DTN Closing Grain Comments

General Comments:

Corn closed up 5 cents in the July contract and up 5 cents in the December. Soybeans closed down 13 cents in the July and down 10 cents in the November. Wheat closed up 7 1/2 cents in the July Chicago, up 6 1/4 cents in the July Kansas City, and up 6 1/2 cents in the July Minneapolis. The June U.S. dollar index is up 0.18 at 97.36. June gold is up $12.00 at $1,268.40 while July silver is up $0.13 and July copper is down 0.0290. The Dow Jones Industrial Average is down 1 at 21,082. July crude oil is up $0.75 at $49.65. July heating oil is up $0.0097, July RBOB gasoline is up $0.0215, and July natural gas is up $0.045.

For the week:

July corn closed up 1 3/4 cents and December closed up 2 1/4 cents. July soybeans were down 26 1/2 cents while the November was down 22 1/2 cents. July Chicago wheat was up 3 cents, July Kansas City wheat was down 1/2 cent, and July Minneapolis wheatwas up 13 cents.

CORN:

July corn closed up a nickel Friday, salvaging a 1 3/4-cent gain on the week as prices continue to show no desire to leave the confines of their sideways trading range ahead of Memorial Day. The eastern Midwest got more unwelcome rain this week and one more batch of moderate showers is set to come up from Arkansas into the Ohio River Valley this weekend. After that, DTN's forecast for the eastern Midwest shows only light rain amounts the next 15 days with high temperatures struggling to reach 80 degrees. In South America, Brazil's second corn crop continues to do well and the Buenos Aires Cereals Exchange said 36% of Argentina's corn was harvested. Late Friday morning, USDA said there were nearly 11 million head of cattle on feed on May 1, up 2.0% from a year ago and more than expected. July corn did not react to the report, but increased livestock numbers in 2017 continue to be supportive for corn prices. Corn prices tend to turn more volatile after Memorial Day, but so far, July corn remains safely within its sideways range with support at the March low of $3.61 3/4. DTN's National Corn Index closed at $3.32 Thursday, priced 37 cents below the July contract and down from its highest price in 12 weeks. In related markets, August cattle were down 2.45 after USDA said nearly 11 million head were on feed on May 1, up 2.0% from a year ago and more than was expected.

SOYBEANS:

July soybeans fell 13 cents Friday and lost 26 1/2 cents on the week after prices broke to a new one-year low on Thursday. Until then, soybean prices had held sideways for seven weeks and attracted buying from the commercial sector, but buying interest proved feeble this week and bearish concerns too numerous. In addition to this year's record soybean harvest from Brazil, it is starting to look like soybean plantings will be able to proceed after this weekend and could reach USDA's estimate of a record high 89.5 million acres. This year's disappointing crush demand has also not helped the case for soybean prices early in 2017. USDA also expects a 57.0 mmt (2.1 b bu) soybean harvest from Argentina and, according to the Buenos Aires Cereals Exchange, 80% of that harvest is done. As I mentioned when USDA made its planting estimates in March, corn and wheat prices are holding steady while soybeans are taking it for the team this year. Unless a surprise erupts, that may be the theme for 2017 as July soybeans remain in a downtrend. DTN's National Soybean Index closed at $8.72 Thursday, priced 67 cents below the July contract and at its lowest price in six weeks.

WHEAT:

July Chicago wheat closed up 7 1/2 cents Friday and was up 3 cents on the week with more unwelcome rain expected around the Mississippi Delta and Ohio River Valley this weekend. That area is already too wet, creating one more item on this year's long list of challenges for the U.S. winter wheat crop. It is difficult to estimate wheat production before harvest, but given this year's lower plantings, roller-coaster weather adventures, and sightings of mosaic virus, USDA's estimate of a 21% smaller U.S. crop sounds reasonable and should help winter wheat prices stay supported in the low $4s. The most bullish wheat contract this year is Minneapolis spring wheat where commercials have been bidding front contracts higher and wet conditions have hampered fieldwork in the northern Canadian Prairies. July contracts for both, Chicago and K.C. wheat are holding sideways and appear to be building a base of support, but still lack a strong fundamental argument. DTN's National SRW index closed at $3.94 Thursday, priced 37 cents below the July contract and down from its highest price in eleven weeks. DTN's National HRW index closed at $3.53, down from its highest price in ten months. U.S. grain futures will resume trading at 7 p.m. CDT on Monday, May 29.

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

Follow Todd Hultman on Twitter @ToddHultman1

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