DTN Before The Bell Grain Comments

Morning CME Globex Update:

May corn was down 1 cent, May soybeans were down 4 1/4 cents, and May Chicago wheat was down 1 cent. At 8 a.m. CDT, USDA announced 6.1 million bushels (165,000 mt) of U.S. soybeans were sold to China for 2017-18. Corn, soybeans, and wheat were modestly lower early, staying quiet ahead of Friday's USDA reports. May soybean oil was down 0.40 after spot palm oil fell to its lowest close in four months.

Other Markets:

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

Corn:

May corn was down a penny early within a 1 1/2-cent range and keeping a low profile in front of Friday's Prospective Planting and Grain Stocks reports. Brazil's weather continues to look favorable for early corn development with light to moderate showers expected across Mato Grosso, but the forecast for southern Brazil is drier. Early Thursday, USDA said last week's export sales and shipments of corn totaled 28.2 and 55.2 million bushels respectively, another bullish combination for the week even though sales were down from a week ago. Total corn exports in 2016-17 are now up 62% from a year ago and are a strong part of why I expect to see record corn demand in the first half of 2016-17 in Friday's report of Mar. 1 corn stocks. So far, May corn remains in a downtrend with prices benefiting from short-term support ahead of Friday's USDA reports. DTN's National Corn Index closed at $3.20 Wednesday, priced 38 cents below the May contract and near its lowest price in 2017. In outside markets, the June U.S. dollar index is up 0.20 with increased talk this week about more rate hikes in 2017.

Soybeans:

At 8 a.m. CDT, USDA announced 6.1 million bushels (165,000 mt) of U.S. soybeans were sold to China for 2017-18. May soybeans were down 4 1/4 cents earlier with ongoing bearish pressure from Brazil's record soybean harvest also taking Brazil's soybean prices to new lows and threatening future U.S. export business. In addition, spot palm oil fell to its lowest close overnight and pulled soybean oil lower as well. Early Thursday, USDA said last week's export sales and shipments of soybeans totaled 25.0 and 35.0 million bushels respectively, a bullish combination that has total exports up 15% from a year ago heading into Friday's USDA reports. USDA is expected to show a record high 88.1 million soybean acres and 1.68 billion bushels of soybean stocks on Mar. 1. USDA's poll of planting intentions is always suspect, but in this case, there is little argument with the notion that soybean acres will hit a new high. Soybean stocks will likely show record demand in the first half of 2016-17 and it should not be lost that world demand continues to stay on the heels of supply, even after several years of rising production. With Brazil's harvest presenting the latest bearish influence, May soybeans remain in a downtrend. DTN's National Soybean Index closed at $8.93 Wednesday, priced 76 cents below the May contract and near its lowest price in five months.

Wheat:

May Chicago wheat was down a cent early, a quiet response to two days of storms across the southwestern Plains that have now moved off to the east. More rain is expected to return this weekend and possibly again, later next week -- a beneficial change for winter wheat from the winter's drier pattern. Friday's reports are expecting to show the lowest U.S. wheat plantings in over a century, but even that is not expected to give prices a lift as supplies remain plentiful and exports uneventful. USDA said last week's export sales and shipments of wheat totaled 17.1 and 18.2 million bushels respectively, a neutral-to-bearish combination for the week that is making no dent in the large U.S. surplus. May Chicago wheat remains in a downtrend after this week's rain, but has a chance for short-term support at these lower prices. DTN's National SRW index closed at $3.84 Wednesday, priced 42 cents below the May contract and up from its lowest price in two months.

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

FollowTodd on Twitter @ToddHultman1

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