DTN Closing Grain Comments

Soybeans Slide Lower Under Harvest Pressure

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
Connect with Todd:
(DTN illustration by Nick Scalise)

General Comments:

Corn closed down 2 1/4 cents in the March contract and down 1 3/4 cents in the December. Soybeans closed down 10 1/4 cents in the March and down 8 3/4 cents in the November. Wheat closed down 4 1/4 cents in the March Chicago, down 3 cents in the March Kansas City and down 2 3/4 cents in the March Minneapolis.

The March U.S. dollar index is up 0.06 at 99.85. April gold is down $2.20 at $1,217.20 while March silver is down $0.02 and March copper is down $0.0665. The Dow Jones Industrial Average is up 171 at 20,056. March crude oil is up $0.22 at $53.76. March heating oil is up $0.0055, March RBOB gasoline is up $0.0147, and March natural gas is down $0.119.

For the week:

March corn closed up 2 3/4 cents while December closed up 3 1/2 cents. March soybeans were down 22 1/4 cents while the November was down 15 1/2 cents. March Chicago wheat was up 9 3/4 cents, March Kansas City wheat was up 6 1/4 cents, and March Minneapolis wheat was down 1 3/4 cents.

P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]

Corn:

March corn closed down 2 1/4 cents Friday, but finished the week with a small gain, still finding the overall path of least resistance pointed higher. South America's forecast looks harmless for the next five days and Brazil's crops are doing especially well. Informa Economics said they are estimating Brazil's corn crop at 89.0 million metric tons and Argentina's at 35.2 mmt. That is a total of 1.2 mmt more than USDA's estimates, which will be updated in Thursday's WASDE report. The good news for U.S. corn is that there is still four or five months to take advantage of this season's increased demand before Brazil's corn exports begin. March corn is gradually trending higher and has a chance to take out the six-month high at $3.71. DTN's National Corn Index closed at $3.32 Thursday, priced 36 cents below the March contract and near its highest price in seven months. In outside markets, the March U.S. dollar index stayed fairly quiet, trading up 0.06 after the U.S. Labor Department said non-farm payrolls increased 227,000 in January, more than was expected.

Soybeans:

March soybeans closed down 10 1/4 cents Friday and was down 22 1/4 cents on the week with Brazil's harvest making steady progress. Not only are soybeans moving to port, but conditions have been good enough to bring out higher estimates as Informa estimated Brazil's soybean crop at 106.5 mmt Friday. On Thursday, USDA will release its next monthly WASDE report, and it is possible we will see a small increase in Brazil's soybean crop estimate, offset by a small reduction for Argentina. Overall however, it will be difficult for soybean prices to ignore the arrival of new supplies and widespread anticipation of increased U.S. plantings this spring. So far, March soybeans continue to trade near the middle of their two-month sideways range with support to watch at the January low of $9.93. DTN's National Soybean Index closed at $9.61 Thursday, priced 76 cents below the March contract and down from its highest price in six months.

Wheat:

March Chicago wheat closed down 4 1/4 cents on light volume, but was able to salvage a 9 3/4-cent gain for the week. This week likely saw more noncommercial short-covering, prompted by concerns of cold weather in southern Russia and news of renewed fighting in Ukraine, but the stronger factor behind wheat's higher prices continues to be the rebound in cash prices -- a combination of better demand and relief from the excess bearishness of 2016. Fundamentally, there is still no significant bullish argument for higher wheat prices, but technically, March Chicago wheat has turned higher and is close to taking out its three-month high at $4.38. DTN's National SRW index closed at $3.96 Thursday, priced 38 cents below the March contract and at its highest price in six months. DTN's National HRW Index closed at $3.51, near its highest price in seven months.

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

Follow Todd Hultman on Twitter @ToddHultman1

(BAS)

P[L2] D[728x90] M[320x50] OOP[F] ADUNIT[] T[]
P[R1] D[300x250] M[300x250] OOP[F] ADUNIT[] T[]
P[R2] D[300x250] M[320x50] OOP[F] ADUNIT[] T[]
DIM[1x3] LBL[] SEL[] IDX[] TMPL[standalone] T[]
P[R3] D[300x250] M[0x0] OOP[F] ADUNIT[] T[]

Todd Hultman