DTN Closing Grain Comments

General Comments:

Corn was down 5 1/2 cents in the July contract and down 5 cents in the December. Soybeans were down 8 1/4 cents in the July contract and down 7 3/4 cents in the November. Wheat closed down 4 3/4 cents in the July Chicago contract, down 5 1/2 cents in the July Kansas City, and down 5 cents in the July Minneapolis contract. The June U.S. dollar index is up 0.25 at 97.13. June gold is down $5.40 at $1,256.00 while July silver is down 5 cents and July copper is up $0.0015. The Dow Jones Industrial Average is up 41 at 20,936. July crude oil is up $0.25 at $51.38. July heating oil is up $0.0011 while July RBOB gasoline is down $0.0014 and July natural gas is down $0.102.

Corn:

July corn closed down 5 1/2 cents Tuesday and it was difficult to tell if traders really believed USDA's Crop Progress numbers or still think that corn will find a way to get planted. USDA said 84% of the corn crop was planted and 54% was emerged, in line with five-year averages, but of course, that does not account for acres that need replanting due to too much rain. More rain fell on Missouri and Illinois Tuesday and more moderate to heavy amounts are expected over the eastern half of the U.S. the next seven days. With final corn planting dates due in late May to early June, the window for replanting in the Eastern Corn Belt will soon be closing. Unfortunately, USDA's first estimate of prevented acres won't come until Aug. 10, so traders will be dealing with plenty of unknowns this summer. While weather factors remain bullish for corn, July corn prices continue to trade in a well-defined sideways range with no sign yet of taking a new direction. DTN's National Corn Index closed at $3.38 Monday, priced 37 cents below the July contract and at its highest price in 11 weeks. In outside markets, the June U.S. dollar index is trading up 0.25, possibly finding support near its lowest prices in six months. July crude oil is up 25 cents a barrel with OPEC set to meet Thursday and talk about a possible extension of production cuts.

Soybeans:

July soybeans closed down 8 1/4 cents Tuesday, pressured by a return of commercial selling and a 1.7% overnight drop in August palm oil futures. USDA's report that 53% of soybeans were planted and 19% were emerged also added bearish influence to Tuesday's prices, but like corn, did not account for soggy acres that will need to be replanted. State NASS offices did show surplus topsoil moisture at 35% and 46%, respectively, for Illinois and Indiana, up from 26% and 33% a year ago. FOB soybean prices are currently 9 cents a bushel lower in Brazil than at the U.S. Gulf, but the difference is still small enough to allow for more U.S. export business. Early Tuesday, USDA said 4.6 million bushels (126,000 mt) of U.S. soybeans were sold to unknown for 2016-17, adding to an outstanding sales total that is already 29 million bushel above USDA's export estimate for 2016-17. With 2017 off to a wet start in the southern and eastern Midwest, July soybeans continue to trade in a sideways range, above support at $9.41 1/4. DTN's National Soybean Index closed at $8.89 Monday, priced 68 cents below the July contract and down from its highest price in eight weeks.

Wheat:

July Chicago wheat closed down 4 3/4 cents Tuesday, pressured by a second day of commercial selling taking prices back down from Monday's attempt to trade above $4.40. Late Monday, USDA said 72% of winter wheat was headed and lowered the poor-to-very-poor crop rating from 17% to 15%. The NASS office in Kansas said 29% of the state had surplus topsoil moisture, but the northwest corner was at 49% and the southeast corner was 40%, both high readings. There does not seem to be much argument against the notion that the U.S. will have a smaller wheat crop in 2017, but just how much smaller is the big question. And, will problems crop up anywhere else around the globe this year? So far, the evidence is scant, but the year is still young. July Chicago wheat continues to chop sideways and appears to be building a base of support while noncommercials remain heavily bearish. DTN's National SRW index closed at $3.97 Monday, priced 38 cents below the July contract and down from its highest price in ten weeks. DTN's National HRW index closed at $3.56, down from its highest price in ten months.

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

Follow Todd Hultman on Twitter @ToddHultman1

(CZ)

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