DTN Closing Grain Comments

General Comments:

Corn was up 3 1/2 cents in the September contract and up 4 3/4 cents in the December. Soybeans were up 11 3/4 cents in the August contract and up 13 1/2 cents in the November. Wheat closed up 5 cents in the September Chicago contract, up 10 cents in the September Kansas City and up 3 3/4 cents in the September Minneapolis contract.

The September U.S. dollar index is up 0.18 at 96.15. August gold is up $1.10 at $1,220.30 while September silver is down 19 cents and September copper is down $0.0340. The Dow Jones Industrial Average is down 8 at 21,471. August crude oil is down $1.75 at $45.32. August heating oil is down $0.0315 while August RBOB gasoline is down $0.0278 and August natural gas is down $0.115.

Corn:

December corn closed up 4 3/4 cents Wednesday, trading in a narrower version of Monday's range as traders try to assess this summer's mixed crop conditions. Wednesday afternoon's Crop Progress report is likely to show lower corn crop ratings in the western Midwest and possibly higher ratings in the eastern Midwest while the current weather pattern continues to favor the eastern Midwest with moderate temperatures and occasional showers. DTN's seven-day forecast continues the same pattern but has the added twist of even hotter temperatures in the western Plains, stressing crops that are getting ready to pollinate. Meanwhile, corn exports from South America are picking up as Brazil's harvest makes progress and is offering more competition to the U.S. U.S. corn shipments are up 36% in 2016-17 from a year ago, but FOB corn prices are now 10 cents a bushel cheaper at Brazil's ports. December corn remains in a sideways trend and is challenging the 2017 high of $4.09. Early Wednesday, there were 1,302 deliveries of July corn. DTN's National Corn Index closed at $3.42 Monday, priced 47 cents below the September contract and back near its highest prices in a year. In outside markets, the September U.S. dollar index is up 0.18, and still benefiting from Friday's stronger-than-expected report on U.S. manufacturing.

Soybeans:

November soybeans closed up 13 1/2 cents Wednesday to a new three-month high, likely still finding help from noncommercial short-covering after Friday's CFTC report revealed speculators holding record net-short positions as of June 27. As with corn, soybean crop conditions are also likely to show the same east/west divide in Wednesday afternoon's Crop Progress report and DTN's extended forecast expects more of the same the next 10 days. Weather still controls the keys to future soybean prices and it will be interesting to see if soybeans can sustain their new uptrend once the burst of short-covering subsides. For now, the outlook for soybeans is especially confusing as the trend in November soybeans is up, but there is still a possibility of increased soybean supplies in 2017-18, and we are on the downhill side of the five-year seasonal tendency. Among July contracts, 1,048 soybeans, 10 soybean meal, and 63 soybean oil were delivered early Wednesday. DTN's National Soybean Index closed at $9.03 Monday, priced 67 cents below the August contract and at a new six-week high.

Wheat:

September Kansas City wheat closed up a dime, reaching its contract high on its sixth consecutive close higher. September Minneapolis wheat had a volatile day and managed to close up just 3 3/4 cents even though prices traded up 52 1/2 cents shortly after the 8:30 open. The forecast remains as bullish as ever for spring wheat with no significant moisture expected the next 10 days while temperatures turn hot. Wednesday afternoon's crop ratings for spring wheat are also likely to show another drop, but with spot prices already near their highest level in four years, it is fair to wonder if we are reaching the upper limit of this bull move (see Wednesday's DTN article, "When Prices Go Vertical"). Similarly, winter wheat prices have been tagging along for the ride and are near their highest spot prices in two years. So far, the trends for all three wheats remain up, offering their most attractive selling opportunities in a long time. Among July contracts, 217 Chicago wheat and 455 K.C. wheat were delivered early Wednesday. DTN's National SRW index closed at $5.23 Monday, priced 32 cents below the September contract and at its highest price in nearly two years. DTN's National HRW index closed at $4.86, near its highest price in two years.

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

Follow him on Twitter @ToddHultman1

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