DTN Closing Grain Comments

General Comments:

Corn was down 2 1/2 cents in the September contract and down 3 cents in the December. Soybeans were up 3 cents in the September contract and up 3 1/2 cents in the November. Wheat closed down 6 1/2 cents in the September Chicago contract, down 6 1/4 cents in the September Kansas City and up 4 3/4 cents in the September Minneapolis contract.

The September U.S. dollar index is up 0.17 at 93.48. December gold is down $3.00 at $1,261.70 while September silver is up 13 cents and September copper is up $0.0330. The Dow Jones Industrial Average is up 7 at 22,125. September crude oil is down $0.19 at $49.20. September heating oil is down $0.0111 while September RBOB gasoline is down $0.0005 and September natural gas is up $0.016.

Corn:

December corn closed down 3 cents Tuesday, showing caution ahead of Thursday's WASDE report, and with good reason, as prices could get volatile after the release, depending on what USDA says and how traders respond. Expectations are high for a lower corn yield estimate Thursday and the latest seven-day forecast contributes more to crop concerns as the central Midwest is only expecting light amounts while heavier rains move across the southern U.S. Late Monday, USDA said corn crops were close to their typical developmental pace and took the good-to-excellent rating down 1 point to 60%. That makes this corn crop the seventh worst since 2000, but it is probably still good enough to come up with 13.6 billion bushels or more at harvest. Corn export sales have dragged lately as cheaper prices currently favor Brazil. So far, December corn has held above support at $3.75, but Thursday's report may challenge that 10-month line in the sand. DTN's National Corn Index closed at $3.31 Monday, priced 41 cents below the September contract and staying within its sideways range in 2017. In outside markets, the September U.S. dollar index is up 0.17 while other commodities are quietly mixed.

Soybeans:

November soybeans closed up 3 1/2 cents Tuesday, showing some bullish stubbornness in the face of a slightly lower crop rating from USDA. Late Monday, USDA said 90% of soybeans were blooming, 65% were setting pods and 60% of the crop was rated good or excellent, a point higher than last week. DTN's Soybean Condition Index increased four points to 143, making this the seventh lowest rated soybean crop since 2000. The catch, of course, is that with record soybean plantings in 2017, even a lower, 47.0 bushel yield estimate can still produce 4.2 bb of soybeans this fall. But we are not there yet, and the latest seven-day forecast has chances for moderate rain around parts of the Midwest, but largely misses North Dakota and the three I-states. With a volatile response possible from Thursday's WASDE report, November soybeans remain in an uptrend with support at $9.55 1/2, the site of the five-week low. DTN's National Soybean Index closed at $9.02 Monday, priced 68 cents below the November contract and holding sideways, above $8.80. Among August contracts, there were 256 deliveries of soybeans, 176 deliveries of meal and 70 deliveries of soybean oil early Tuesday.

Wheat:

September Chicago wheat closed down 6 1/2 cents, taking back most of Monday's gain with moderate to heavy rains expected across the Southern Plains the next seven days. The rain won't help this year's production, but does put money in the ground for fall planting. USDA said late Monday that USDA said 94% of winter wheat and 24% of spring wheat crops were harvested, close to their normal paces. With this year's drought in the northwestern Plains, the spring wheat crop is significantly lower than a year ago and there is room for USDA to drop its 423 million bushel estimate of other spring wheat production further on Thursday. It also seems likely that there is room for USDA to reduce its estimate of world ending wheat stocks for 2017-18, but world supplies are still a long way from generating bullish price concerns. Thanks to lower U.S. wheat production in 2017, winter wheat prices should be close to finding support for a sideways trading range. DTN's National SRW index closed at $4.34 Monday, priced 30 cents below the September contract and near its lowest prices in seven weeks. DTN's National HRW index closed at $3.99, also near its lowest prices in seven weeks.

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

Follow him on Twitter @ToddHultman1

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