DTN Early Word Grains

6:00 a.m. CME Globex:

March corn was up 3/4 cent, March soybeans were up 7 1/4 cents, and July Chicago wheat was up 1/2 cent.

CME Globex Recap:

Grains flipped higher overnight with help from a higher close in palm oil futures and are starting Tuesday in the opposition position of where they were 24 hours ago. The U.S. dollar index is also reacting higher after falling to a new six-week low Monday.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed down 27.40 points at 19,799.85. The NASDAQ Composite was down 2.39 points at 5,552.94 and the S&P 500 was down 6.11 points at 2,265.20 Monday. DJIA futures were up 1 point early Tuesday morning. Asian markets were mixed with Japan's Nikkei down 103.04 points (-.6%), Hong Kong's Hang Seng up 51.34 points (0.2%), and China's Shanghai Composite up 5.78 points (0.2%). European markets were higher Tuesday with London's FTSE 100 up 17.33 points (0.2%), Germany's DAX up 34.31 points (0.3%), and France's CAC 40 up 11.64 points (0.3%). The U.S. dollar index was up 0.41 at 100.34 while the euro was down 0.00180 at 1.07500. March 30-year T-Bonds were down a half-point at 151'16 while February gold was down $4.10 at $1,211.50. March crude oil was up $0.20 at $52.95 while Brent crude was up $0.14 at $55.37. Dalian soybean futures were steady to higher and Malaysian palm oil futures were up 1.9%.

	BULL		BEAR
1)	March corn is staying close to the new six-month high posted Friday.	1)	Record fall corn and soybean harvests started 2016-17 with plenty of supply.
2)	Argentina has suffered production loss from adverse weather, possibly as much as 5% to 10%.	2)	U.S. soybean exports remain above a year ago, but a possible trade conflict is brewing with China and Brazil's harvest has begun.
3)	The U.S. dollar index is staying down from the 14-year high made in December after President Trump said he supports a weaker dollar.	3)	U.S. wheat supplies remain burdensome and drought conditions are expected to ease the next three months.

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 March corn was up 3/4 cent early Tuesday, continuing to chip away at market bears with small, steady gains while the sell side of the market has little reason to fight back. The U.S. has plenty of corn stored away and even though prices are at their highest levels in six months, producers are not seeing much incentive to move grain. So far, South America's harvest is on track to be much larger this year, but Brazil's corn exports don't typically pick up until July so there is still time for this trend to keep working gradually higher.

SOYBEANS March soybeans were 7 1/4 cents higher early with commercial traders reacting back after Monday's 9 3/4-cent loss. Similarly, March soybean meal is up $2.20. March soybean oil is also helping Tuesday's higher start with a gain of 0.38 after March Malaysian palm oil futures were up 1.9% overnight, near their contract high. Crop conditions in Brazil remain generally favorable with more rain in this week's forecast and present the most bearish immediate threat to soybean prices. This week's forecast for Argentina is mostly dry which is helping central and northern crop areas avoid more flooding. So far, March soybeans remain in an uptrend with Brazil's next harvest presenting bearish risk to prices.

WHEAT March Chicago wheat was a half-cent higher early, tagging behind corn with little else happening to influence prices. DTN's seven-day forecast expects winter precipitation across the northern Midwest, but the southwestern Plains will remain mostly dry with mild to warm temperatures for January. Fundamentally, nothing has changed for wheat in the past month and supplies are as big as ever, but it is plain to see that the tone in wheat prices has changed as the old bearish reasons aren't holding prices down the way they were in late 2016. March Chicago wheat continues to trade near the higher end of its sideways range and has a chance to drift higher this season while production remains off-line.

DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.34	$0.00	-$0.36	Mar	$0.001
Soybeans:	$9.81	-$0.10	-$0.77	Mar	-$0.003
SRW Wheat:	$3.94	$0.06	-$0.39	Mar	$0.009
HRW Wheat:	$3.51	$0.02	-$0.94	Mar	$0.003
HRS Wheat:	$5.22	-$0.02	-$0.42	Mar	$0.019

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

Toddcan be followed throughout the day at www.twitter.com\ToddHultman1

(BAS)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.