DTN Closing Grain Comments

Wheat Prices Sneak Higher on Quiet Day

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

General Comments:

Corn was down 3/4 cent in the December contract and down 3/4 cent in the July. Soybeans were down 1 1/2 cents in the January contract and down 1 1/2 cents in the July. Wheat closed up 3 1/4 cents in the December Kansas City contract, up 4 3/4 cents in December Chicago, and up 7 cents in the December Minneapolis contract. The December U.S. dollar index is up 0.03 at 96.11. December gold is down $4.60 at $1,227.70 while December silver is down 13 cents and December copper is down $0.0235. The Dow Jones Industrial Average is up 93 points at 25,555. December crude oil is down $0.88 at $62.22. December heating oil is down $0.0123 while December RBOB gasoline is down $0.0008 and December natural gas is down 0.014.

Corn:

December corn ended down 3/4 cent at $3.73 1/4 Tuesday, another quiet day of trading while Americans go to the polls and row-crop producers work at finishing harvest. USDA said late Monday that 76% of the corn is in and the states in the western Plains that are lagging have a mostly dry forecast for the next seven days with colder temperatures on the way. Tuesday's exceptions to the forecast showed rain in Kansas and snow in North Dakota. USDA will release its next round of supply and demand estimates on Thursday and corn prices are expected to stay well supported with Dow Jones' analysts anticipating a slight reduction in U.S. ending corn stocks, from 1.813 billion to 1.781 billion bushels. A slightly larger reduction is even possible as corn exports are off to a good start in 2018-19. For now, the trend in corn remains up as we head toward a quieter time of year. DTN's National Corn Index closed at $3.37 Monday, well above its September low of $3.00 and 37 cents below the December contract. In outside markets, the U.S. dollar index is up 0.03 and most outside commodities are trading lower.

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Soybeans:

January soybeans closed down 1 1/2 cents at $8.84 1/4, also not showing much price movement or trading volume on Tuesday. According to USDA, 83% of soybeans were harvested as of Sunday and, while that is closer to the finish line, many states are still behind their usual pace for this time of year. The seven-day forecast looks more helpful to harvest with mostly dry and cold conditions expected for much of the Midwest. The southeastern U.S. however, continues to get more rain. Soybean prices are still holding much of last week's gain, but that may get tested on Thursday if USDA reduces its estimate of U.S. soybean exports and/or reduces the estimate of China's soybean imports, as USDA's attache in China did on Monday. With lots of unanswered questions about U.S. soybean demand and, in spite of a bearish start in Brazil, soybean prices continue to trade in a sideways range, well above their September low. DTN's National Soybean Index closed at $7.85 Monday, priced $1.01 below the January contract and still well above the September low of $7.12. There were 251 delivery intentions of November soybeans issued late Monday. Open November contracts totaled 4,647 as of early Monday.

Wheat:

December K.C. wheat ended up 3 1/4 cents at $5.08, helped likely by a mix of commercial and noncommercial buying as prices continue to show support after testing their lowest prices in nine months in late October. It also seems likely from USDA's Crop Progress report on Monday that not all the winter wheat growers wanted to plant this fall may get planted. Kansas, Oklahoma, and Texas are still behind their usual paces with 37% of Kansas' soybeans still in the field and colder temperatures on the way. Expectations for Thursday's WASDE report show a little higher estimate of U.S. ending wheat stocks and a little lower estimate of world ending-wheat stocks, but nothing that should rattle prices much. The risk is USDA could lower the U.S. export estimate or surprise us with an adjusted foreign crop estimate, but expectations for a major change are low. With trading in wheat getting quieter this time of year, the trends in all three wheats remain sideways. DTN's National HRW Index closed at $4.72 Monday, 33 cents below the December contract and holding above support at $4.50. Similarly, DTN's National SRW Index closed at $4.75 Monday.

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

Follow him on Twitter @ToddHultman1

(CZ)

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Todd Hultman