DTN Closing Grain Comments

Soybeans End Lower in Quiet Session

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn was down 1 cent in the December contract and down 3/4 cent in the July. Soybeans were down 5 1/2 cents in the January contract and down 5 1/4 cents in the July. Wheat closed up 1 1/4 cents in the December Kansas City contract, up 2 cents in December Chicago, and down 1/4 cent in the December Minneapolis contract.

The December U.S. dollar index is up 0.23 at 96.36. December gold is down $7.50 at $1,234.40 while December silver is down 25 cents and December copper is down $0.0070. The Dow Jones Industrial Average is up 52 points at 24,740. December crude oil is down $0.37 at $67.22. December heating oil is down $0.0144 while December RBOB gasoline is up $0.0121 and December natural gas is down 0.032.

Corn:

December corn tried to trade higher Sunday evening, but fell back a penny to $3.66 3/4 by Monday's close, finding little interest in pushing prices higher while harvest progress is being made. The northern and eastern Midwest received light rains over the weekend while the rest of the Corn Belt had better harvest weather and are having nice weather again on Monday. Slicing diagonally, the northwestern Corn Belt has a drier forecast for the week ahead, but the southeastern half will see more unwelcome rain, especially in the Mississippi Delta and Ohio River Valley. Regarding demand, corn exports remain active with total export inspections up 69% from a year ago, but last week's 25.7 million bushel (mb) total was just a little above last year's number. Traders will be watching for USDA's latest report of harvest progress at 3 p.m. CDT. In the meantime, the trend in corn remains up as we head toward a quieter time of year. DTN's National Corn Index closed at $3.27 Friday, well above its September low of $3.00 and priced 41 cents below the December contract. In outside markets, the U.S. dollar index is up 0.23 while outside commodities are mixed, mostly lower.

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Soybeans:

January soybeans closed down 5 1/2 cents at $8.52 1/4 Monday, still plagued by concerns of demand for U.S. soybeans in 2018-19. It will be interesting to see USDA's estimate of soybean harvest progress at 3 p.m. CDT, but the market still won't have a good assessment on how many soybeans are making the grade and how many are being docked on price or refused. The drier seven-day forecast for much of the Western Corn Belt is proving helpful, but more heavy rains are expected this week from Arkansas to the Ohio River Valley. Meanwhile, the early season for soybeans in Brazil is off to a favorable start with more beneficial rains in this week's forecast and plantings expected to be at least 2% to 3% higher than a year ago. Brazil's real hit new five-month highs after Jair Bolsonaro was elected Brazil's new president on Sunday but was down 1.2% by Monday afternoon. Earlier Monday, USDA said 47.9 mb of soybeans were inspected for export last week, putting the total down 41% in 2018-19 from a year ago. USDA also said 4.4 mb (120,000 metric tons) of U.S. soybeans were sold to unknown destinations for 2018-19. The trend in soybeans is struggling to stay sideways and is still holding above its September low. DTN's National Soybean Index closed at $7.47 Friday, priced $0.98 below the November contract and still well above the September low of $7.12.

Wheat:

December Kansas City wheat ended up 1 1/4 cents Monday in a quiet day of trading, not finding much follow-through from Friday's surprising higher close. Late Friday, Dow Jones reported that Egypt rewarded the U.S. with the acceptance of a 60,000 mt cargo of wheat (2.2 mb) along with another 410,000 mt of other wheat that came mostly from Russia. The rare U.S. purchase, however, is due to how low U.S. prices have fallen as there is no sign of increased export activity in the U.S. USDA said Monday that last week's wheat inspections totaled 14.4 mb, just enough to put total inspections down 23% from a year ago and reinforce its bearish pace. Reaching new lows last week, the trends in both Chicago and K.C. wheat are currently down while the trend in Minneapolis wheat remains sideways. DTN's National HRW index closed at $4.65 Friday but likely fell to new lows on Thursday, trading 36 cents below the December contract. Similarly, DTN's National SRW index closed at $4.69 Friday.

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

Follow him on Twitter @ToddHultman1

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Todd Hultman