DTN Closing Grain Comments

Grains Eke Out Small Gains

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

General Comments:

Corn closed up 1 1/4 cents in the May contract and up 3/4 cent in the December. Soybeans closed up 1/4 cent in the May and up 1/4 cent in the November. Wheat closed up 3/4 cent in the May Chicago, up 1 1/2 cents in the May Kansas City and down 5 1/4 cents in the May Minneapolis.

The March U.S. dollar index is down 0.55 at 101.65. April gold is down $2.00 at $1,230.90 while May silver is up $0.14 and May copper is up $0.0090. The Dow Jones Industrial Average is up 2 at 21,005. April crude oil is up $0.60 at $53.20. April heating oil is up $0.0076, April RBOB gasoline is up $0.0074, and April natural gas is up $0.009.

For the week:

May corn closed up 10 cents and December closed up 8 1/4 cents. May soybeans were up 13 1/4 cents while the November was up 15 cents. May Chicago wheat was up 5 1/2 cents, May Kansas City wheat was up 4 3/4 cents, and May Minneapolis wheat was down 6 cents.

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Corn:

May corn closed up 1 1/4 cents Friday and was up a dime on the week, thanks to the continuation of active demand and a new possibility of expanded sales of E15 ethanol -- if Tuesday's unconfirmed talk turns out to be true. U.S. corn exports are up 68% in 2016-17 from a year ago and, with spot FOB corn 40 cents cheaper in the U.S. than in Brazil, prices continue to favor more U.S. business. Also, Brazil's government said Thursday that their corn exports totaled 487,400 metric tons in February, down 91% from a year ago while the country restocks after last year's empty cupboards. Brazil's second corn crop holds a big promise to post record production in 2017, but there is still several months to go. In the meantime, demand for U.S. corn is keeping the May contract in a gradual uptrend. There were 118 deliveries of March corn notified early Friday. DTN's National Corn Index closed at $3.38 Thursday, priced 41 cents below the May contract and near its highest price in seven months. After posting a new seven-week high Thursday, the U.S. dollar index is down 0.55 with other commodities mixed and the next Federal Reserve decision due out on March 15.

Soybeans:

May soybeans closed up 1/4 cent Friday but held on to a gain of 13 1/4 cents for the week, thanks to bullish hopes that a U.S. producer-only biodiesel tax credit may be on the way. We are still a long way from knowing if or when that might happen, but Tuesday's rumor likely reinforced bullish opinion among noncommercial traders that were already 71% long on Feb. 21. On the bearish side of the coin, Brazil's government said Thursday that soybean exports were up 72% in February from a year ago, in spite of all the news photos of bogged down soybean trucks in northern Brazil. The private firm, Safras & Mercado, estimated Mato Grosso's soybean harvest at 78% complete Friday, continuing to make steady progress. U.S. soybeans exports are up 15% in 2016-17 from a year ago and spot FOB soybean prices are still competitive in the U.S., but this is the time of year when the export pendulum swings to Brazil. Soybean prices remain under bearish pressure, but are holding a sideways range, so far. Among March contracts, 568 contracts of soybeans, 253 meal, and 489 bean oil contracts were delivered early Friday. DTN's National Soybean Index closed at $9.57 Thursday, priced 80 cents below the May contract and in a sideways range.

Wheat:

May Chicago wheat closed up 3/4 cent Friday and was up 5 1/2 cents on the week with ongoing support from dry conditions and early warm temperatures in the southwestern Plains, putting crops well ahead of their usual growing season. DTN's forecast remains mostly dry and warm for the region the next ten days, but there is always a chance that another shot of freezing temperatures could return and catch crops vulnerable. Here in early-March, trader opinions are neutral with the what-if scenarios still wide open for the new season. Technically, May Chicago wheat remains in an uptrend, but a sideways range seems more likely until we know more about the 2017 crop. There were 518 contracts of March Chicago wheat and three March Kansas City wheat delivered early Friday. Trading is thin in March with a total of 1,703 contracts still open for all three wheats. DTN's National SRW index closed at $4.05 Thursday, priced 48 cents below the May contract and down from its highest price in eight months. DTN's National HRW index closed at $3.73 and down from its highest price in eight months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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Todd Hultman