DTN Early Word Grains
Not Even Gold is Glittering
May corn was 1 cent lower, May soybeans were 4 cents lower, and July Kansas City (HRW) wheat was fractionally lower.
CME Globex Recap:Markets in general were lower overnight into Thursday morning with the exception being Minneapolis spring wheat. There, Wednesday's strong rally against the rest of the complex carried over into the overnight session. Soybeans were the weak link, influenced by a sharp sell-off in both Dalian (China) soybeans and Malaysian palm oil. Energies and metals were both lower as the U.S. dollar index extended Wednesday's rally, while DJIA futures were under pressure again.
OUTSIDE MARKETS:The Dow Jones Industrial Average closed 42.18 points (0.2%) lower at 20,659.32. The NASDAQ Composite gained 22.41 points (0.4%) to 5,897.55 and the S&P 500 rallied 2.56 points (0.1%) to 2,361.13 Wednesday. DJIA futures were 19 points lower early Thursday morning. Asian markets closed mostly lower with Japan's Nikkei down 154.26 points (0.8%), Hong Kong's Hang Seng off 90.96 points (0.4%), and China's Shanghai Composite down 31.08 points (1.0%). European markets were mostly higher Thursday with London's FTSE 100 off 6.50 points (0.1%), Germany's DAX up 13.63 points (0.1%), and France's CAC 40 near unchanged. The euro was 0.0028 lower at 1.0738 while the U.S. dollar index gained 0.19 to 100.12. June 30-year T-Bonds were 2/32 higher at 151'09 while April gold lost $4.20 to $1,249.50. Crude oil dipped $0.17 to $49.34 while Brent crude slipped $0.33 to $52.09. Dalian soybean and Malaysian palm oil futures were both lower overnight.
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| BULL | BEAR | ||
| 1) | Both old and new-crop corn continue to show short-term uptrends on daily charts. | 1) | Noncommercial selling could continue to pressure the corn market. |
| 2) | Total marketing year shipments of soybeans should still be running ahead of USDA's projected pace following weekly export sales and shipments. | 2) | On the other hand, export demand for U.S. soybeans continues to see its seasonal slowdown. |
| 3) | New-crop July Chicago and Kansas City wheat contracts are also showing signs of short-term uptrends on daily charts. | 3) | Much of the U.S. winter wheat growing area is seeing rain this week. |
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MORE COMMODITY-SPECIFIC COMMENTSCORN Despite the small setback overnight into Thursday morning short-term uptrends on daily charts for both old-crop May and new-crop December corn remain in place. Support for both are at recent lows of $3.54 1/4 and $3.78 1/4 respectively. As for old-crop, Thursday's weekly Export Sales and Shipment report is expected to show total shipments still running well ahead of USDA's projected demand pace. Last Thursday's report had total shipments 65% ahead of the previous year for the same week, as compared to USDA's March estimate of a 17% marketing year-to-marketing year increase. Of course USDA's Quarterly Stocks report is drawing nearer, scheduled for release at 11 am (CT) Friday morning and expected to confirm record demand for not only Q2 but also the first-half of corn's 2016-2017 marketing year. New-crop December will likely be influenced by USDA's prospective plantings number, though attention will quickly turn back to weather as rain systems continue to move across the U.S. Midwest as March comes to a close.
SOYBEANS To paraphrase Mark Twain, the reports of minor (short-term) uptrends in soybeans are greatly exaggerated. Yes, both old-crop May and new-crop November soybean contracts were unable to sustain buying interest Wednesday, falling to new lows before downtrends were extended overnight into Thursday morning. Pressure in soybeans continues to come from both sides, commercial and noncommercial, with the former indicated by a strengthening carry in the May-to-July futures spread. Similar to corn, Friday's USDA Quarterly Stocks report is expected to show record large Q2 and first-half demand for U.S. soybeans. However, Thursday's weekly export sales and shipment numbers (for the week ending Thursday, March 23) are also expected to show demand is in its seasonal slowdown as global (mostly Chinese) attention turns to South America's newly harvested supplies. New-crop November soybeans remain tentative ahead of Friday's Prospective Plantings report, though traders are keeping a closer eye on weather forecasts for the U.S. Midwest as rain systems continue to develop.
WHEAT Winter wheat contracts were lower early Thursday morning, likely pressured by recent rains that have moved across the U.S. Southern Plains (HRW) and Midwest (SRW) growing areas. Despite the lower trade both new-crop July Chicago and Kansas City continue to show minor (short-term) uptrends on daily charts. Thursday's weekly export sales and shipment numbers aren't expected to be extraordinary, with marketing year totals for all wheat likely to still be running behind USDA's projected demand pace. Looking ahead to Friday's Quarterly Stocks report, demand through Q3 could also be slightly less than projected.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.20 | $0.01 | -$0.38 | May | $0.004 |
| Soybeans: | $8.93 | -$0.03 | -$0.76 | May | -$0.001 |
| SRW Wheat: | $3.84 | $0.01 | -$0.42 | May | $0.002 |
| HRW Wheat: | $3.33 | $0.00 | -$0.91 | May | $0.006 |
| HRS Wheat: | $5.03 | $0.08 | -$0.41 | May | -$0.002 |
Darin Newsom can be reached at darin.newsom@dtn.com
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