DTN Closing Grain Comments

By Darin Newsom
DTN Analyst

General Comments:

March corn was up 1 1/2 cents at $3.49 3/4 with new-crop December 2017 1 cent higher at $3.79 1/4. March soybeans finished 3 3/4 cents lower at $10.12 3/4 with new-crop November 2017 down 2 1/2 cents at $9.93 1/2. March Chicago wheat closed 3 1/4 cents higher at $4.04 3/4, March Kansas City gained 5 3/4 cents to $4.15 1/4, and March Minneapolis rallied 4 3/4 cents to close at $5.35 1/2. The U.S. dollar index was 0.55 lower at 102.67. February gold was $15.20 higher at $1,156.10 while March silver was $0.142 higher and March copper dipped $0.0100. The Dow Jones Industrial Average was off 4 points to 19,829. February crude oil was down $0.32 at $53.47. The January distillates (heating oil) contract was $0.0057 higher, January RBOB gasoline added $0.0060, while February natural gas fell $0.100.

Corn:

The corn market spent most of the day in the green, or on the plus-side of unchanged, though trade volume was relatively light. Old-crop March showed less than 79,000 contracts changed hands as compared to Wednesday's volume of 122,291 contracts and Tuesday's 132,722 contracts. Given it's a short week in between two three-day holiday weekends, lower volume trade isn't a surprise. What is more of a surprise though is the March-to-May futures spread finally breaking through resistance at the 6 1/2-cent carry level on its weekly close only chart. If it can hold the 6 cents it was showing at Thursday's close, it would signal the move to an uptrend (weakening carry) that reflects a more bullish commercial outlook. Friday will see the delayed release of weekly export sales and shipment numbers.

Soybeans:

Where the March-to-May corn spread looks to be trending up (weakening carry, more bullish commercial outlook), the opposite is going on in the March-to-May soybean spread. Though unchanged Thursday at an 8 3/4-cent carry, the trend of the bean spread is down, reflecting a more bearish commercial view of supply and demand. For the record, the new-crop November 2017-to January 2018 spread is also in a downtrend. Friday's holiday delayed weekly export sales and shipment numbers are expected to be big relative to a year ago, though shouldn't create much of a buying buzz in the market. Soybeans toiled in the red, below Wednesday's close, for much of Thursday's session and could see more of the same light selling interest Friday.

Wheat:

Winter wheat greened up again Thursday. No, not the crop ahead of another winter blast next week, but the futures market. Contracts spent most of Thursday above unchanged on buying tied the lower U.S. dollar index and mumblings of Egypt possibly being interested in buying U.S. HRW wheat. It's interesting to note that the buying in Kansas City futures (HRW market) was mostly from noncommercial traders, as indicated by the slightly stronger carry in the old-crop March-to-May futures spread. This would suggest commercial traders didn't necessarily believe the Egypt rumors, or if they did already have enough HRW supplies on hand to fill immediate needs. Friday's holiday-delayed weekly export sales and shipment numbers are expected to be largely a non-event for wheat, with the exception being a continued strong marketing year pace for the hard red classes.

Darin Newsom can be reached at darin.newsom@dtn.com

Follow Darin Newsom on Twitter @DarinNewsom

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