DTN Closing Grain Comments

Headline K.C. Wheat Turns Lower, Rain on the Way

Todd Hultman , DTN Grains Analyst
(DTN illustration by Nick Scalise)

General Comments:

Corn was down 4 cents in the May contract and down 3 1/2 cents in the December. Soybeans were down 1/2 cent in the May contract and unchanged in the November. Wheat closed down 6 cents in the May Chicago contract, down 8 1/4 cents in the May Kansas City, and down 3/4 cent in the May Minneapolis contract.

The June U.S. dollar index is up 0.10 at 100.22. April gold is up $3.50 at $1,233.70 while May silver is up 2 cents and May copper is down $0.0285. The Dow Jones Industrial Average is down 6 at 20,909. May crude oil is down 0.25 at $49.06. May heating oil is up $0.0156 while May RBOB gasoline is up $0.0198 and May natural gas is up $0.080.

Corn:

May corn closed down 4 cents Monday, failing in its earlier attempt to trade higher after Friday's CFTC data showed noncommercials sharply cut back their net longs in corn, from 198,890 to 112,805 as of March 14. The rapid liquidation should ease selling pressure in corn, but so far, Brazil's weather has been favorable for the second corn crop with pollination expected in April. Corn continues to do well as far as U.S. demand is concerned. Monday morning, USDA said 52.5 million bushels of corn were inspected for export last week, a bullish amount that has total inspections up 72% in 2016-17 from a year ago. USDA added 5.2 million bushels (132,000 metric tons) of U.S. corn were sold to South Korea for 2016-17. With spot FOB corn prices nearly 50 cents a bushel cheaper in the U.S. than in Brazil, export business should continue to flow to the U.S. Technically, May corn remains in a downtrend but is holding above support at the 2017 low of $3.57 1/2. DTN's National Corn Index closed at $3.27 Friday, priced 41 cents below the May contract and up from its lowest price in 10 weeks. In outside markets, the June U.S. dollar index is up 0.10 in quiet trading.

Soybeans:

May soybeans closed down a half-cent after trying to trade higher most the day with help from commercial buying in soybean oil. The main bearish concern remains Brazil's record soybean harvest, which should now be close to two-thirds finished. This week's weather offers some chance for rain, but no serious roadblock to finishing harvest is expected. While soybean prices remain in a downtrend, the rate of decline slowed last week, thanks to active demand here in the U.S. USDA said Monday morning that 29.0 million bushels of soybeans were inspected for export last week, a bullish amount that has total inspections up 12% in 2016-17 from a year ago. Friday's CFTC data showed noncommercial traders reduced their net longs in soybeans from 143,379 to 105,478 as of March 14, the fourth consecutive week positions have been trimmed back, but traders remain stubbornly bullish. DTN's National Soybean Index closed at $9.22 Friday, priced 78 cents below the May contract and near its lowest price in 2017.

Wheat:

May Chicago wheat closed down 6 cents Monday, turning back an early effort to trade higher after the southwestern Plains experienced hot temperatures and windy weather over the weekend. DTN's seven-day forecast however, expects milder temperatures and rain over much of the central U.S. this week, including the southwestern Plains. Monday morning, USDA said 22.9 million bushels of wheat were inspected for export last week, enough to keep total inspections up 28% in 2016-17 from a year ago, but not really making a dent in the large U.S. surplus. Friday's CFTC data showed noncommercials increased net shorts in Chicago wheat from 26,482 to 57,742 on March 14, going back to their bearish stance after turning neutral a few weeks ago. Technically, the trend in May Chicago wheat remains down, but a sideways trading range seems more likely this early in the new season. DTN's National SRW index closed at $3.93 Friday, priced 43 cents below the May contract and up from its lowest close in five weeks. DTN's National HRW index closed at $3.61 and up from its lowest price in five weeks.

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

Follow Todd Hultman on Twitter @ToddHultman1

(ES)