DTN Closing Grain Comments

General Comments:

Corn closed down 4 3/4 cents in the September contract and down 5 1/4 cents in the December. Soybeans were down 1 cent in the September contract and down 2 1/4 cents in the November. Wheat closed down 7 3/4 cents in the December Chicago contract, down 6 1/2 cents in the December Kansas City and down 8 3/4 cents in the December Minneapolis contract.

The September U.S. dollar index is down .01 at 94.51. December gold is up $0.60 at $1,344.00 while September silver is up $0.03 and September copper is down $0.0265. The Dow Jones Industrial Average is up 31 at 18,560. October crude oil is up $0.73 at $48.14. October heating oil is up $0.0149 while October RBOB gasoline is up $0.0183 and October natural gas is up $0.087.

Corn:

December corn closed a nickel lower Tuesday, pressured by another week of high crop ratings from USDA. Late Monday, USDA said that 85% of corn had reached the dough stage and 40% was dented. Seventy-five percent of corn was rated good to excellent, pushing DTN's Corn Condition Index up from 179 to 180, the highest score since 1994. This summer's weather has been good for crops and DTN's seven-day forecast expects more rain in the central Corn Belt with moderate amounts reaching as far east as Pennsylvania. Day one of the Pro Farmer Midwest Crop Tour estimated corn yields in Ohio at 149 bushels, similar to a year ago. In South Dakota, estimated yields were down 10% from a year ago at 148 bushels. Anecdotal reports on Tuesday are finding higher yield estimates in Nebraska and Indiana with no strong reason yet to doubt that a big harvest is coming this fall. December corn remains under bearish pressure with possible support at $3.22 1/2. DTN's National Corn Index closed at $3.03 Monday, priced 31 cents below the September contract and up from its lowest price in 22 months. In outside markets, the U.S. dollar index is down .01 with traders wondering what Federal Reserve Chairman Yellen will say on Friday morning. The U.S. Census Bureau said that new home sales in July were up 31% from a year ago, the highest monthly showing since October, 2007.

Soybeans:

November soybeans closed a couple cents lower Tuesday after USDA's Crop Progress report showed a slight increase in crop conditions. Late Monday, USDA said that 89% of soybeans were setting pods and 72% were rated good to excellent, bumping up DTN's Soybean Condition Index from 173 to 174. 174 is comparable to crop conditions in 2014 and both are the highest for soybeans since 1994 so expectations are high for this week's crop tour. The crop tour started Monday on the outer edges where the weather has been sketchier and it showed in the soybean pod counts. In Ohio, the estimated pod count of 1,056 was down 6% from a year ago while the estimated pod count of 971 in South Dakota was down 8% from a year ago. The highest counts are expected to be seen in Iowa, Illinois, and Minnesota later this week. In spite of expecting a record soybean crop in 2016, the fundamental outlook remains neutral thanks to a similar expectation for record demand in 2016-17. There was no soybean sale announcement on Tuesday for only the fourth time in twenty trading days. DTN's National Soybean Index closed at $9.85 Monday, priced 31 cents below the November contract.

Wheat:

December Chicago wheat led grains lower Tuesday as this year's spring wheat harvest makes good progress. Late Monday, USDA said that 65% of spring wheat was harvested, well ahead of the five-year average pace. DTN's seven-day forecast is mostly dry for the northwestern Plains so there appears to be no hurdle in the way. Early Tuesday, Statistics Canada estimated all wheat production at 30.49 million metric tons in 2016, up 10.5% from a year ago and .5 mmt higher than USDA's current estimate. Canada is one of six major producers expecting increased wheat production in 2016, which touches on the reason that prices remain depressed. If USDA is correct, 2016-17 will be the fourth consecutive season that the world's ending wheat stocks have increased and will finish with the highest global ending stocks-to-use ratio in 15 years. Needless to say, December Chicago wheat remains under bearish pressure. DTN's National SRW index closed at $3.82 Monday, priced 34 cents below the September contract and up from its lowest price in over six years. DTN's National HRW index closed at $3.23, still near its lowest price in over 10 years.

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

Follow Todd Hultman on Twitter @ToddHultman1

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