DTN Closing Grain Comments

By Darin Newsom
DTN Senior Analyst

General Comments:

July corn was unchanged at $3.67 3/4 with new-crop December 1/4 cent higher at $3.85 1/2. July soybeans finished 11 cents higher at $9.76 1/4 with new-crop November up 7 cents at $9.67 3/4. July Chicago wheat closed 1 cent higher at $4.24 1/4, July Kansas City lost 4 cents to $4.24 1/2, and July Minneapolis dipped 1/4 cent to close at $5.39 3/4. The U.S. dollar index was 0.75 lower at 98.13. June gold was $7.70 higher at $1,237.70 while July silver was $0.172 higher and July copper rallied $0.0115. The Dow Jones Industrial Average dipped 7 points to 20,975. June crude oil slipped $0.15 to $48.70. The June distillates (heating oil) contract was $0.0077 higher, June RBOB gasoline added $0.0090, while June natural gas fell $0.124.

Corn:

Spillover support from a surging soybean market pulled corn contracts back to near unchanged late in the day. For much of Tuesday's session, it was difficult to tell if corn was even open as contracts stayed in narrow ranges. However, just past the midpoint both old-crop and new-crop started to leak lower, following wheat. If not for a move to double-digit gains by old-crop soybeans corn would likely have finished near session lows as noncommercial traders continue to sell. Given the lack of interest in the market, outside of influence from the other grains, it would not be surprising to see more of the same - a slow grind lower - overnight into early Wednesday morning.

Soybeans:

Strong commercial buying of old-crop was the key to the impressive rally in soybeans Tuesday. The July-to-August spread traded at an inverse late in the day before closing at par. This would hint at another round of export sales announced in the near future, similar to the 132,000 metric tons of 2016-2017 supplies to unknown Tuesday morning. New-crop November wasn't as action and may have tried to close lower if not for the rally by old-crop over the latter half of the session. Most of the buying in the November contract came from noncommercial traders, as indicated by little change in carry of the new-crop forward curve.

Wheat:

Heading into the last hour or so of Tuesday's session, things were looking grim for winter wheat contracts. Kansas City July had just moved to a new session low of 44.21, down 7 1/2 cents for the day, and July Chicago was following along at a distance. Then, like corn, both winter wheat markets were pulled back from the ledge by the strong rally in soybeans. So much so that Chicago was actually able to close higher, the weakening carry possibly misleading in its hint of commercial buying interest. More likely noncommercial short-covering in the July contract happened so late in the session that the September issue had little chance to react. Whether or not this is the case should be evident in Wednesday's spread activity.

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

Follow Darin Newsom on Twitter @DarinNewsom

(BAS)

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