DTN Before The Bell Grain Comments

Morning CME Globex Update:

December corn was up 7 1/2 cents, November soybeans were up 19 1/4 cents, and September Chicago wheat was up 14 cents. Early Monday, trading in December corn and November soybeans paused at their highest prices in 2017 while this week's best rain chances remain confined to the states near the Great Lakes. Wheat prices were also higher with hot and dry conditions expected to continue in the northwestern Plains.

Other Markets:

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

Corn:

December corn was up 7 1/2 cents early Monday at a new 2017 high with a seven-day forecast that remains dry in the western Plains while the bulk of rain remains confined to the states around the Great Lakes the next few days. High temperatures in the 90s will be common in the western Plains again this week while temperatures are more moderate in the eastern Midwest. The 8 to 14 day forecast expects below-normal precipitation over the entire central U.S. at a time when much of the corn will be pollinating. Friday's CFTC report showed noncommercials turned back net long in corn with a modest position of 43,480 contracts as of July 3. Wednesday's WASDE report is expected to show a small increase in USDA's ending corn stocks estimates, but none of USDA's estimates are likely to carry much weight in comparison to the weather stress that this new crop is seeing. A new 2017 high in December corn, if it holds by the close, will turn the trend higher in December corn as this year's weather concerns continue to defy corn's usual season tendencies. 803 July corn contracts were delivered early Monday. DTN's National Corn Index closed at $3.48 Friday, 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 up 0.10, but still trending lower.

Soybeans:

November soybeans were up 19 1/4 cents early Monday, challenging its highest price in 2017 as current forecasts described above continue to stress row crops in the western Plains and possibly increase the threat to the central Midwest. Friday's CFTC data was surprising in that it showed bearish noncommercials slow to react to soybeans' latest rally, still holding 59,429 contracts net short as of July 3. Commercials on the other hand, held 91,780 net longs, a strong vote of confidence for soybeans' economic value as prices neared $10.00. The trend in November soybeans turned higher one week ago and prices are now attempting to close higher for a tenth consecutive day with the 2017 high of $10.34 1/2 being tested. Among July contracts, 364 soybeans, 173 soybean meal and 18 soybean oil were delivered early Monday. DTN's National Soybean Index closed at $9.36 Friday, priced 65 cents below the August contract and near its highest price in four months.

Wheat:

September Chicago wheat was up 14 cents and K.C. wheat is up 12 1/2 cents early with Monday's forecast still looking hot and dry in the northwestern Plains for the next two weeks. Monday afternoon's Crop Progress report is likely to show deteriorating spring wheat conditions once again, while the dry conditions help advance the winter wheat harvest. Wednesday's WASDE report will offer a breakdown of wheat production estimates by class and winter wheat production is expected to total 1.26 billion bushels, said the analysts surveyed by Dow Jones. It took two years, but wheat prices have finally turned bullish enough to convince even the most entrenched bears in Chicago wheat. Friday's CFTC data showed noncommercials net long 14,757 contracts as of July 3, the first bullish position since July 2015. Commercials let go of their net long positions at spot wheat's highest prices in two years and will undoubtedly be glad to lend support again, should prices fall lower again in the future. For now, the trends remain up for all three wheats. Among July contracts, 47 Chicago wheat and 67 K.C. wheat were delivered early Monday. DTN's National SRW index closed at $5.02 Friday, priced 33 cents below the September contract and down from its highest price in nearly two years.

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

Follow Todd on Twitter @ToddHultman1

(BAS)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.