DTN Early Word Grains
Grains are Green, at Least on the Screen
December corn was 8 cents higher, November soybeans were 20 cents higher, and September Kansas City (HRW) wheat was 13 cents higher.
CME Globex Recap:Grains opened Sunday evening's session higher and never faltered through early Monday morning. Minneapolis spring wheat once again led the charge, followed closely by soybeans, then winter wheat, and finally corn. On the other hand outside markets were trading higher Sunday evening before losing bullish momentum overnight. Continued strength in the U.S. dollar brought sellers back to metals and energies, while softs were mostly higher. Cotton was one of the latter that struggled, showing a small loss Monday morning.
OUTSIDE MARKETS:The Dow Jones Industrial Average closed 94.30 points (0.4%) higher at 21,414.34, the NASDAQ Composite gained 63.61 points (1.0%) to 6,153.08, and the S&P 500 rallied 15.43 points (0.6%) to 2,425.18 Friday. DJIA futures were 6 points higher early Monday morning. Asian markets closed mostly higher with Japan's Nikkei up 151.89 points (0.8%), Hong Kong's Hang Seng gaining 159.21 points (0.6%), and China's Shanghai Composite off 5.32 points (0.2%). European markets were trading mostly higher with London's FTSE 100 up 23.60 points (0.3%), Germany's DAX up 57.95 points (0.5%), and France's CAC 40 gaining 16.43 points (0.3%). The U.S. dollar index gained 0.17 to 96.17. September 30-year T-Bonds were 16/32 higher at 152'05 while August gold lost $2.70 to $1,207.00. Crude oil was $0.32 lower at $43.91 while Brent crude fell $0.33 to $46.38. China's Dalian soybean and Malaysian palm oil futures were both higher overnight.
P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
| BULL | BEAR | ||
| 1) | December corn took out its previous double-top at $4.09 (on its weekly chart) indicating its long-term trend could now extend. | 1) | Weekly export inspections of corn could show export demand continues to slow. |
| 2) | November soybeans left a second consecutive bullish price gap on its weekly chart. | 2) | A stronger U.S. dollar could limit new commercial buying in soybeans. |
| 3) | The Northern Plains spring wheat growing area saw little to no rain over the weekend, fueling renewed commercial buying overnight. | 3) | Commercial selling could continue in winter wheat markets. |
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MORE COMMODITY-SPECIFIC COMMENTSCORN December corn finally cleared a bullish hurdle overnight, taking out its double-top at the $4.09 level. Given previous activity, and based on the major (long-term) uptrend on its monthly chart, Dec corn now looks to be in position to extend its rally to the $4.45 to $4.50 area (for more information, see recent updates to DTN's Technically Speaking blog). While based on technical patterns, the bullish move continues to be driven by weather. Maps showing precipitation for the last 7 days (through Sunday, July 9) show most of the U.S. growing areas falling short of what's needed by the crop each week. This should play a role in Monday afternoon's weekly condition numbers from NASS. Look for Monday's session to be a normal extension of weather-market weekend trade added to Friday's rally. Delivery of 803 contracts was reported against the July issue, putting the total at 8,322 contracts.
SOYBEANS For the second consecutive week new-crop November soybeans opened sharply higher Sunday evening, leaving a bullish price gap on its weekly chart. The strong rally has seen Nov beans quickly climb from its recent low of $9.07 (week of June 19) to challenge its high of $10.43 (week of November 28, 2016). A long-term bullish commercial view of fundamentals, indicated by soybeans' new-crop forward curve, continues to push the market higher. Old-crop has also performed well over the last few weeks, and could receive added fuel if weekly export inspections (for the week ending Thursday, July 6) come in bullish Monday morning. Delivery of 364 contracts was reported against the July issue, putting the total at 5,313 contracts.
WHEAT Following the Sunday evening rally that lasted through early Monday morning, winter wheat contracts once again showed the only price charts that remain in effect are its long-term monthly chart. There, major uptrends remain in place while last week's activity left weekly charts looking as if tops were forming. Trade looks to be driven by continued noncommercial buying, while stronger carries in futures spreads overnight would suggest renewed commercial selling. If realized during Monday's session, this type of divergence usually favors the commercial side - eventually. On the other hand, strong commercial buying continues to be seen in Minneapolis spring wheat as the Northern Plains growing area once again missed out on rains over the weekend. Delivery of 47 contracts was reported against the July Chicago, putting its total at 947 contracts. Another 67 contracts were reported delivered against the July Kansas City issue increasing its total to 2,073 contracts.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.48 | $0.02 | -$0.45 | Sep | $0.001 |
| Soybeans: | $9.36 | $0.16 | -$0.65 | Aug | $0.005 |
| SRW Wheat: | $5.02 | -$0.04 | -$0.33 | Sep | -$0.003 |
| HRW Wheat: | $4.74 | -$0.03 | -$0.69 | Sep | $0.008 |
| HRS Wheat: | $7.26 | -$0.03 | -$0.41 | Sep | -$0.005 |
Darin Newsom can be reached at darin.newsom@dtn.com
Darin can be followed throughout the day at www.twitter.com\DarinNewsom
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