DTN Early Word Grains

6:00 a.m. CME Globex:

July corn was down 1 3/4 cents, July soybeans were down 7 1/2 cents, and July Kansas City (HRW) wheat was down 5 cents.

CME Globex Recap:

Commodities were mixed to lower and stock markets lower early Friday with tariffs and trade concerns expected to be discussed at Friday's G-7 meeting in Quebec. The U.S. dollar index is also higher with many expecting another rate hike from the Federal Reserve next week. Row crops continue to slide lower while crop conditions are mostly favorable in the U.S.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 95.02 points higher at 25,241.41, but the S&P 500 was down 1.98 points to 2,770.37, while the 10-year Treasury yield ended at 2.93% Thursday. Early Friday, DJIA futures were down 153 points. Asian markets were lower with Japan's Nikkei 225 down 128.76 points (-0.6%) and China's Shanghai Composite down 42.35 points (-1.4%). European markets were also lower with London's FTSE 100 down 60.40 points (-0.8%), Germany's DAX down 134.00 points (-1.0%), and France's CAC 40 down 13.96 points (-0.3%). The euro was down 0.0042 and the U.S. dollar index was up 0.25 to 93.69. June 30-year T-Bonds were up 14/32nds while August gold was up $0.80 to $1,303.80 and July crude oil was down $0.26 at $65.69. China's Dalian soybeans were lower and Malaysian palm oil futures were down 0.7% overnight.

	BULL		BEAR
1)	Brazil's second corn crop remains dry and dryness is a concern early in northern China.	1)	U.S. row crops are starting 2018 with favorable conditions and there is rain in the U.S. seven-day forecast.
2)	The ten-year seasonal high for soybeans averages around early July.	2)	Noncommercials are heavily net long in corn and soybeans as prices are falling.
3)	Winter wheat contracts got a bounce from fresh concerns of increasingly dry conditions in Ukraine and southern Russia.	3)	Spring wheat conditions are favorable early with rain expected in the northwestern Plains and western Canadian Prairies.

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MORE COMMODITY-SPECIFIC COMMENTS

CORN July corn is down 1 3/4 cents early Friday, continuing to make new four-month lows while rain is falling from South Dakota to northern Illinois. More rain is expected to benefit row crops around the Midwest the next five days and that is keeping bearish pressure on corn prices and noncommercials that found themselves heavily long in early June. Meanwhile, Brazil's second corn crop remains dry and USDA is likely to have a lower crop estimate for Brazil in Tuesday's WASDE report. Dow Jones reported corn crops in Northern China and Ukraine are also in need of rain, but prices have shown no bullish response to those situations yet. Friday's CFTC report will be watched to see how much noncommercial liquidation has taken place as of Tuesday. The trend in corn is currently down.

SOYBEANS July soybeans are down 7 1/2 cents early, now trading near their lowest prices of 2018 after Thursday's sell-off took prices to a new four-month low and turned the trend lower. As with corn, soybean crops are off to a good start in the U.S. in 2018 and there is a chance that USDA's estimate of soybean plantings on June 29 will show more acres than were expected in March. With China benefiting from Brazil's record soybean harvest earlier this year, U.S. soybean shipments are down 9% in 2017-18 from a year ago and Thursday's report that last week's sales totaled 6 million bushels added to bearish perceptions. Technically, Thursday's new lows did serious technical damage to the soybean charts, including the new-crop contracts where the Nov/Mar spread is no longer showing a bullish inverse.

WHEAT July K.C. wheat is down a nickel early Friday, back under pressure while traders continue to assess world wheat production early in 2018. Prices got a lift this week from concerns of increasingly dry weather in Ukraine and southern Russia, but even the bullish impact of that seems limited as K.C. wheat prices are still on track for a small loss this week. The seven-day forecast remains mostly dry for the southwestern Plains and USDA will post its next estimate of the winter wheat crop in Tuesday's WASDE report. Outside of the southwestern Plains, prospects for wheat production are looking better with rain expected in the northwestern Plains and western Canadian Prairie the next seven days. For now, the trend remains gradually up in July K.C. wheat with support at the May low of $5.02 1/2.

DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.44	-$0.02	-$0.32	Jul	$0.000
Soybeans:	$9.09	-$0.20	-$0.65	Jul	$0.004
SRW Wheat:	$5.00	$0.06	-$0.27	Jul	-$0.005
HRW Wheat:	$5.17	$0.07	-$0.28	Jul	$0.021
HRS Wheat:	$5.83	-$0.01	-$0.15	Jul	-$0.003

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

Toddcan be followed throughout the day on Twitter @ToddHultman1

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