DTN Closing Grain Comments

Grains Quietly Mixed Ahead Of G-20

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

General Comments:

March corn was unchanged and July corn was unchanged. January soybeans were down 3 1/4 cents and July soybeans were down 3 3/4 cents. March K.C. wheat closed up 1/4 cent, March Chicago wheat was down 3 3/4 cents, and March Minneapolis wheat was down 3 1/2 cents. The December U.S. dollar index is up 0.09 at 96.77. February gold is up $0.50 at $1,230.30 while March silver is down 6 cents and March copper is up $0.0865. The Dow Jones Industrial Average is down 55 points at 25,311. January crude oil is up $1.75 at $52.04. January heating oil is up $0.0178 while January RBOB gasoline is up $0.0583 and January natural gas is down 0.065.

Corn:

March corn ended unchanged at $3.73 1/4 Thursday, finding slight support from USDA's report of higher export sales. USDA said last week's corn export sales and shipments totaled 49.9 million and 41.5 million bushe, respectively, putting total shipments up 81% in 2018-19 from a year ago and total export commitments up 16% from a year ago, above USDA's estimate for a 1% gain. With Brazil's crop conditions looking favorable early, the U.S. will likely encounter more export competition later in 2019. But, for now, export demand for U.S. corn is doing well. Demand for corn for ethanol, on the other hand, remains a concern with ethanol prices near their lowest level on record and profit margins at ethanol plants suffering. More precipitation is expected to work across the central Midwest Friday and Saturday, interrupting travel, but not likely having much impact on the remaining rounds of harvest. For now, the trend in corn remains sideways during this quieter time of year, helped by active exports. DTN's National Corn Index closed at $3.31 Wednesday, well above its September low of $3.00 and priced 42 cents below the March contract. In outside markets, the December U.S. dollar index is up 0.09, while outside commodities are mixed. January crude oil is up $1.75 with unconfirmed reports that Saudi Arabia and Russia are discussing production cuts.

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Soybeans:

January soybeans closed down 3 1/4 cents at $8.87 1/4 Thursday, a narrower trading range in front of Friday's G20 meeting after gaining over 28 cents the past two days. Trader attention remains on the upcoming meeting between the presidents of the U.S. and China and unconfirmed rumors were flying about a possible compromise in the works. But soybean prices themselves traded a narrower range Thursday. Here in the U.S. some are still working on harvest and it is likely a small percentage of this year's soybean crop will be lost to excessively wet weather at harvest time. Meanwhile, rain in the seven-day forecast continues to look favorable for Brazil's soybeans, while Argentina is making progress planting with lighter rain amounts in their forecast. For now, the trend in soybeans remains sideways and cash prices have been helped by modest basis improvement. Technically, January soybean prices remain confined to a symmetrical triangle pattern. DTN's National Soybean Index closed at $8.02 Wednesday, priced $0.88 below the January contract and still above the September low of $7.12.

Wheat:

March K.C. wheat ended up a quarter-cent at $4.92 1/2 in a quiet day of trading. Chicago wheat, on the other hand, fell 3 3/4 cents to $5.07 3/4, likely showing disappointment over USDA's small weekly export numbers. USDA said last week's export sales and shipments of wheat totaled 13.9 million and 9.2 million bushels, respectively; not much impact for a country expecting nearly a billion bushels of ending wheat stocks. One week away from the halfway mark in 2018-19, U.S. wheat shipments are down 18% from a year ago, but so far, USDA is staying with its estimate for a 14% gain on the season. Here in the U.S., the seven-day forecast is mostly dry for the southwestern U.S. Plains, but more, possibly heavy, precipitation is on the way to Arkansas and Missouri. As the Northern Hemisphere goes dormant, cash SRW wheat and spring wheat prices continue to trend sideways, while the trend in cash HRW wheat remains down. DTN's National HRW Index closed at $4.45 Wednesday, 47 cents below the March contract and below former support at $4.50. DTN's National SRW Index closed at $4.70 Wednesday and is still above its support.

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

Follow him on Twitter @ToddHultman1

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Todd Hultman