DTN Before The Bell Grain Comments

Morning CME Globex Update:

December corn was up 5 cents, November soybeans were up 2 3/4 cents, and September K.C. wheat was up 12 1/2 cents. Known for big price impacts, USDA's June 30 reports are just hours away from their 11 a.m. CDT release and grains were starting higher, led once again by gains in wheat.

Other Markets:

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

Corn:

December corn was up a nickel early Friday, a fairly bold move just a few hours before USDA releases its Acreage and June 1 Grain Stocks reports at 11 a.m. CDT. According to Dow Jones, analysts are expecting corn acres to be down roughly 4 million from a year ago and 5.16 billion bushels of June 1 corn stocks. Friday's weather map shows moderate to heavy rains around Oklahoma and Missouri with flood warnings in northern Missouri. Early next week, rain is expected from Missouri to Ohio, but other areas will be mostly dry. On Sunday, hotter temperatures are expected to return to the western Plains and will stress crops, especially in the northwestern Plains where drought prevails. So far, 2017 continues to show a variety of crop conditions and crop concerns which continue to suggest that a new national record yield will not be reached. With Friday's reports and plenty of weather uncertainty ahead, December corn is holding sideways, above support at $3.75. DTN's National Corn Index closed at $3.23 Thursday, priced 37 cents below the July contract and near its lowest price in twelve weeks. In outside markets, the September U.S. dollar index is up 0.12 while most commodities, other than gold, are starting higher.

Soybeans:

November soybeans were up 2 3/4 cents early Friday with USDA's reports due up at 11 a.m. CDT. Ever since making new lows late last week, soybean prices have been inching higher, a possible shoring up of positions ahead of Friday's numbers. June 1 soybean stocks are expected at 981 million bushels, but could get overlooked by Friday's acreage estimate. A bearish estimate of say, 92 million acres would likely send prices lower, but if the numbers come in shy of 90 million, as expected, it is possible that prices could finally hold support and starting trading on weather from here. Speaking of weather, DTN's seven-day forecast places the best rain chances in the southern and eastern Midwest with hotter temperatures adding to crop stress in the western Plains, starting Sunday. November soybeans remain in a downtrend with a potentially explosive report due out Friday morning. DTN's National Soybean Index closed at $8.54 Thursday, priced 62 cents below the July contract and near its lowest price in over a year.

Wheat:

September K.C. wheat was up 12 1/2 cents early, continuing to take advantage of a diminished selling presence while drought conditions worsen in the northwestern Plains, hot temperatures return to the western Plains, and talk of mosaic virus continues to accompany this year's winter wheat harvest. It is important to keep in mind that the world will still likely have plenty of wheat on hand at the end of the new season, but higher protein content will be harder to find. It is the prevalence of drought and hot and dry forecasts that has chased potential sellers away and is fueling the strong uptrends in wheat. This is a powerful bullish market dynamic, but it can also be unstable and end quickly. For now, all three wheats are clearly trending higher as we head toward the weekend. DTN's National SRW index closed at $4.63 Thursday, priced 17 cents below the July contract and at its highest price in a year.

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

Follow Todd on Twitter @ToddHultman1

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