DTN Closing Grain Comments

General Comments:

Corn was down 2 1/2 cents in the May contract and down 2 3/4 cents in the December. Soybeans were down 14 1/2 cents in the May contract and down 10 1/2 cents in the November. Wheat closed down 4 1/4 cents in the May Chicago contract, down 7 cents in the May Kansas City, and down 8 1/2 cents in the May Minneapolis contract. The March U.S. dollar index is up 0.42 at 102.20. April gold is down $16.80 at $1,233.20 while May silver is down 68 cents and May copper is down $0.0490. The Dow Jones Industrial Average is down 58 at 21,058. April crude oil is down $1.22 at $52.61. April heating oil is down $0.0414 while April RBOB gasoline is down $0.0342 and April natural gas is up $0.005.

Corn:

May corn closed down 2 1/2 cents Thursday, easing back from this week's surprise rally while the market still wonders whether there will be expanded E15 sales this year or not. Granted, that is not a strong bullish factor in the short-run, but it has created enough curiosity to keep prices higher on the week and well above their recent lows. Early Thursday, USDA said last week's export sales and shipments of corn totaled 27.3 million and 59.0 million bushels respectively, a bullish combination that was tempered by the lower sales figure. So far in 2016-17, corn shipments are up 68% from a year ago, and the active pace should continue with U.S. corn prices 40 cents below their Brazilian counterparts. March corn did show 118 delivery notices Thursday, but there were still 15,988 contracts open earlier in the day. May corn remains in an uptrend, thanks to good demand. DTN's National Corn Index closed at $3.40 Wednesday, priced 42 cents below the May contract and down from its highest price in seven months. In outside markets, the March U.S. dollar index is up 0.42 with the Federal Reserve's next meeting less than two weeks away and more talk of a possible rate hike.

Soybeans:

May soybeans closed down 14 1/2 cents Thursday, having a tug of war with Tuesday's potentially bullish biodiesel tax credit rumor (see Thursday's DTN article, "Renewable Rumors Plus Time") on one side and the anticipation of a record soybean harvest in Brazil on the other. In spite of lots of news coverage about soybean trucks bogged down in northern Brazil's muddy roads, Thursday's trade showed more concern about the quantity of soybeans on the way with the latest estimates around 107 million metric tons to 108 mmt. Early Thursday, USDA said last week's export sales and shipments of soybeans totaled 15.7 million and 36.3 million bushels respectively, still above USDA's estimated pace, but also coming down each week as is usual for this time of year. So far, May soybeans have been able to keep the trend sideways, but there is still plenty of bearish risk. DTN's National Soybean Index closed at $9.70 Wednesday, priced 82 cents below the May contract and near its six-week low. Among March contracts, there were 594 delivery notices for soybean oil, 253 for soybean meal, and 561 for soybeans early Thursday.

Wheat:

May Chicago wheat closed down 4 1/4 cents, taking back part of Wednesday's gain, but still trading almost a nickel higher on the week while the forecast remains mostly dry for the southwestern Plains. The U.N.'s Food and Agriculture Organization estimated world wheat production at 744.5 mmt for 2017, basically the same as 2016 with current problems cited in only two countries -- Central Africa Republic (conflict) and Sri Lanka (drought). Of course, it is too early to get serious about crop estimates in 2017, but that is probably a good starting point with fewer acres expected in North America this year. Technically, May Chicago wheat remains in an uptrend, but the fundamental argument still leans heavily bearish. DTN's National SRW index closed at $4.10 Wednesday, priced 47 cents below the May contract and down from its highest price in seven months. DTN's National HRW index closed at $3.78 and down from its highest price in seven months. In the March contracts, there were 790 deliveries of Chicago wheat and 6 deliveries of K.C. wheat early Thursday. There have not been any March Minneapolis contracts delivered yet, but there were only 475 open early Thursday.

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

Follow Todd Hultman on Twitter @ToddHultman1

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