DTN Closing Grain Comments

General Comments:

Corn closed down 5 1/4 cents in the March contract and down 4 3/4 cents in the December. Soybeans closed down 11 1/4 cents in the March and down 5 3/4 cents in the November. Wheat closed down 6 3/4 cents in the March Chicago, down 1 3/4 cents in the March Kansas City and down 4 cents in the March Minneapolis.

The March U.S. dollar index is up 0.44 at 100.87. April gold is down $2.60 at $1,239.00 while March silver is down $0.04 and March copper is down $0.0130. The Dow Jones Industrial Average is down 60 at 20,560. March crude oil is down $0.21 at $53.15. March heating oil is down $0.0028, March RBOB gasoline is down $0.0224, and March natural gas is down $0.016.

For the week:

March corn closed down 6 1/4 cents and December closed down 5 cents. March soybeans were down 26 1/2 cents while the November was down 11 3/4 cents. March Chicago wheat was down 8 cents, March Kansas City wheat was down 4 1/4 cents, and March Minneapolis wheat was down 26 1/4 cents.

Corn:

March corn closed down 5 1/4 cents Friday and was down 6 1/4 cents on the week after a brief flirt with a new seven-month high earlier this week. Except for one brief January weekend of too much rain in Argentina, corn's bullish influence has come all from the demand side of the market, enjoying the trifecta of higher exports, record ethanol production and expanding livestock numbers. On Friday morning, USDA added news that 7.6 million bushels (194,112 metric tons) of U.S. corn were sold to Japan, 2.4 million bushels (60,000 mt) of which were for 2016-17. This good season of demand should have farther to go while U.S. prices remain attractive, but there is always the potential bearish threat of South America's larger harvests coming to market this summer. In spite of this week's decline, March corn remains in an uptrend. DTN's National Corn Index closed at $3.37 Thursday, priced 37 cents below the March contract and down from its highest price in seven months. In outside markets, the March U.S. dollar index is up 0.44 after the Conference Board's U.S. index of leading economic indicators increased 0.6% in January, more than was expected.

Soybeans:

March soybeans closed down 11 1/4 cents Friday and were also down 26 1/2 cents on the week with a breakdown in palm oil prices adding a new bearish element to the soy complex. May palm oil dropped 2.4% overnight to its lowest close in 12 weeks and also triggered selling in soybean oil where the March contract finished down $0.63 at its lowest close in nearly five months. On the other hand, March soybean meal was only down $2.50 on the week and remains a bullish influence on soybean prices with new-crop meal still near its contract high. The biggest bearish threat is Brazil's current soybean harvest, which appears to be going well. On Friday, private consultant Safras & Mercado said the soybean harvest is 52% complete in Mato Grosso, Brazil's largest producing province. Soybean prices continue to contend with plenty of bearish risks in 2017, but so far, March soybeans are holding above support at $10.17. DTN's National Soybean Index closed at $9.69 Thursday, priced 74 cents below the March contract and down from its highest price in six months.

Wheat:

March Chicago wheat closed down 6 3/4 cents Friday and was down 8 cents on the week, but prices are still near their highest level in five months and enjoying a well-deserved correction from the lows of 2016. Friday's 70-degree temperatures spread as far north as Nebraska and Iowa, which sound great for most of us but could be a problem for winter wheat later with plenty of freezing risk left in the season. The main benefit for winter wheat prices in 2017 has come as a significant rebound in the demand for cash wheat, but this is probably a good time to remember just how bearish the fundamentals are. With USDA expecting domestic ending wheat stocks of 1.14 billion bushels in 2016-17 or nearly half of last year's production, it remains difficult to convince noncommercial traders to buy wheat. Technically, the uptrend in March Chicago wheat continues for now. DTN's National SRW index closed at $4.10 Thursday, priced 37 cents below the March contract and down from its highest price in seven months. DTN's National HRW index closed at $3.67 and down from its highest price in seven months. Due to Presidents Day, U.S. grain futures will trade next at 7 p.m. CST on Monday, Feb. 20.

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

Follow Todd Hultman on Twitter @ToddHultman1

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