DTN Closing Grain Comments

Chicago Wheat Steals Monday's Show

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

General Comments:

Corn was up 1 1/2 cents in the December contract and up 1 1/4 cents in the July. Soybeans were down 3 1/2 cents in the January contract and down 3 1/4 cents in the July. Wheat closed up 6 cents in the December Kansas City contract, up 17 3/4 cents in December Chicago, and up 9 1/4 cents in the December Minneapolis contract.

The December U.S. dollar index is up 0.65 at 97.55. December gold is down $6.20 at $1,202.40 while December silver is down 12 cents and December copper is down $0.0080. The Dow Jones Industrial Average is down 403 points at 25,586. December crude oil is up $0.02 at $60.21. December heating oil is down $0.0092 while December RBOB gasoline is up $0.0263 and December natural gas is up 0.036.

Corn:

December corn closed up 1 1/2 cents at $3.71 1/4, staying roughly sideways as corn harvest made more progress last week. Due to Veterans Day, USDA's weekly Grain Inspections and Crop Progress reports will be released on Tuesday, but judging from last week's weather, progress was likely made in the central and western Plains while conditions stayed wetter in the Eastern Corn Belt. The forecast is mostly dry the next seven days, except for the southeastern Corn Belt where conditions have been excessively wet and troublesome the past month. With little news to report on Monday, it continues to be a good sign that corn prices are holding up well after last week's big upward revision of China's corn stocks from USDA. For now, the trend in corn remains up as we head toward a quieter time of year, which will eventually become more interested in demand. DTN's National Corn Index closed at $3.34 Friday, well above its September low of $3.00 and priced 35 cents below the December contract. In outside markets, the U.S. dollar index is up 0.65, supported by the anticipation of a rate hike in December while commodities are mostly higher.

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Soybeans:

January soybeans closed down 3 1/2 cents at $8.83 1/4 Monday on light volume, a day of quiet trading with no USDA reports due until Tuesday. It will be interesting to see Tuesday afternoon what USDA says about how the soybean harvest is going because Kansas and Missouri got more snow and rain the past two days and the southeastern Midwest remains excessively wet. Late Friday, Dow Jones reported that 71% of soybeans were planted in Brazil and 9% were planted in Argentina. Heavy rains are expected in Argentina the next seven days, which will keep planting progress slow and raise the risk of flooding. The billion-dollar question for soybeans continues to be about whether the U.S. and China are ready to get together on trade as all eyes will be on the G-20 meeting in Buenos Aires on Nov. 30. With plenty of unanswered questions about U.S. soybean demand in 2018-19, soybean prices continue to trade in a sideways range, well above their September low. DTN's National Soybean Index closed at $7.91 Thursday, priced $0.96 below the January contract and still well above the September low of $7.12. There were 249 delivery intentions of November soybeans issued late Friday. There were 2,301 contracts still open as of early Monday with expiration set for early Wednesday, Nov. 14.

Wheat:

December K.C. wheat closed up 6 cents Monday on light volume, but more excitement was found in December Chicago wheat where prices rallied 17 3/4 cents to $5.19 3/4 -- even as the December U.S. dollar index was trading up 0.65 to its highest prices in 16 months. There was not an obvious reason for the jump in Chicago wheat prices, but we can say that soft red winter wheat exports are up 2% from a year ago, there is hope for increased exports in early 2019, and heavy rains in Argentina are presenting risks of flooding in wheat areas. Technically, it is interesting that December Chicago wheat is turning higher after testing weekly support near its lowest prices in nine months, roughly at $5.00. In the case of Kansas City wheat, more snow fell across Kansas, Missouri and the Southern Plains the past two days, adding to the double-challenge of harvesting soybeans and planting winter wheat. For now, all three wheat prices remain under pressure but are holding sideways as we head into what is typically a quieter time of year. DTN's National HRW index closed at $4.56 Friday, 31 cents below the December contract and holding above support at $4.50. Similarly, DTN's National SRW index closed at $4.71 Friday.

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

Follow him on Twitter @ToddHultman1

(CZ)

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Todd Hultman