DTN Closing Grain Comments

Row Crops End Higher A Third Day

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn was up 8 1/2 cents in the September contract and up 8 1/2 cents in the December. Soybeans were up 13 1/2 cents in the August contract and up 14 1/2 cents in the November. Wheat closed up 2 3/4 cents in the September Chicago contract, up 3 1/2 cents in the September Kansas City, and up 2 1/2 cents in the September Minneapolis contract. The September U.S. dollar index is down 0.50 at 94.09. August gold is up $2.60 at $1,244.60 while September silver is up 4 cents and September copper is up $0.0055. The Dow Jones Industrial Average is down 18 at 21,622. September crude oil is down $0.37 at $46.95. September heating oil is down $0.0055 while September RBOB gasoline is down $0.0059 and September natural gas is down $0.019.

Corn:

December corn closed up 8 1/2 cents Thursday, buoyed by extremely hot temperatures across the central Midwest with the mid-90s expected to reach into Illinois. Thursday's U.S. Drought Monitor also showed expanded areas of dryness and drought in the western and central Midwest, including parts of Iowa and Illinois. The seven-day forecast expects a band of heavy showers from northeastern Iowa to Ohio with lesser amounts around the Great Lakes. Ohio is the one state that does not want more rain and other parts of the Midwest are expected to stay mostly dry with temperatures staying hot, at least through Saturday. Early Thursday, USDA said last week's export sales and shipments of corn totaled 18.4 million and 41.0 million bushels, respectively, a bullish combination that has total shipments up 30% in 2016-17 from a year ago with roughly six weeks remaining in the marketing year. Adverse weather continues to be the number one concern in 2017 and shows little sign of easing yet as we head deeper into July. So far, December corn remains in a volatile, sideways range and is approaching its high of two weeks ago. DTN's National Corn Index closed at $3.38 Wednesday, priced 44 cents below the September contract and in the middle of its wide, sideways trading range. In outside markets, the September U.S. dollar index is down 0.50 after European Central Bank President Draghi mentioned changes to quantitative easing may come in September, reported CNBC.com.

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Soybeans:

November soybeans closed up 14 1/2 cents Thursday, riding the same wave of support from weather described above for corn. Thursday morning's rains in northern Illinois and Indiana broke apart by early afternoon, leaving a mostly dry weather map as temperatures climb to the mid-90s and higher across the central Midwest. It seems an easy call to say USDA's next round of crop ratings will likely be lower Monday as this week's heat put extra stress on dry crops. While crop conditions are clearly deteriorating, we also have to keep in mind that we may be in the hottest week of the year and that soybean prices have a strong seasonal tendency to decline toward harvest. Early Thursday, USDA said last week's export sales and shipments of soybeans totaled 15.1 million and 13.2 million bushels respectively, a neutral-to-bearish combination that still keeps total shipments up 20% in 2016-17 from a year ago. Among soy products, both meal and oil advanced on commercial buying Thursday with December soybean oil gaining 0.57 and posting its highest close in four months. With weather risk still an ongoing concern for this year's soybean crop, November soybeans continue to trend higher. DTN's National Soybean Index closed at $9.35 Wednesday, priced 64 cents below the August contract and down from its highest price in four months.

Wheat:

September K.C. wheat ended up 3 1/2 cents, staying firm enough to hold just above the $5.00 mark after Thursday's U.S. Drought Monitor showed worsening drought conditions in the northwestern Plains and expanded areas of dryness in the southwestern Plains. Combined with this week's hot temperatures, that makes a rough mix for wheat crops, but it is also old news, which winter wheat prices quit responding to two weeks ago. On the demand side, USDA said last week's export sales and shipments of wheat totaled 24.6 million and 20.2 million bushels, bullish enough to have total shipments up 33% early in 2017-18. HRS wheat sales however, are down 35% from a year ago and shipments only up 4% with spot prices near a 3-year high. Technically, all three wheats remain in an uptrend and winter wheats may be finding support near $5.00. DTN's National SRW index closed at $4.72 Wednesday, priced 31 cents below the September contract and down from its highest price in two years. DTN's National HRW index closed at $4.34, also down from its highest price in two years.

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

Follow him on Twitter @ToddHultman1

(CZ)

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Todd Hultman