DTN Closing Grain Comments

Soybean Meal Leads Ag Contracts Higher

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn was up 2 1/4 cents in the May contract and up 1 1/2 cents in the December. Soybeans were up 10 1/4 cents in the May contract and up 8 cents in the November. Wheat closed down 1 3/4 cents in the July Chicago contract, down 3 cents in the July Kansas City, and down 4 cents in the July Minneapolis contract. The June U.S. dollar index is down 0.83 at 99.04. June gold is down $12.70 at $1,276.40 while May silver is down 2 cents and May copper is up $0.0185. The Dow Jones Industrial Average is up 236 at 20,784. June crude oil is down $0.34 at $49.28. June heating oil is down $0.0110 while June RBOB gasoline is down $0.0191 and June natural gas is down $0.031.

Corn:

July corn closed up 1 3/4 cents Monday, still holding above its March low while planting remains difficult. Most of the Midwest was dry over the weekend and many areas will have another few days of planting opportunity. However, the rest of the seven-day forecast expects return of heavy rain amounts over most the Corn Belt with the heaviest totals targeted over Arkansas, Missouri, and Illinois. The demand side of the equation continues to offer prices reason for support and USDA posted another bullish report of weekly inspections Monday, totaling 57.2 million bushels. Friday's CFTC data showed noncommercials slightly bearish in corn with 36,742 contracts net short as of April 18. Commercials remain a source of support for April's lower corn prices, holding 47,757 contracts net long. So far, July corn is holding above its March low at $4.61 3/4, while Brazil's second corn crop is doing well and remains a bearish concern. 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 0.83, the flip side of Monday's rally in the euro after the first round of France's election gave a slight edge to the more pro-European candidate, Emmanuel Macron. The final election will be held on May 7 against Marine Le Pen.

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Soybeans:

July soybeans closed up 11 cents Monday, finally finding better demand after prices have been trending lower since February. Monday morning, USDA said 23.3 million bushels of soybeans were inspected for export, up from the previous week and enough to keep total inspections up 14% in 2016-17 from a year ago. It was not surprising that Friday's CFTC data showed noncommercial traders slightly bearish in soybeans with 12,673 net shorts as of April 18. Commercials however, were net long 73,859 contracts, the most since February 2016 and an encouraging sign of demand-based support for prices. While July soybeans remain in a downtrend and Brazil's record crop remains a source of bearish competition, harvest pressure may finally be easing. 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 closed down 1 3/4 cents with more rain on its way to the southwestern Plains this week and in spite of some new bullish concerns. Canada's western Prairie and North Dakota received snow over the weekend and on Monday, keeping last year's harvest still in the fields in many areas. Dry conditions in western Europe are slowly becoming more significant, and this week's rain forecast is especially heavy over Arkansas, Missouri, and Illinois -- likely damaging to wheat crops there. Friday's CFTC data showed noncommercial traders extremely bearish in Chicago wheat with 102,882 contracts net short as of April 18, the most since October 2016. Commercials were net long 96,882 contracts and are still wheat's primary source of price support. July Chicago and K.C. wheat contracts both remain in downtrends, but may not have much downside potential until more is known about this year's winter crops. DTN's National SRW index closed at $3.66 Friday, priced 39 cents below the May contract and near its lowest price in 2017. DTN's National HRW index closed at $3.16, also near its lowest price in 2017.

Todd Hultman can be reached at todd.hultman@dtn.com

Follow Todd Hultman on Twitter @ToddHultman1

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Todd Hultman