DTN Before The Bell Grains

Morning CME Globex Update:

Although the fireworks continue in the outside markets, with unemployment reported at a 48-year low and interest rates still rising, the corn, soybean, and wheat markets remain relatively mild, showing a higher trend this week to reflect the challenging harvest weather both in the U.S. and western Canada.

Other Markets:

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

Corn:

The grain markets spent the overnight session in the quiet trading ranges that have been typical lately, but spillover volatility from the outside markets could occur Friday. The U.S. unemployment numbers for September showed fewer jobs added than expected and markets are bracing for volatility. Otherwise, the recent upward trend in corn prices has brought the December contract roughly 25 cents above its low from Sept. 18. Although federal workers will have a three-day weekend to mark Columbus Day (or Native American Day in South Dakota), the markets will be open and trading on Monday. The monthly supply and demand estimates from the USDA will be released next Thursday, Oct. 11. The DTN National Corn Index was $3.24 Thursday afternoon, showing national average basis steady at 44 cents under the December futures contract.

Soybeans:

Soybeans prices are lightly higher Friday morning. Ongoing harvest delays across the Midwestern Corn Belt may soon be more than merely an annoyance for farmers. Potentially crop-damaging rain and localized flooding is expected in parts of Iowa this weekend. Meanwhile, the outlook for the first round of the Brazilian presidential election on Sunday seems to favor the far-right candidate, whom traders interpret as being friendly to the country's businesses and economy, and their currency continues to climb this week. This is generally considered a bullish influence on global soybean prices. In the U.S. cash market for soybeans, the DTN National Soybean Index was $7.56 per bushel Thursday, or $1.03 under the November futures contract, showing historically weak average basis bids.

Wheat:

Wheat futures prices have mostly held on to the double-digit gains they've made so far this week. Alberta, Saskatchewan and Manitoba, where the 2018 spring wheat and canola harvests were already far behind their typical pace, received more snow this week. Gains in the Minneapolis spring wheat futures market may be reflecting some risk premium to account for lodged, wet wheat, which may eventually arrive into the Canadian supply this year with potential quality losses. DTN's collected SRW Index was $4.79 Thursday (showing the average U.S. basis bid steady at 39 cents under the December Chicago futures contract); the HRW Index was $4.84 (stronger at 38 cents under the December KC futures contract); and the Spring Wheat Index was $5.33 per bushel (stronger at 57 cents under the December Minneapolis contract).

Elaine Kub can be reached at elaine@masteringthegrainmarkets.com

FollowElaine on Twitter @elainekub

(KR)

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