DTN Closing Grain Comments

General Comments:

Corn was down 2 cents in the July contract and down 3 cents in the December. Soybeans were down 20 cents in the July contract and down 18 3/4 cents in the November. Wheat closed up 7 cents in the July Chicago contract, up 4 3/4 cents in the July Kansas City, and down 3/4 cent in the July Minneapolis contract.

The June U.S. dollar index is down 0.27 at 93.36. August gold is down $0.10 at $1,301.30 while July silver is up 1 cent and July copper is up $0.0020. The Dow Jones Industrial Average is up 54 points at 25,200. July crude oil is up $0.98 at $65.71. July heating oil is up $0.0436, while July RBOB gasoline is up $0.0415 and July natural gas is up $0.040.

Corn:

July corn ended down another 2 cents Thursday at $3.76 1/4, closing at a new four-month low as prices remain under pressure from a good start for row crops here in the U.S. Scattered rains fell in the western Plains Thursday, from North Dakota to Oklahoma with more expected across the Midwest the next five days. The rain will be welcome as Thursday's U.S. Drought Monitor showed areas of increasing dryness in Iowa, Illinois, Indiana and South Dakota. Meanwhile, the seven-day forecast for Brazil remains mostly dry with moderate showers expected in Parana. Northern China is also a dry area of concern to be watched, but so far is having no bullish impact on prices. Early Thursday, USDA said last week showed 33.0 million bushels of corn export sales and 57.0 million bushels of shipments, a neutral combination that keeps corn close to USDA's estimated pace. Technically, the trends remain down for both, old-crop and new-crop corn and are adding stress to noncommercials caught heavily long. DTN's National Corn Index closed at $3.46 Wednesday, down sharply from its highest price in 23 months and 32 cents below the July contract. In outside markets, the June U.S. dollar index is down 0.27 after Europe reported real GDP increased 2.5% in the first quarter from a year ago, roughly as expected. Outside commodities were predominantly higher early, but are now mixed.

Soybeans:

July soybeans dropped 20 cents to $9.74 1/4 Thursday, breaking below its sideways trend and falling to its lowest close in over four months. As with corn, U.S. soybean crops are starting the new season in good condition, 75% good-to-excellent said USDA on Monday. Thursday's scattered showers in the western Plains are helpful and are expected to expand across the Midwest the next five days, bringing needed help to a Corn Belt that is lower on subsoil moisture this year. The other source of bearish pressure on soybeans is this year's lower demand, related to the U.S. trade dispute with China and Brazil's record harvest earlier in 2018. Early Thursday, USDA said last week's export sales totaled 6.1 million bushels and shipments were 19.0 million bushels, both bearish amounts that have total soybean shipments down 9% in 2017-18 from a year ago. Thursday's lower closes turned the trend lower for both old-crop and new-crop soybeans and it also saw the bullish inverse disappear from the Nov/Mar spread. DTN's National Soybean Index closed at $9.29 Wednesday, priced 66 cents below the July contract and near its lowest price in three months.

Wheat:

July Chicago wheat closed up 7 cents and July K.C. wheat was up 4 3/4 cents at $5.44 1/2, squeezing out a third day of gains with support coming from this week's concerns of drier weather around the Black Sea. Here in the U.S., drought in the southwestern Plains is well known and USDA will give another crop estimate for winter wheat in the next WASDE report on Tuesday, June 12. Thursday's U.S. Drought Monitor showed increased areas of dryness in Texas and South Dakota, some of which is supposed to be eased by this week's rains across the Midwest. Spring wheat crops should benefit the most with moderate showers expected in the northwestern Plains and western Canadian Prairie. The latest concerns of dry weather around the Black Sea gave the short side of the market reason for pause this week and helped winter wheat prices trade higher, but there is still plenty to learn about wheat production in 2018. Technically, the trends remain up for all three wheats, even though prices failed to sustain recent tests above resistance. DTN's National SRW index closed at $4.93 Wednesday, down from its highest price in ten months and 27 cents below the July contract. DTN's National HRW index closed at $5.10, down from its highest price in over two years.

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

Follow Todd Hultman on Twitter @ToddHultman1

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