DTN Closing Grain Comments

General Comments:

March corn was down 3/4 cent and December 2019 corn was down 1/4 cent. January soybeans were up 4 1/4 cents and November 2019 soybeans were up 2 1/2 cents. March K.C. wheat closed up 3 3/4 cents, March Chicago wheat was up 5 1/4 cents, and March Minneapolis wheat was up 1 1/4 cents. The March U.S. dollar index is down 0.38 at 96.52. February gold is up $9.00 at $1,250.40 while March silver is up 11 cents and March copper is down $0.0130. The Dow Jones Industrial Average is down 406 points at 23,695. February crude oil is down $1.01 at $50.46. February heating oil is down $0.0112 while February RBOB gasoline is down $0.0177 and February natural gas is down 0.273.

Corn:

March corn ended down 3/4 cent at $3.84 Monday on low trading volume, staying confined to a narrow, sideways range in December while cash corn prices hold near their highest level in six months. Several news sources have mentioned China as a possible buyer of modest amounts of U.S. corn, but so far, USDA has made no such announcement. Trading was quiet Monday and probably will be until January with the holidays drawing close. Earlier Monday, USDA said 34.8 million bushels of corn were inspected for export last week, putting total corn inspections up 73% in 2018-19 from a year ago. That is a bullish start for corn exports that should moderate as the season goes on as total export commitments are up just 16% from a year ago. Meanwhile, south-central Brazil has been hot and dry lately and southern Brazil has chances for rain later this week. For now, the trend in cash corn remains up during this quieter time of year, helped by active exports and a reluctance of farmer selling at current prices. Noncommercials are turning more bullish in corn, now holding 171,710 net longs as of Dec. 11, the most since June. DTN's National Corn Index closed at $3.49 Friday, near its highest prices in six months and 36 cents below the March contract. In outside markets, the March U.S. dollar index is down 0.38 with the Federal Reserve expected to raise the federal funds rate for a fourth time this year on Wednesday and make comments about 2019.

Soybeans:

January soybeans closed up 4 1/4 cents at $9.04 3/4 Monday, keeping a narrow, sideways range in December, just below the July high of $9.32 3/4. There's still unconfirmed talk of many expecting more sales to China, but so far, the actual amounts have been low and no new sales were reported by USDA on Monday. USDA did say 35.8 million bushels of soybeans were inspected for export last week, keeping total inspections down 41% in 2018-19 from a year ago. Monday's weather map shows mostly clear skies and mild temperatures across the U.S., a good day for hauling grain for those so inclined. Late Monday morning, numerous sources on Twitter said the National Oilseed Processors Association estimated November's soybean crush just under 167 million bushels, 2% more than a year ago, but less than some had expected. In Brazil, soybean conditions turned hotter and drier last week in the south-central region, but this week's forecast has a chance for rain in southern Brazil that will be closely monitored. Fundamentally, the outlook for a billion bushels or more of U.S. ending soybean stocks is a bearish concern for 2018-19. The trend in cash soybeans, however, remains up, helped by modest basis improvement in the context of a high risk trade environment. Friday's CFTC data showed commercials still lightly net long 30,558 contracts, a vote of confidence for soybean prices. DTN's National Soybean Index closed at $8.13 Friday, down from its highest level in four months and $0.87 below the January contract.

Wheat:

March K.C. wheat closed up 3 3/4 cents at $5.22 Monday on light volume as will probably be seen all week. The U.S. dollar index backed down 0.38 from its highest prices in a year and a half, but still remains a bearish factor for wheat prices trying to compete with Europe, Ukraine and Russia for exports. Several news sources have mentioned Russia's ag minister is scheduled to meet with exporters on Friday and so many are wondering if some kind of export restriction will be discussed. At this point, USDA is expecting 36.5 mmt (1.34 bb) of wheat exports from Russia's 70.0 mmt (2.57 bb) crop. It is no surprise that this tends to be a quieter of time of year for trading in wheat, but prices are getting some support from heavy rains at harvest time in both Australia and Argentina. Friday's CFTC data showed noncommercials net long 13,476 contracts as of Dec. 11, a small position that should not have much impact on prices. For now, the trend in cash HRW wheat remains sideways, while the trends in cash SRW and HRS prices are up, helped by signs of increased demand. DTN's National HRW Index closed at $4.88 Friday, near a new one-month high and 30 cents below the March contract. DTN's National SRW Index closed at $4.99 Friday, near its three-month high.

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

Follow him on Twitter @ToddHultman1

(CZ)

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