DTN Closing Grain Comments

General Comments:

Corn closed down 1 cent in the September contract and was down 1 cent in the December. Soybeans closed down 4 cents in the September and down 4 1/4 cents in the November. Wheat closed up 17 3/4 cents in the December Chicago, up 17 cents in the December Kansas City, and was up 12 cents in the December Minneapolis. The September U.S. dollar index is down 0.40 at 96.13. December gold is up $0.80 at $1,184.80 while September silver is down 4 cents and September copper is up 0.0345. The Dow Jones Industrial Average is up 120 points at 25,678. September crude oil is up $0.41 at $65.87. September heating oil is up $0.0049 while September RBOB gasoline is down $0.0050 and September natural gas is up $0.043.

For the week:

September corn closed up 6 1/2 cents and December was up 7 cents. September soybeans were up 30 3/4 cents while the November was up 31 cents. December Chicago wheat was up 10 1/4 cents, December Kansas City wheat was up 7 cents, and December Minneapolis wheat was down 3/4 cent.

Corn:

December corn ended down a penny at $3.78 3/4 Friday, but was up 6 1/2 cents on the week, partially recovering from last Friday's big loss related to USDA's larger-than-expected crop estimate of 14.59 billion bushels. With two billion bushels of old-crop corn carried into the new season, there will be plenty of corn available this fall and, going by the weather forecast, the crop could get bigger as it often does after the August report. The seven-day forecast expects moderate to heavy rain amounts for much of the central U.S. with the heavier amounts expected in the Eastern Corn Belt. September's weather is also expected to be favorable for crops and early harvest. It is on the demand side of the ledger where corn prices are apt to find support sometime during or after harvest as dry weather in South America put the U.S. in good position this year to benefit from more exports. For now, the trend in December corn remains sideways with the seasonal low typically seen around early October. DTN's National Corn Index closed at $3.34 Thursday, still above its low in 2018 and 31 cents below the September contract. In outside markets, the September U.S. dollar index is down 0.40, easing back from its highest prices in a year as traders anticipate the resumption of trade talks with China.

Soybeans:

November soybeans closed down 4 1/4 cents at $8.92 3/4 Friday, but were up 31 cents on the week, trimming back that big 42 1/4 cent loss from last Friday. The biggest boost to soybean prices this week came from Thursday's news that Chinese officials will be coming to Washington D.C., later this month in an effort to find a trade solution for the two countries. For soybeans in particular, it is fair to wonder if China will be willing to negotiate on the 25% soybean tariff, which presents a problem for Chinese importers this fall and upcoming winter. However, this is all speculation for now and was only enough to scare some shorts out of the market on Thursday. USDA's estimate of a record high 4.59 billion bushel U.S. soybean crop seems reasonable this year and rain in the seven-day forecast will be beneficial. What is not so well known is what demand will be in 2018-19 with the world's largest buyer of soybeans currently minimizing U.S. purchases. Currently, November soybeans remain in a sideways trading range, pressured by the anticipation of a big crop while trade policy remains a big question mark. DTN's National Soybean Index closed at $8.14 Wednesday, up from its lowest price in over nine years and priced 83 cents below the November contract -- the widest basis in over five years.

Wheat:

A little before 5 a.m. CDT, December Chicago wheat was quietly trading a few cents lower as it normally might, but a few minutes later, prices began to climb rapidly, following a surge of buying interest in Europe. Typically, U.S. markets don't trade that actively that early in the day, but Dow Jones later explained unconfirmed news that Russia's Ag Ministry may have mentioned curbing grain exports. Russia denies making such a statement so the status is unclear. Even so, the market's jumpy response shows how concerned traders are about the impacts of this year's dry weather. Here in the U.S., drought remains a concern in the Southern Plains for the next winter wheat crop, but the seven-day forecast does have rain on the way to help conditions before planting starts next month. December Minneapolis wheat closed up 12 cents Friday with the forecast still dry for the northwestern U.S. and western Canadian Prairie. With traders still showing concern about dry weather and this year's lower global production, the trends for all three U.S. wheats remain up. DTN's National SRW Index closed at $5.14 Thursday, 28 cents below the September contract and not far from its high in 2018. DTN's National HRW Index closed at $5.28 Thursday, also near its high in 2018.

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

Follow Todd Hultman on Twitter @ToddHultman1

(CZ)

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