DTN Before The Bell Grain Comments

Morning CME Globex Update:

December corn was down 7 cents, November soybeans were down 24 1/2 cents, and September Chicago wheat was down 12 3/4 cents. Corn, soybeans, and all three wheats were sharply lower early Thursday after rains fell across the central Midwest, ushering in more moderate temperatures. The seven-day forecast continues to expect more rain in the eastern Midwest and drier conditions in the western Midwest.

Other Markets:

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

Corn:

December corn was down 7 cents, still getting pressure from USDA's higher estimates of U.S. ending corn stocks and a fresh flow of scattered showers across the central Midwest. Heavy rain amounts resulted in flooding in parts of eastern Iowa, Wisconsin, and northern Illinois. More scattered showers are expected across the central Midwest Thursday before weather turns drier over the weekend. Early Thursday, USDA said last week's export sales and shipments of corn totaled 6.3 and 34.7 million bushels respectively, a neutral combination for the week. Total corn shipments are up 32% from a year ago, but new sales have fallen off as South America's corn is now competing and offering a cheaper price. While December corn has fallen back sharply from Monday's new high, prices continue to maintain a sideways range with commercials helping provide support at $3.75. 284 July corn contracts were delivered early Thursday. DTN's National Corn Index closed at $3.41 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 0.02, staying in its downtrend after Fed Chairman Yellen repeated the Fed's commitment to gradual rate hikes in Wednesday's Congressional testimony.

Soybeans:

November soybeans were down 24 1/2 cents early after scattered showers crossed the central Midwest overnight and ushered in a few days of more moderate temperatures. While the Midwest is getting some relief, there is still no significant rain expected in the northwestern Plains with triple-digit temperatures returning after Thursday. Looking ahead, the same east/west split continues to place the better rain chances and more moderate temperatures in the eastern Midwest while the western Midwest is expected to be hotter and drier. Early Thursday, USDA said last week's export sales and shipments of soybeans totaled 8.4 and 15.0 million bushels respectively, a neutral-to-bearish combination that has total soybean shipments up 20% in 2016-17. December soybean meal is down $8.70 after USDA reported export sales of meal hit a new marketing year low for 2016-17. Technically, the trend is still up for soybeans, but Thursday's sharp drop in prices shows a sharp change in momentum as prices deal with changing weather data in a volatile summer season. Among July contracts, 88 soybeans, 52 soybean meal and 43 soybean oil were delivered early Thursday. DTN's National Soybean Index closed at $9.54 Wednesday, priced 67 cents below the August contract and near its highest price in four months.

Wheat:

September Chicago wheat was down 12 3/4 cents early, still pressured by USDA's higher-than-expected ending stocks estimates and drop in corn prices. Wheat's lower prices do not mean that drought concerns have eased in the northwestern Plains as triple-digit temperatures are expected to return to the region after Thursday and there is still no rain in the seven-day forecast. Even so, winter wheat prices do appear to be losing their bullish enthusiasm and continue to fall back from last week's high. Early Thursday, USDA said last week's export sales and shipments of wheat totaled 13.1 and 17.5 million bushels respectively, bearish amounts for the week, but total wheat shipments are up 30% in 2017-18 from a year ago, well above USDA's estimated pace for an 8% drop in exports. Technically, the trends remain up in all three wheats, but spring wheat still has the most bullish fundamental argument and winter wheat prices have lost their upward momentum. Among July contracts, 69 Chicago and 11 K.C. wheat were delivered early Thursday. Open interest is dangerously low for all three July wheat contracts. DTN's National SRW index closed at $5.04 Wednesday, 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.