DTN Closing Grain Comments

General Comments:

Corn was up 2 1/4 cents in the March contract and up 1 1/4 cents in the December. Soybeans were up 16 cents in the March contract and up 8 3/4 cents in the November. Wheat closed up 1 3/4 cents in the March Chicago contract, up 2 1/2 cents in the March Kansas City and up 2 cents in the March Minneapolis contract.

The March U.S. dollar index is up 0.07 at 100.32. April gold is up $3.30 at $1,239.40 while March silver is down 2 cents and March copper is up $0.0325. The Dow Jones Industrial Average is down 33 at 20,057. March crude oil is up $0.18 at $52.35. March heating oil is up $0.0132 while March RBOB gasoline is up $0.0487 and March natural gas is up $0.016.

Corn:

March corn closed up 2 1/4 cents Wednesday, just a quarter-cent shy of its January high on the day before USDA's next WASDE report. December corn was up 1 1/4 cents, posting its highest close in seven months. Dow Jones' survey of analysts expects USDA to slightly reduce its estimate of U.S. ending corn stocks from 2.355 billion bushels to 2.342 bb on Thursday, but thanks to corn's increased export pace this season, there is room for the estimate to go lower. Ethanol demand has also been supportive for corn prices and the Energy Department said last week's ethanol production remained at a high pace of 1.055 million barrels a day, down from the previous week's record high of 1.061 million barrels a day. On Thursday, most attention will be paid to USDA's crop estimates for Brazil and Argentina, expected at 86.9 million bushels and 35.7 mb respectively. Unless there is some dramatic surprise, Thursday's report shouldn't have much price impact, allowing March corn to keep challenging and possibly surpass its January high at $3.71. DTN's National Corn Index closed at $3.32 Tuesday, priced 37 cents below the March contract and near its highest price in seven months. In outside markets, the March U.S. dollar index is relatively quiet, trading up 0.07. March crude oil is up 18 cents after the U.S. Energy Department reported a hefty 13.8 million barrel increase in last week's inventory.

Soybeans:

March soybeans closed up 16 cents Wednesday, helped by commercial buying that likely also included noncommercial traders and saw additional support from commercial buying in soy products. While there is a chance for moderate rain in northern Argentina this week, the last three sessions of higher soybean prices seems to be more about persistent demand, showing increased commercial buying in new-crop months. The motives are a bit confusing, but overall it seems that soybean demand is defying the odds once again in the face of Brazil's more obvious harvest -- a harvest that USDA is expected to estimate at a record high 104.1 million metric tons in Thursday's report and has a good chance of being even higher. Dow Jones' survey expects a U.S. ending soybean stocks estimate of 409 mb, but keep in mind that the demand side of the ledger remains largely unknown. So far, March soybeans continue to trend higher, supported by a series of higher lows since early August. DTN's National Soybean Index closed at $9.67 Tuesday, priced 76 cents below the March contract and down from its highest price in six months.

Wheat:

March Chicago wheat closed up 1 3/4 cents, helped by modest commercial buying one day before USDA releases its next round of monthly estimates. Dow Jones' survey of analysts expects USDA to tweak its estimate of U.S. ending wheat stocks from 1.186 mb to 1.178 million bushels and its estimate of world ending wheat stocks from 253.3 mmt to 253.5 mmt. Other than a possible increase in Australia's harvest, it is hard to imagine much of a shake-up in February's numbers. DTN's seven-day forecast remains mostly dry for the southwestern Plains with a chance of rain in Texas early next week. In spite of heavy domestic wheat supplies, March Chicago wheat continues to trend higher with resistance nearby at $4.38. DTN's National SRW index closed at $3.93 Tuesday, priced 38 cents below the March contract and down from its highest price in six months. DTN's National HRW index closed at $3.49 and down from its highest price in seven months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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