDA also said 79% of spring wheat was planted and 37% was emerged, bouncing back from this year's slow, cold start. The biggest planting delay is in Montana where 66% of the crop is in. Given this year's drought, it seems obvious that this year's winter wheat crop will be down and possibly lower than the 1.19 billion bushels USDA is estimating. The bigger concern' however, comes from wheat production outside of North America, and so far, most regions look favorable. Weather remains the key, but at this time, it is 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 $4.77 Friday, down from its highest price in 10 months and 31 cents below the July contract.

Todd Hultmancan be reached at todd.hultman@dtn.com

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

(KR)

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