DTN Closing Grain Comments

General Comments:

May corn closed down 2 1/2 cents per bushel and December corn was down 1 1/2 cents. May soybeans closed down 5 3/4 cents and November soybeans were down 5 cents. May Kansas City wheat closed down 6 cents, May Chicago wheat was down 1/4 cent and May Minneapolis wheat was down 6 cents.

The June U.S. dollar index is trading up 0.112 at 96.180. The Dow Jones Industrial Average is up 63.29 points at 25,580.12. April gold is down $6.10 at $1,316.50, May silver is down $0.13 at $15.44 and May copper is up $0.0080 at $2.8645. May crude oil is up $1.08 at $59.90, May heating oil is up $0.0080, May RBOB is up $0.0143 and May natural gas is down $0.018.

Corn:

May corn closed down 2 1/2 cents at $3.77 1/4 Tuesday, staying below its 100-day average on light volume with little happening until later this week. On Thursday afternoon, USDA's quarterly Hogs and Pigs report will be released, followed by March 1 Grain Stocks and Prospective Planting estimates at 11 a.m. CDT Friday. USDA's February corn planting estimate of 92.0 million acres (ma) is likely to be lower after recent flooding, but the flooding began in the middle of USDA's survey period, so it will be difficult to know how representative USDA's numbers will be of the new situation. Moderate rain is expected across the central Corn Belt the next seven days, while amounts will be lighter in the northern Corn Belt where flooding is a concern from snow melt. In South America, crop conditions remain favorable with a broad coverage of rain expected across Brazil. Fundamentally, the outlook for corn prices is neutral and the anticipation of big crops in South America is bearish. Technically, the trend in cash corn is up with support from commercial net-longs and plenty of uncertainty about the year ahead. DTN's National Corn Index closed at $3.52 Monday, priced 28 cents below the May contract and back at its highest price in nine months. In outside markets, the June U.S. dollar index is up 0.11, while other commodities are mixed to higher.

Soybeans:

May soybeans closed lower, dropping 5 3/4 cents to $9.00 3/4 Tuesday, staying at the lower end of its sideways range ahead of this week's trade talks and USDA's reports on Friday. USDA's February planting estimate of 85.0 ma may be adjusted higher on Friday due to difficulties planting corn this spring, but again, the risk of further flooding is high and remains an ongoing threat to spring planting plans. USDA's tally of March 1 soybeans is apt to look bearish as U.S. soybean exports are down 30% from a year ago at this point in 2018-19. Meanwhile, Brazil's soybean harvest is progressing at its usual pace, roughly two-thirds finished and already showing up in higher exports. Fundamentally, soybean prices have several bearish concerns, starting with the anticipation of record-high ending stocks in 2018-19. So far, bearish concerns are being restrained by the uncertainty of trade talks and the uncertainty of a new season ahead. Technically, both cash and soybean futures prices are holding sideways with commercial net-longs offering support. DTN's National Soybean Index closed at $8.19 Monday, priced 87 cents below the May contract and holding in a narrow, sideways range.

Wheat:

May K.C. wheat fell 6 cents Tuesday to $4.43 1/4, erasing Monday's gain. Tuesday's weather map is mostly dry across the U.S. with a chance for moderate rain across the central and eastern Midwest, affecting the SRW wheat region. The southwestern U.S. Plains are expected to stay mostly dry with the benefit of warm temperatures to finish the month. One unconfirmed source on Twitter reported a U.S. wheat sale to Egypt of 120,000 metric tons (mt) (4.4 million bushels), but even if true, it is not enough to lift the bearish weight of over a billion bushels of U.S. ending wheat stocks for 2018-19. Friday's USDA reports will not surprise anyone with a low planting estimate and March 1 wheat stocks will only be a surprise if they aren't bearish as demand has struggled this season. Fundamentally speaking, winter wheat prices may be near support, but it is difficult to be bullish while U.S. wheat supplies are plentiful and HRW wheat exports remain sluggish. Technically, the trends in cash HRW and SRW wheat remain down, while the trend in cash HRS wheat is challenging the upper end of its sideways range. DTN's National HRW index closed at $4.34 Monday, 15 cents under the May contract and up from its lowest prices in a year. DTN's National SRW index closed at $4.44, also up from its lowest prices in a year.

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

Follow him on Twitter @ToddHultman

(CZ)

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