DTN Closing Grain Comments

General Comments:

July corn closed up 3/4 cent per bushel and December corn was down 1/4 cent. July soybeans closed down 6 3/4 cents and November soybeans were down 6 cents. July KC wheat closed down 3 cents, July Chicago wheat was down 6 1/2 cents and July Minneapolis wheat was down 1/2 cent. The June U.S. dollar index is trading down 0.356 at 97.225. The Dow Jones Industrial Average is up 12.33 points at 26,566.72. June gold is up $4.10 at $1,285.60, May silver is up $0.07 at $14.91 and July copper is up $0.0095 at $2.9065. June crude oil is up $0.26 at $63.76, June heating oil is up $0.0207, June RBOB is up $0.0328 and June natural gas is down $0.015.

Corn:

July corn traded lower most the day, but ended up 3/4 cent Tuesday, at $3.62 1/2 on light volume. Late Monday, USDA said 15% of the corn crop was planted, down from the five-year average of 27% for this time of year. There is nothing troublesome about the current pace of corn planting as the bulk of activity traditionally takes place during the next three weeks. What is legitimately troublesome, even while current prices don't reflect concern, is the prospects for planting the next two weeks are not favorable for the northern or eastern or southeastern Corn Belt. USDA pegged surplus topsoil moisture in Illinois, Indiana and Ohio at 53%, 66% and 74%, respectively. The seven-day forecast sees more rain on the way for most of the Corn Belt with the heaviest amounts due in and around Missouri, Illinois, Oklahoma and Arkansas. We will soon know if planting concerns are unfounded, but at this point, the risk of elevated prevented corn plantings in 2019 is high. Technically, July corn prices are near their lowest level in nearly ten months and the weekly stochastic is still bearish, but deserves close watching. Cash prices are currently firmer than futures contracts and it is slightly bullish that last Wednesday's new four-month low has shown no follow-through yet. DTN's National Corn Index closed at $3.32 Friday, 29 cents below the July contract and up from its lowest prices in four months. In outside markets, the June U.S. dollar index is down 0.36 after the Eurozone showed better-than-expected GDP growth in the first quarter, up 1.2% from a year ago. Outside commodities were almost all lower early Tuesday, but turned mixed to higher by early afternoon.

Soybeans:

Noncommercial selling continues in soybeans as the July contract lost another 6 3/4 cents Tuesday, ending at a new contract low of $8.54. From a bigger perspective, spot soybean futures are back near their lowest prices in 11 years as expectations for record ending soybean stocks inspire the current streak of short selling. We can't ignore that commercials have increased net longs as prices have dropped lower, but it hasn't been enough yet to stop the decline. U.S. officials are in Beijing this week and some are expressing hope that some kind of agreement could be reached next week, but traders have learned to tune out such talk. Late Monday, USDA said 3% of soybeans were planted as of April 28, slower than usual, but too early to be a threat. Louisiana, Mississippi and Arkansas were the only three states with double-digit progress. Fundamentally speaking, adverse weather or a trade agreement with China that includes large near-term purchases are the only bullish hopes at the moment. Technically, the speculative crowd continues to bet on lower prices, extending the trend lower. DTN's National Soybean Index closed at $7.75 Friday, 92 cents below the July contract and at its lowest price in five months.

Wheat:

July KC wheat fell another 3 1/2 cents to a new contract low of $3.94 Tuesday, continuing the bearish slide. This time, July Chicago wheat also fell to a new contract low, ending down 6 1/2 cents at $4.28 3/4. Monday's report from USDA did not help prices as it showed 64% of U.S. winter wheat crops rated good-to-excellent, up 2 percentage points from the previous week. Kansas wheat is doing well at 58% good-to-excellent as the 2019 Hard Red Winter Wheat Tour is finding out on its first day of touring. We look forward to an article from the tour Tuesday evening by DTN Staff Reporter Emily Unglesbee. Judging from her early tweets, fields are in good shape. The wheat tour won't go to the eastern Midwest, but if it did a different story would be told with high levels of surplus moisture and higher poor-to-very poor ratings for SRW wheat. USDA also said 13% of spring wheat was planted, down from the five-year average of 33%. Wet and cold conditions continue to hamper planting efforts in the Dakotas and Minnesota with more rain and snow on Tuesday's weather map for the area. U.S. spring wheat plantings probably won't reach USDA's estimate of 12.8 million acres, but an increase in Canada will make up for some of the loss. Both, winter and spring wheat prices continue to suffer under the weight of high domestic supplies and an early anticipation of a larger world crop in 2019. Technically, spot KC wheat is near its lowest prices in 13 years, a historically cheap level that is encountering no fundamental argument yet. DTN's National HRW Index closed at $3.88 Friday, its lowest in over a year and 19 cents below the July contract. DTN's National SRW Index closed at $4.14, trading not far above its March low.

Todd Hultmancan be reached at todd.hultman@dtn.com

FollowTodd on Twitter @ToddHultman1

(CZ)

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