DTN Before The Bell Grain Comments

Morning CME Globex Update:

July corn was up 2 cents, July soybeans were up 7 cents, and July Chicago wheat was up 3 cents. Grains and oilseeds were starting modestly higher, helped by Monday's lower U.S. dollar and signs of commercial demand for grains at April's lower prices. France's election results favored Emmanuel Macron and sparked buying in the euro and France's stock market.

Other Markets:

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

Corn:

July corn was up 2 cents early Monday, getting a bounce of support after testing its 2017 low on Friday. The Midwest was mostly dry over the weekend, but this week's forecast expects a broad coverage of heavy amounts, most of which will come late in the week and be especially heavy over Missouri, Illinois, and Arkansas. Friday's CFTC data showed noncommercials slightly bearish in corn with 36,742 contracts net short as of Apr. 18. Commercials continued to offer support for spot prices below $3.70, holding 47,757 contracts net long. So far, July corn is holding above the support of its March low at $3.61 3/4, but remains under bearish pressure with Brazil's second corn crop doing well and expecting rain later this week. DTN's National Corn Index closed at $3.22 Friday, priced 35 cents below the May contract and near its lowest prices in 2017. In outside markets, the June U.S. dollar index is down 0.91, the flip side of Monday's rally in the euro after the first round of France's election gave a slight edge to Emmanuel Macron. France's stock market is up 4.5% and is lending early bullish influence to U.S. stock index futures.

Soybeans:

July soybeans were up 7 cents early with support from modestly higher prices of both, meal and oil. Another oil contract, July canola, is also modestly higher Monday and on track for its seventh consecutive higher session. It seems odd that new-crop soybeans would be up Monday with heavy rains in this week's forecast, possibly pushing more acres into soybeans later, but commercial buying suggests good demand as prices slowly rise from their lowest level in a year. Friday's CFTC data showed noncommercial traders slightly bearish in soybeans with 12,673 net shorts as of Apr. 18. Commercials were net long 73,859 contracts, the most since February 2016 and another sign of demand-based support for prices. July soybeans remain in a downtrend with bearish reasons easy to find, but the outside weekly reversal of two weeks ago continues to provide support. DTN's National Soybean Index closed at $8.80 Friday, priced 71 cents below the May contract and up from its lowest prices in a year.

Wheat:

July Chicago wheat was up 3 cents early, in sympathy with corn and also helped by Monday's lower start in the U.S. dollar. More rain is headed toward the southwestern Plains this week and, as usual, the eastern side is expected to see more moisture than the western side. Weekend temperatures dipped below freezing in the northern Plains over the weekend and will return the next two days, but that is not abnormal for April. Friday's CFTC data showed noncommercial traders extremely bearish in Chicago wheat with 102,882 contracts net short as of Apr. 18, the most since October 2016. Commercials were net long 96,882, still the primary source of support for prices while traders have no reason to expect higher prices in early 2017. DTN's National SRW index closed at $3.66 Friday, priced 39 cents below the May contract and near its lowest price in 2017.

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

FollowTodd on Twitter @ToddHultman1

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