DTN Closing Grain Comments

General Comments:

Corn closed down 7 3/4 cents in the September contract and down 5 cents in the December. Soybeans were down 17 3/4 cents in the September contract and down 13 1/2 cents in the November. Wheat closed down 4 3/4 cents in the December Chicago contract, down 5 1/2 cents in the December Kansas City, and up 1 1/2 cents in the December Minneapolis contract.

The September U.S. dollar index is up .57 at 96.11. December gold is down $11.10 at $1,316.00 while December silver is down $0.17 and December copper is down $0.0065. The Dow Jones Industrial Average is down 83 at 18,420. October crude oil is down $0.62 at $46.36. October heating oil is down $0.0171 while October RBOB gasoline is down $0.0253 and October natural gas is down $0.072.

Corn:

December corn fell to another new contract low Tuesday, the lowest spot close in nearly seven years as crop conditions in 2016 continue to rate among corn's best. Late Monday, USDA said 92% of corn had reached the dough stage, 60% was dented, 9% of the crop was considered mature, and 75% was rated good-to-excellent, the same as last week. DTN's Corn Crop Condition Index is at 180, which matches the score from 2014 and is also the highest since 1994. Meanwhile, corn demand is good with Brazil out of the way as a competitor, but it isn't 15 billion bushels so the anticipation of increased corn supplies this fall is weighing heavy on prices. December corn remains under bearish pressure with corn's seasonal tendency pointing to a low in early-October. DTN's National Corn Index closed at $2.81 Monday, priced 40 cents below the December contract and even with its lowest price in 22 months. In outside markets, the U.S. dollar index is up .57, keeping a firm tone while several news sources continue to speculate about another rate hike in September.

Soybeans:

November soybeans closed lower Tuesday, dragged down by commercial selling in soybean meal and probably also aided by noncommercials getting out of their long positions. Last week's breakdown in meal prices is a new bearish sign on the demand side of the ledger, which is taking support away from soybeans just as the 2016 crop is getting closer to harvest. Late Monday, USDA said that 94% of soybeans had reached the pod setting stage, 5% were dropping leaves, and 73% of the crop was rated good to excellent, up from 72% a week ago. DTN's Soybean Crop Condition Index is at 175, which is two points below the 2014 index, and the second highest score in over a decade. With crop conditions that good, it is hard to argue with USDA's record crop estimate of 4.06 billion bushels, while no significant weather threats have been seen since June. November soybeans remains under bearish pressure with support at the August low of $9.43 being challenged. DTN's National Soybean Index closed at $9.32 Monday, priced 32 cents below the November contract and near its lowest prices in four months.

Wheat:

December Chicago wheat closed lower for a seventh consecutive day, posting its lowest spot close in 10 years as commercials continue to pull back from this market. Late Monday, USDA said 81% of the spring wheat harvest was done and no serious hurdles are expected with DTN's seven-day forecast looking mostly dry for the northwestern Plains. The southwestern Plains are expecting moderate rain amounts, which will help planting conditions next month for those that choose to participate. With December Chicago wheat currently down 30% from USDA's estimated production cost (excluding land expense) for 2015, prices have the earned the distinction of now being the most unprofitable since at least 1980. That is a tough way to start a new planting season and more wheat acres are likely to be dropped in 2017, but December Chicago wheat remains under bearish pressure with no bullish argument in view. DTN's National SRW index closed at $3.38 Monday, priced 59 cents below the December contract and at its lowest price in nearly seven years. DTN's National HRW index closed at $2.84, at its lowest price in 11 years.

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

Follow Todd Hultman on Twitter @ToddHultman1

(BAS)

Copyright 2016 DTN/The Progressive Farmer. All rights reserved.