DTN Early Word Grains

By Darin Newsom
DTN Senior Analyst

6:00 a.m. CME Globex:

March corn was 1 cent lower, March soybeans were 2 cents lower, and March Chicago wheat was 3 cents lower.

CME Globex Recap:

Grains were red again Wednesday morning, but as Tuesday showed, that doesn't necessarily lead to lower trade over the course of the day. Though off a couple cents, soybeans have posted a solid rally this week ahead of Thursday's USDA reports. Corn and wheat have struggled a bit more. The U.S. dollar index rallied overnight, but not enough to squelch buying interest in outside commodities with softs, metals, and energies all mostly higher. DJIA futures were also showing gains as early Wednesday morning as the Big Board continues to sit below 20,000.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 31.85 points (0.2%) lower at 19,855.53. The NASDAQ Composite gained 20.00 points (0.4%) to 5,551.82 and the S&P 500 was unchanged at 2,268.90 Tuesday. DJIA futures were 15 points higher early Wednesday morning. Asian markets were mostly higher with Japan's Nikkei up 63.23 points (0.3%), Hong Kong's Hang Seng gained 190.50 points (0.8%), and China's Shanghai Composite dropped 24.92 points (0.8%). European markets were also mostly higher Wednesday with London's FTSE 100 up 10.78 points (0.2%), Germany's DAX gaining 34.33 points (0.3%), and France's CAC 40 adding 8.24 points (0.2%). The U.S. dollar index was 0.27 higher at 102.31 while the euro was down 0.0030 at 1.0525. March 30-year T-Bonds were off 3/32 at 152'14 while February gold rallied $3.00 to $1,188.50. Crude oil gained $0.45 to $51.27 while Brent crude was $0.47 higher at $54.11. Dalian soybean and Malaysian palm oil futures were both higher overnight.

	BULL		BEAR
1)	Commercial buying continues to support the corn market.	1)	Corn futures have seemingly lost bullish momentum from earlier in the week.
2)	Soybean contracts are showing strengthening short-term uptrends on daily charts.	2)	Brazil's government increased its soybean production estimate Tuesday.
3)	Recently established uptrends in wheat remain in place.	3)	The stronger U.S. dollar index could put light pressure on wheat.

The weekly Newsom on the Market column can be found on subscription sites only. On DTN Pro it is in News/Town Hall and on MyDTN in News/Columns.

MORE COMMODITY-SPECIFIC COMMENTS

CORN Old-crop March corn has basically come to a standstill near the midpoint of its sideways range between $3.47 and $3.67. Overnight trade was quiet as the contracts posted a 1-cent range. New-crop December is showing much the same thing, also near the midpoint of its sideways pattern between $3.77 and $3.97. All this could change once USDA's January reports are released Thursday. As for Wednesday, look for another quiet session similar to what was seen Tuesday.

SOYBEANS Soybeans have posted solid gains this week with recently established minor (short-term) uptrends strengthening on daily charts. Much of the support has come from commercial buying tied to concerns over South American production, despite reports Tuesday Brazil's government (CONAB) upping its production estimate to 103.8 mmt. Heading into its January updates Thursday, USDA's estimate for Brazilian production sits at 102 mmt. Wednesday should see traders continue to monitor weather developments and forecasts for both Brazil and Argentina. Delivery of 151 contracts was reported against the January soybean contract, putting the total at 2,402 contracts. Another 208 contracts were reported delivered against Jan bean oil, putting its total to 4,927 contracts. Jan soybean meal reportedly had 195 contracts delivered, upping its total to 1,177 contracts.

WHEAT Winter wheat contracts were lower early Wednesday, most likely in reaction to the stronger U.S. dollar index. While trends for both Chicago and Kansas City remain up on weekly charts, both seem to have lost momentum since Monday's strong close. Some of this could be in anticipation of slightly bearish USDA numbers in Thursday's round of reports, with other selling tied to slowdown in export demand. It would not be surprising to see the complex remain under light pressure throughout Wednesday's session.

DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.23	-$0.02	-$0.35	Mar	-$0.002
Soybeans:	$9.42	$0.08	-$0.71	Mar	$0.000
SRW Wheat:	$3.86	$0.00	-$0.40	Mar	$0.004
HRW Wheat:	$3.43	-$0.01	-$0.95	Mar	-$0.012
HRS Wheat:	$5.27	$0.00	-$0.35	Mar	-$0.010

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

Darin can be followed throughout the day at www.twitter.com\DarinNewsom

(BAS)

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