DTN Closing Grain Comments

General Comments:

Corn was down 1 1/2 cents in the September contract and down 1 1/4 cents in the December. Soybeans were up 4 cents in the August contract and up 5 cents in the November. Wheat closed down 21 cents in the September Chicago contract, down 23 cents in the September Kansas City, and down 50 3/4 cents in the September Minneapolis contract.

The September U.S. dollar index is down 0.49 at 95.56. August gold is up $2.20 at $1,223.90 while September silver is up 10 cents and September copper is up $0.0005. The Dow Jones Industrial Average is down 123 at 21,355. August crude oil is up $0.29 at $45.42. August heating oil is up $0.0012 while August RBOB gasoline is up $0.0223 and August natural gas is up $0.046.

Corn:

December corn closed down 1 1/4 cents, pressured by Thursday's new seven-day forecast, which expects a broad coverage of timely showers over the central and eastern Midwest. Late Wednesday, USDA said that 10% of corn was silking and 68% of the crop was rated either good or excellent, putting DTN's Corn Condition Index up 2 points to 163 -- still the lowest in four years. As far as the Western Corn Belt is concerned, there is no significant precipitation in the forecast and it was no surprise that Thursday's U.S. Drought Monitor showed worsening conditions in the northwestern and western Plains. On the demand side, USDA said ethanol production remained high last week, at 1.014 million barrels per day while ethanol inventory dropped from 21.8 to 21.6 million barrels. U.S. ethanol exports totaled 119.2 million gallons in May, up 75% from a year ago while exports of distillers grains were down 28% from a year ago at 742,043 metric tons. So far, December corn remains in a sideways trend with commercial demand providing good support at $3.75 while traders keep an eye on the weather map. Early Thursday, 1,370 July corn contracts were delivered. DTN's National Corn Index closed at $3.47 Wednesday, priced 45 cents below the September contract and near its highest price in a year. In outside markets, the September U.S. dollar index is down 0.49 after ADP reported private sector jobs increased 158,000 in June, less than expected ahead of Friday's U.S. unemployment report.

Soybeans:

November soybeans closed up a nickel Thursday at another new three-month high as traders weighed the effects of worsening drought conditions in the western Midwest against a new seven-day forecast calling for a broad coverage of rain over the central and eastern Midwest. Late Wednesday, USDA said 18% of soybeans were blooming and 64% were rated good-to-excellent, dropping DTN's Soybean Condition Index to its lowest score in four years at 154. It is no surprise that the Dakotas are having the roughest time, but Indiana, Ohio, and Illinois also show poor-to-very poor ratings of 13%, 10%, and 8% respectively. Thursday's trading also saw December soybean meal close up $4.10 at a new three-month high while December soybean oil fell 0.33. So far this week, November soybeans have done a good job of sustaining the new uptrend while there remains plenty of uncertainty as to how this year's crops will turn out. On Friday morning, USDA will release its weekly report of export sales. Among July contracts, 962 soybeans and 261 soybean meal were delivered early Thursday. DTN's National Soybean Index closed at $9.16 Wednesday, priced 66 cents below the August contract and at a new three-month high.

Wheat:

September Kansas City wheat closed down 23 cents Thursday, just one day after making a new one-year high as traders start to show anxiety about the high price levels wheat has reached. Winter wheat prices have largely been carried along by concerns for this year's spring wheat crop as drought in the northwestern Plains has grown worse. That doesn't mean that winter wheat hasn't had its own issues, including numerous weather challenges and the persistence of mosaic virus. Late Wednesday, USDA said 53% of winter wheat was harvested and 48% of it was rated either good or excellent. DTN's Winter Wheat Condition Index of 118 is down from 156 a year ago, but not as bad as the 94 recorded in 2015. For spring wheat, there is no question that conditions are bad with DTN's Spring Wheat Condition Index showing the lowest score since 1988. USDA will release its first estimates of wheat production by classes on July 12 and the only question is: how much lower will this year's production be than last year? All three wheats remain in uptrends and the forecast still looks unfavorable for the northwestern Plains, but as trading volatility increases, it is fair to wonder if wheat prices are either close to or have already seen their highs. Among July contracts, 201 Chicago wheat and 408 K.C. wheat were delivered early Thursday. DTN's National SRW index closed at $5.28 Wednesday, priced 32 cents below the September contract and at its highest price in nearly two years. DTN's National HRW index closed at $4.98, 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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