DTN Before The Bell Grain Comments

Morning CME Globex Update:

At 8 a.m. CST, USDA announced 4.7 million bushels (120,000 metric tons) of U.S. corn were sold to unknown destinations for 2016-17. Corn and soybeans were lower early Tuesday, pressured by a forecast that is mostly favorable for South America's corn crops and soybean harvest progress.

Other Markets:

Dow Jones:	Lower
U.S. Dollar Index:	Higher
Gold:	Lower
Crude Oil:	Higher

Corn:

At 8 a.m. CST, USDA announced 4.7 million bushels (120,000 mt) of U.S. corn were sold to unknown destinations for 2016-17. May corn was down 1 1/2 cents along with most other commodities after trading quietly overnight. Tuesday's weather should be less threatening in the Midwest after Monday's storms, but does show red flag warnings in the western Midwest. The best rain chances this week will be in the southeastern U.S. and southern tip of Brazil. Crop conditions for corn in South America are considered generally favorable and many are expecting a higher Brazilian crop estimate in Thursday's WASDE report from USDA. South America's crops present a bearish risk later this year, but so far, May corn continues to trend gradually higher with help from active demand for U.S. corn. There were five deliveries of March corn and 36 deliveries of March ethanol early Tuesday. DTN's National Corn Index closed at $3.37 Monday, 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 0.20 and most other commodities are lower, except for a 39-cent gain in April crude oil.

Soybeans:

May soybeans were down 4 3/4 cents early Tuesday with May soybean oil down 0.39 after palm oil futures were down 1.2% overnight. Soybeans are also displaying concerns of Brazil's advancing soybean harvest once again with help from this week's mostly dry weather in central Brazil, while moderate to heavy rain is confined to the southern end of the country. Thursday's WASDE report is not expected to show much change in USDA's estimate of U.S. ending soybean stocks, but the estimate of Brazil's soybean crop is expected to increase from February's estimate of 104.0 million metric tons. While Brazil's harvest continues to be the main bearish concern, May soybean prices are holding sideways so far, above support at last week's low of $10.17. DTN's National Soybean Index closed at $9.57 Monday, priced 80 cents below the May contract and near its six-week low. Among March contracts, there were 193 soybeans, 234 meal, and 297 bean oil delivered early Tuesday.

Wheat:

May Chicago wheat was down 2 1/4 cents, giving back part of Monday's gain early as prices continue to wrestle with plentiful wheat supplies on one hand and concerns about this year's early spring and dry conditions in the southwestern Plains on the other. Thursday's WASDE report is not expected to show much change or have much price impact while traders remain more concerned about the status of the new crop. DTN's seven-day forecast remains mostly dry for the southwestern Plains with mild temperatures. So far, May Chicago wheat remains in an uptrend, but sideways trading seems more likely in March until more is known about the next winter wheat crop. DTN's National SRW index closed at $4.12 Monday, priced 47 cents below the May contract and down from its highest price in seven months. Early Tuesday, there were 332 deliveries of March Chicago wheat.

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

Follow Todd Hultman on Twitter @ToddHultman1

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