DTN Early Word Grains

Soybeans a Little Higher, Grains Quiet

Todd Hultman , DTN Grains Analyst
6:00 a.m. CME Globex:

May corn was unchanged, May soybeans were up 2 1/2 cents, and May Chicago wheat was up 1/2 cent.

CME Globex Recap:

May soybeans were modestly higher early Friday while corn and wheat stayed near Thursday's lower closes with little fresh news expected at the end of the week. Rain with severe weather threats are moving through the southwestern Plains Friday morning.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed up 174.22 points at 20,578.71. The NASDAQ Composite was up 53.75 points at 5,916.78 and the S&P 500 was up 17.67 points at 2,355.84 Thursday. DJIA futures were down 4 points early Friday morning. Asian markets were mixed with Japan's Nikkei up 190.26 points (1.0%), Hong Kong's Hang Seng down 15.96 points (-0.06%), and China's Shanghai Composite up 1.05 points (0.03%). European markets were lower Friday with London's FTSE 100 down 10.33 points (-0.15%), Germany's DAX down 14.33 points (-0.12%), and France's CAC 40 down 48.85 points (-0.96%). The U.S. dollar index was up 0.02 at 99.86 while the June euro was down 0.00175 at 1.07320. June 30-year T-Bonds were steady at 154'05 while June gold was down $1.00 at $1,282.80. June crude oil was unchanged at $50.71 while June Brent crude was up $0.01 at $53.00. Soybeans at the Dalian Exchange were mixed and Malaysian palm oil futures are up 1.0%.

BULL BEAR
1) May corn continues to hold above its March low of $3.54 1/4 while this year's spring weather has been too wet for planting in many areas 1) So far, growing conditions have been good for Brazil's second corn crop and there is more beneficial rain in the forecast.
2) May soybeans continue to trade above the low of last week's outside reversal. 2) Large supplies of freshly harvested soybeans in Brazil continue to hang over the market's head.
3) Commercials are offering passive support in wheat, but not enough to stop the downtrend. 3) Winter wheat crops are off to a good start in 2017 with no major problems yet. The U.S. dollar index is at risk of trading higher, if French presidential candidate Marine Le Pen has a strong showing in Sunday's election.

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 May corn is unchanged early in light trading with showers around the southern Plains and severe weather around the Texas Panhandle, expected to move across the southern Midwest later Friday. This has been a tough week for corn prices after giving back last week's gain without much of a fight. Favorable weather for Brazil's second crop continues to keep corn prices under pressure and is outweighing any concerns about this spring's slower planting pace here in the U.S. The northern Midwest will be drier the next several days, but then more rain is expected later next week. Corn planting remains a challenge in 2017, but May corn prices remain under bearish pressure and so far, are holding above support at $3.54 1/4.

SOYBEANS May soybeans are up 2 1/2 cents, finding early support from light buying in meal. We have seen this familiar pattern of early buying in meal fall apart later in the day several times so it is easy to be suspicious of Friday's higher start. Soybean harvest is currently taking place in Argentina and being helped by a much drier seven-day forecast. Moderate showers are expected in southern Brazil, but that harvest is already near the end. With record supplies coming from Brazil and the U.S. expected to have a record planting in 2017, May soybeans remain under bearish pressure with possible support at last week's low of $9.29 3/4.

WHEAT May Chicago wheat is up a half-cent early, but still near its contract low after Thursday saw a collapse of winter wheat prices. Friday morning's weather map shows scattered to heavy showers around the southwestern Plains with severe weather threat around the Texas Panhandle. Overall, the moisture is beneficial to crops and there may be more on the way late next week. Outside the U.S., major crop areas report no serious problems, but dry conditions in western Europe deserve watching. With plenty of surplus old-crop wheat in the U.S. and more on the way in June, May Chicago wheat remains in a downtrend, under bearish pressure.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $3.22 -$0.04 -$0.36 May $0.002
Soybeans: $8.75 -$0.03 -$0.72 May $0.002
SRW Wheat: $3.67 -$0.13 -$0.40 May $0.000
HRW Wheat: $3.14 -$0.13 -$0.89 May $0.008
HRS Wheat: $4.87 -$0.10 -$0.40 May $0.002

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

Toddcan be followed throughout the day at www.twitter.com\ToddHultman1

(KA)