DTN Early Word Grains

By Darin Newsom
DTN Senior Analyst

6:00 a.m. CME Globex:

May corn was 1 cent higher, May soybeans were 4 cents higher, and July Kansas City (HRW) wheat was 2 cents higher.

CME Globex Recap:

In an early morning rarity, the grain complex in general was trading higher before sunrise, though overnight volume still looked to be light. Soybeans led the way, building on Wednesday's rally, while corn was more than fractionally one way or the other. Outside markets were mostly higher led by the energy complex as crude oil recovered some of Wednesday's sharp loss. The U.S. dollar index was under heavy pressure once again while DJIA futures bounced back to trade higher.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 118.79 points (0.6%) higher at 20,404.49. The NASDAQ Composite gained 13.56 points (0.2%) to 5,863.03 and the S&P 500 lost 4.02 points (0.2%) to 2,338.17 Wednesday. DJIA futures were 43 points higher early Thursday morning. Asian markets closed mostly higher with Japan's Nikkei off 1.71 points, Hong Kong's Hang Seng up 231.10 points (1.0%), and China's Shanghai Composite gaining 1.41 points. European markets were trading mostly higher Thursday with London's FTSE 100 off 10.81 points, Germany's DAX gaining 28.71 points (0.2%), and France's CAC 40 up 52.01 points (1.0%). The euro was 0.0060 higher at 1.0771 while the U.S. dollar index was down 0.38 at 99.43. June 30-year T-Bonds were 12/32 lower at 154'12 while June gold lost $1.90 to $1,281.50. Crude oil was $0.37 higher at $50.81 while Brent crude added $0.44 to $53.37. China's Dalian soybean futures were lower while Malaysian palm oil futures were higher overnight.

	BULL		BEAR
1)	Weekly export shipments are expected to be strong for corn once again.	1)	Buying interest remains light at best in corn, meaning it could fade again before Thursday's close.
2)	Short-term trends remain up for both old-crop and new-crop soybean futures.	2)	Weekly export shipments of U.S. soybeans are expected to show a continued seasonal slowdown.
3)	Weekly wheat export shipments are also expected to be solid.	3)	It's getting late enough in the marketing year that wheat could see some of its unshipped sales rolled to the next marketing year.

The weekly Newsom on the Market column can be found on subscription sites only. On DTN Pro it is in News/Town Hall and on MyDTN in News/Columns.

MORE COMMODITY-SPECIFIC COMMENTS

CORN Corn was a full penny higher as of this writing early Thursday morning. While only a fraction different than most mornings, this small difference needed to be pointed out because everything else is the same in both old-crop and new-crop corn, including overnight trading ranges of less than 2 cents. The old-crop situation sees both the May and July futures contracts drifting sideways, with traders expecting another round of solid weekly export sales and shipment numbers (for the week ending Thursday, April 13). New-crop December could be influenced by another long line of thunderstorms that moved across the western Corn Belt Wednesday night, with forecasts for more on and off over the course of the weekend. December futures are also trending sideways on both its short-term daily and intermediate-term weekly charts.

SOYBEANS The bullish news for old-crop soybeans is that both the May and July contracts remain in minor (short-term) uptrends on their respective daily charts. The bad news is traders are expecting to see continued evidence of a seasonal slowdown in export shipment pace when weekly (for the week ending Thursday, April 13) numbers are release Thursday morning. There's also the issue of South American production, again providing support (rain as harvest tries to wind down) and resistance (record crop in Brazil) to both the old-crop and new-crop markets. AS for new-crop itself, the November contract is in a minor uptrend on its daily chart with an initial target of $9.67. Pushing much beyond that could require increased buying interest from an ongoing sell-off by the U.S. dollar.

WHEAT Winter wheat contracts were trading higher early Thursday morning, supported by the strong sell-off in the U.S. dollar index. The question will be if either Chicago (SRW) or Kansas City (HRW) can sustain enough buying interest over the course of the day to actually close higher. This has been a problem for both markets, given the underlying problem of bearish supply and demand. The new-crop July-to-September Chicago wheat spread is showing a carry of 14 cents, while the same spread in Kansas City is sitting at 15 1/4 cents early Thursday. Both are incredibly large carry figures that reflect no concern by commercial traders regarding possible tightening fundamentals. As for weekly export sales and shipments (for the week ending Thursday, April 13), traders are expecting another round of solid shipments. However, it's getting late enough in the 2016-2107 marketing year that some of the 200 mb-plus unshipped sales could start to be rolled over into the next marketing year.

DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.26	$0.00	-$0.36	May	$0.002
Soybeans:	$8.78	$0.04	-$0.72	May	$0.001
SRW Wheat:	$3.80	-$0.03	-$0.39	May	$0.008
HRW Wheat:	$3.27	-$0.03	-$0.90	May	-$0.002
HRS Wheat:	$4.97	-$0.01	-$0.40	May	$0.005

Darin Newsom can be reached at darin.newsom@dtn.com

Darin can be followed throughout the day at www.twitter.com\DarinNewsom

(KA)

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