DTN Closing Grain Comments

General Comments:

May corn closed up 5 1/4 cents per bushel and December corn was up 4 cents. May soybeans closed up 11 1/4 cents and November soybeans were up 9 1/4 cents. May K.C. wheat closed up 4 1/2 cents, May Chicago wheat was up 5 cents and May Minneapolis wheat was down 1 3/4 cents.

The June U.S. dollar index is trading down 0.040 at 96.805. The Dow Jones Industrial Average is up 306.78 points at 26,235.46. June gold is down $4.80 at $1,293.70, May silver is down $0.03 at $15.09 and May copper is down $0.0085 at $2.9275. May crude oil is up $1.44 at $61.58, May heating oil is up $0.0202, May RBOB is up $0.0179 and May natural gas is up $0.044.

Corn:

Coming off of Friday's 17 1/2 cent drop after USDA estimated 92.8 million acres (ma) of corn plantings and reported a higher-than-expected 8.605 billion bushels (bb) of March 1 corn stocks, May corn found buyers for Monday's lower prices and finished up 5 1/4 cents at $3.61 3/4. The planting estimate, of course, is just an early guess and the real challenge of actual planting still lies ahead with concerns about excess moisture across the Midwest. The lower-than-expected corn demand of 7.995 bb for the first half of 2018-19 was still third best on record, helped by an early surge of export activity. On Monday, USDA said 49.6 million bushels (mb) of corn were inspected for export last week, a neutral amount that has total inspections up 21% from a year ago. In spite of Friday's bearish report numbers, the fundamental outlook for corn prices remains neutral. Technically, Friday's sell-off turned the trend of corn prices down, but further downside potential is apt to be limited. For now, May futures appear to have found support near the 2018 low and cash corn prices bounced up from a four-month low. DTN's National Corn Index closed at $3.30 Friday, priced 26 cents below the May contract and still near its highest price in nine months. In outside markets, most commodities other than metals are trading higher after an index of manufacturing for China showed slight expansion in February. The Dow Jones Industrials Average is also higher, trading up 307 points.

Soybeans:

May soybeans bounced up from a five-month low Monday, closing up 11 1/4 cents at $8.95 1/2. Unlike corn, USDA's estimate of March 1 soybean stocks was as expected Friday, and the planting estimate was less than expected, but difficult to believe at this point in the season. News from last week's trade talks was light over the weekend, but talks are going well enough to reconvene in Washington D.C. later this week. China continues to show a willingness to purchase moderate amounts of soybeans as talks progress. Early Monday, USDA said 30.4 mb (828,000 metric tons) of U.S. soybeans were sold to China for 2018-19, adding to Friday's sale of 30.0 mb sale to China. It may have also helped Monday's soybean prices to see the Shanghai Composite jump 2.6% to a new 10-month high after an index of manufacturing showed slight expansion for February. Earlier Monday, USDA said 26.9 mb of soybeans were inspected for export last week, another bearish showing that now has total inspections down 29% in 2018-19 from a year ago. Fundamentally speaking, soybean prices have plenty of bearish concerns with a record level of ending stocks expected in 2018-19. Trade talks with China however, remain uncertain and continue on a month-by-month basis. Technically speaking, May soybean futures are in the middle of a wide, sideways range that spans from $8.50 to $9.50. DTN's National Soybean Index closed at $7.98 Friday, a new three-month low and priced 87 cents below the May contract.

Wheat:

May K.C. wheat followed corn's lead and closed up 4 1/2 cents Monday at $4.34 1/2. Friday's 8 3/4 cent drop in K.C. wheat may have been unfair, given USDA did estimate a less-than-expected all wheat planting of 45.8 ma and less-than-expected 12.8 ma of spring wheat. We can't argue however, that 1.591 bb of March 1 wheat stocks is bullish, as it meant that three quarters of U.S. wheat demand totaled 1.532 bb, the lowest in at least 14 years. The lackluster demand continued Monday after USDA said 15.4 mb of wheat were inspected for export last week, putting the 2018-19 total down 6% from last year and below the pace needed to reach USDA's export estimate of 965 mb by the end of May. USDA's Crop Progress report of 2019 is expected to kick off Monday afternoon with crop ratings that look mostly favorable for winter wheat. The seven-day forecast expects rain in the U.S Southern Plains with lighter amounts on the western side. For now, the trends in cash HRW and SRW wheat remain down, while the trend in cash HRS wheat remains sideways. DTN's National HRW index closed at $4.16 Friday, 14 cents under the May contract and near its lowest prices in a year. DTN's National SRW index closed at $4.35, also near its lowest prices in a year.

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

Follow him on Twitter @ToddHultman

(CZ)

Copyright 2019 DTN/The Progressive Farmer. All rights reserved.