DTN Closing Grain Comments

General Comments:

Corn

was up 5 1/2 cents in the May contract and up 5 cents in the December. Soybeans were up 13 3/4 cents in the May contract and up 12 cents in the November. Wheat closed up 5 cents in the May Chicago contract, up 6 1/2 cents in the May Kansas City, and up 2 cents in the May Minneapolis contract.

The March U.S. dollar index is down 0.06 at 101.06. April gold is down $8.20 at $1,250.60 while May silver is down 1 cent and May copper is up $0.0190. The Dow Jones Industrial Average is down 26 points at 20,811 points. April crude oil is down $0.25 at $53.80. April heating oil is down $0.0180 while April RBOB gasoline is down $0.0239 and April natural gas is up $0.078.

CORN:

May corn closed up 5 1/2 cents Tuesday, largely supported by possible changes coming to the implementation of renewable fuels. See Tuesday's DTN article, "RFS Order Eyed" by Todd Neeley for further details, but President Trump is reportedly considering changing the point of obligation from refiners to terminals and may also lift a restriction which will allow more E15 to be sold in summer months. Tuesday's May corn price reached 18 cents higher at one point, but it seems unlikely that much rally was deserved, even if (and that is a big "if") the changes go through as suggested. Technically, Tuesday's rally did keep May corn in its gradual uptrend and above key support at the six-week low of $3.63. DTN's National Corn Index closed at $3.25 Monday, priced 44 cents below the May contract and down from its highest price in seven months. In outside markets, the March U.S. dollar index is down 0.06 ahead of President Donald Trump's address to a joint session of Congress Tuesday evening.

SOYBEANS:

May soybeans closed up 13 3/4 cents Tuesday with May soybean oil finishing up 1.30 cents a pound, the biggest percentage gainer among Tuesday's grain-related contracts. Even before the early morning pause in grains, it was odd that May soybean oil was leading grain contracts higher after the CME Group reported 1,059 deliveries of March soybean oil overnight, but those gains expanded after the 8:30 a.m. bell. This suggest that the soy rally was not just about muddy roads in Brazil. Later Tuesday morning, University of Illinois Ag Economist Scott Irwin shed light in a tweet that mentioned a rumor that President Trump was considering changing the biodiesel tax credit from a blender to a producer credit. If true (and at this point, the rumors are a long way from certain), a shift to a producer credit would favor U.S. biodiesel production and be legitimately bullish for U.S. soybean oil and soybean prices -- although it is difficult to say by how much. Tuesday's possible changes are new bullish factors to consider, but there are still all those new soybeans on the way from Brazil, even if the trucks are slow getting through the mud. Technically, May soybean prices are trading sideways to lower with no follow-through yet on last week's new low. DTN's National Soybean Index closed at $9.39 Monday, priced 83 cents below the May contract and near its six-week low. First notice day saw 1,059 delivery intentions for March soybean oil, 249 for March meal, and 500 for March soybeans.

WHEAT

May Chicago wheat closed up 5 cents Tuesday, influenced by the rally in corn and modest drop in the U.S. dollar, but also coming after state NASS offices reported lower crop ratings for winter wheat late Monday. Kansas, Oklahoma, and Texas reported good-to-excellent ratings of 43%, 43%, and 34% respectively with the Kansas rating down 16 percentage points from a year ago at this time. Of course, it is still too early in the season for traders to be concerned about weather, but worth noting that DTN's seven-day forecast remains mostly dry for the southwestern Plains with a return of warm weather this weekend. Technically, May Chicago wheat remains in an uptrend, but prices are likely to hold sideways in March until will know more about the next crop. DTN's National SRW index closed at $3.87 Monday, priced 52 cents below the May contract and down from its highest price in seven months. DTN's National HRW index closed at $3.54 and down from its highest price in seven months. Early Tuesday, CME Group announced 145 deliveries of March K.C. wheat and 958 of March Chicago wheat.

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

Follow Todd Hultman on Twitter @ToddHultman1

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