DTN Closing Grain Comments

General Comments:

Corn was down 5 3/4 cents in the September contract and down 5 3/4 cents in the December. Soybeans were down 16 1/4 cents in the September contract and down 16 1/4 cents in the November. Wheat closed down 3 1/2 cents in the December Chicago contract, down 2 3/4 cents in the December Kansas City and down 4 1/4 cents in the December Minneapolis contract.

The September U.S. dollar index is up 0.46 at 95.51. December gold is down $9.20 at $1,194.10 while September silver is down 21 cents and September copper is down $0.0295. The Dow Jones Industrial Average is down 67 points at 25,666. October crude oil is down $0.08 at $67.78. October heating oil is up $0.0076 while October RBOB gasoline is down $0.0066 and October natural gas is up 0.012.

Corn:

December corn closed down 5 3/4 cents at $3.61, a fifth consecutive day lower as buyers are still difficult to find in the face of pleasant August weather and a big U.S. corn crop estimate. Eastern Kansas drew most of the rain on Thursday while the rest of the Corn Belt was mostly dry. DTN's seven-day forecast expects light to moderate rain amounts in the northeastern Corn Belt while the rest is mostly dry. Thursday's U.S. Drought Monitor showed moisture improvement in the Southern Plains, but not in southern Iowa where moderate-to-extreme drought conditions are expanding. The other noticeable change was in North Dakota where conditions are drier than a week ago. It still appears that crop conditions are more favorable than a year ago, and the lack of significant threat is keeping buyers idle in the face of what is likely to be a large fall harvest. On the demand side, old-crop corn shipments of 2.154 billion bushels (bb) have two weeks left to reach USDA's 2.400 bb estimate, but that does not look likely. New-crop corn sales however, already total 390 million bushels (mb), which is up 61% from last year's depressed start. For now, the trend in December corn remains sideways, struggling with bearish harvest expectations. DTN's National Corn Index closed at $3.21 Wednesday, holding above its low in 2018 and 32 cents below the September contract. In outside markets, the September U.S. dollar index is up 0.46 after the U.S. enacted another $16 billion of tariffs against Chinese goods.

Soybeans:

November soybeans closed a fourth day lower, ending down 16 1/4 cents at $8.54. Like corn, soybeans are having a difficult time enticing buyers when a record U.S. soybean crop is widely anticipated for this fall. Wednesday saw another day of mostly pleasant weather across the Midwest with no serious threats in the seven-day forecast. Earlier Thursday, the U.S. enacted another $16 billion of tariffs against Chinese goods, and as of the time of this writing, there was no news from the two days of trade talks with Chinese officials in Washington. If we can ignore the political uncertainty for a moment, the demand side for soybeans is not looking too bad, considering the U.S. is in the middle of a trade war with China. Early Thursday, USDA said the U.S. shipped 2.003 bb of soybeans in the first 50 weeks of 2017-18, 107 mb shy of USDA's 2.110 bb estimate with two weeks to go. Old-crop exports will likely fall short of USDA's goal, but 464 mb of new-crop soybean sales are a good start, up 27% from a year ago. With all the political uncertainty, November soybeans are still trending sideways in a potentially volatile market environment. DTN's National Soybean Index closed at $7.84 Wednesday, back near its lowest price in over nine years and priced 86 cents below the November contract.

Wheat:

December Chicago wheat closed down 3 1/2 cents at $5.41 3/4 Thursday, similar to drops also seen in K.C. and Minneapolis. In Europe, wheat prices are holding firmer than in the U.S. and December milling wheat was down one euro or a half-percent on the day. Eastern Kansas received moderate-to-heavy rain Thursday at the same time the latest U.S. Drought Monitor was showing improved moisture levels in the U.S. Southern Plains from recent rains. Drought will continue to be a threat in the region as planting nears, but it is not causing much concern at the moment. New estimates from the International Grains Council reduced the estimate of world wheat production from 721 million metric tons (mmt) to 716 mmt (26.3 bb) on Thursday, now 5.5% less than a year ago. The new season's lower supplies should help U.S. wheat exports, but not just yet. USDA said last week's export sales and shipments of wheat totaled 8.8 mb and 16.9 mb respectively, another bearish week that has total wheat shipments down 34% in 2018-19 from a year ago. Keep in mind last year's 901 mb of exports were nothing to brag about. The recent enthusiasm for buying wheat has dissipated and all three wheats are now in sideways trends. DTN's National SRW index closed at $4.97 Wednesday, 29 cents below the September contract and down from its high in 2018. DTN's National HRW index closed at $5.11 Wednesday, also down from its highest price in 2018.

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

Follow Todd Hultman on Twitter @ToddHultman1

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