DTN Before The Bell Grain Comments

Morning CME Globex Update:

May corn was up 2 1/2 cents, May soybeans were up 3 1/2 cents, and May Chicago wheat was up 2 3/4 cents. One day after the U.S. dollar index fell to its lowest close in four months, corn, soybeans, and wheat were all starting modestly higher. Rain is moving into the southwestern Plains with a chance of severe weather later Tuesday.

Other Markets:

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

Corn:

May corn was up 2 1/2 cents, supported by early commercial bargain hunting after prices dipped to their lowest levels in 2017. This week's rain across the southern Plains will help recharge dry areas and is expected to reach as far north as Iowa and Illinois. In Brazil, light to moderate showers are expected to benefit the second corn crop in Mato Grosso this week while southern Brazil is drier. With conditions in Brazil looking good so far, Brazil's corn prices are dropping to new lows and becoming competitive with U.S. prices for the first time since June 2016. Friday's quarterly stocks report will likely show record corn demand in the first half of 2016-17, but the anticipation of Brazil's record corn crop is the bearish concern of the moment. May corn continues to trend gradually lower and is ripe for Tuesday's support. DTN's National Corn Index closed at $3.17 Monday, priced 39 cents below the May contract and at its lowest price in 2017. In outside markets, the June U.S. dollar index is up 0.03 and May crude oil is up 60 cents.

Soybeans:

May soybeans were up 3 1/2 cents early, offering a hint of support after four consecutive lower closes. The main source of bearish pressure continues to be Brazil's record harvest, now over 70% complete and facing another week of favorable weather for both harvest and ship loading. Related to Brazil's success, export business in the U.S. continues to slow, but it remains curious that while soybean prices in Brazil and in the U.S. continue to slide to new lows, they remain competitively close to each other. Friday's quarterly grain stocks report will likely show record demand for U.S. soybeans in the first half of 2016-17, but there are still concerns about how demand will fare in the second half of the season. May soybeans remains in a downtrend. DTN's National Soybean Index closed at $8.95 Monday, priced 76 cents below the May contract and at its lowest price in five months.

Wheat:

May Chicago wheat was up 2 3/4 cents early, also trying to make a show of support near its lowest prices in 2017. It is well-known that the central and southern Plains are expecting moderate to heavy showers the next three days and that should help this year's winter wheat crop conditions where the weather is not too severe. Monday's crop ratings from state NASS offices showed poor-to-very-poor ratings in Kansas, Oklahoma, and Texas at 25%, 19%, and 23% respectively -- all higher than a year ago. Outside of the U.S., there are no significant problems reported, but it is still early in the new season. May Chicago wheat remains in a downtrend, but like corn, could be ripe for support. DTN's National SRW index closed at $3.79 Monday, priced 42 cents below the May contract and near its lowest in seven weeks.

Todd Hultmancan be reached at todd.hultman@dtn.com

FollowTodd on Twitter @ToddHultman1

(BAS)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.