DTN Closing Grain Comments

General Comments:

Corn closed up 1 1/2 cents in the September contract and up 1 1/2 cents in the December. Soybeans closed up 7 1/4 cents in the September and up 4 3/4 cents in the November. Wheat closed up 1 3/4 cents in the December Chicago, up 1/4 cent in the December Kansas City, and down 1 3/4 cents in the December Minneapolis.

The September U.S. dollar index is down 0.15 at 93.38. December gold is up $1.60 at $1,294.00 while September silver is down $0.02 and September copper is down $0.0030. The Dow Jones Industrial Average is down 14 at 21,738. October crude oil is up $1.37 at $48.61. October heating oil is up $0.0402, October RBOB gasoline is up $0.0414, and October natural gas is down $0.035.

For the week:

September corn closed down 8 3/4 cents and December closed down 9 cents. September soybeans were down 3/4 cent while the November was down 7 1/4 cents. December Chicago wheat was down 24 1/2 cents, December Kansas City wheat was down 27 cents, and December Minneapolis wheat was down 5 3/4 cents.

Corn:

December corn closed up 1 1/2 cents Friday, but was still down 9 cents on the week, with ongoing bearish pressure from the anticipation of a sizeable, although smaller corn harvest in 2017. Friday's weather map showed scattered showers across North Dakota and southern Minnesota, but most of the Corn Belt is expected to be dry over the weekend. Early next week, moderate rain amounts are anticipated from Iowa to Ontario and the interest for corn prices will be to see if Iowa's drier areas are included. The good news for crops is that temperatures remain mild across the Midwest and Thursday's forecast from the Climate Prediction Center does not expect early freeze to be an issue this fall. USDA's August estimate of a 14.15 billion bushel harvest this fall seems high given this year's weather challenges, but 13.6 to 13.8 bb is possible and is still a lot of corn when added to 2.37 bb of old-crop carryover. Even if this year's corn crop does come in lower than expected, cash corn prices are not likely to show much benefit until after seasonal lows are made, typically around October. In the meantime, December corn remains under bearish pressure, near its lowest prices in 2017. DTN's National Corn Index closed at $3.12 Thursday, priced 38 cents below the September contract and at a new 2017 low. In outside markets, the September U.S. dollar index is down 0.15, still near its lowest prices in over two years with a rate hike possible at the Fed's Sept. 20 meeting.

Soybeans:

November soybeans closed up 4 3/4 cents Friday, cutting the week's loss to 7 1/4 cents, but still finding it difficult to trade higher. The possibility of another record soybean harvest also remains on the table in 2017. December soybean oil was Friday's winner among grain contracts with a gain of $0.42, assisted by recent strength in palm oil and canola prices. The seven-day forecast is anticipating moderate rain amounts next week from Iowa to Ontario with lesser amounts around eastern Nebraska and Kansas. This week's rains have been beneficial to soybeans in the western Midwest, but Iowa's driest areas are still waiting and rain next week would be helpful, if it comes through. The active pace of soybean export demand has been a distinct advantage for soybean prices once again this year and has kept prices above their June low of $9.07 so far. Also notice that September soybeans gained over six cents on the November contract this week as exports are pointing to another reduction in USDA's estimate of old-crop soybean stocks. Seasonal lows typically arrive around October, and that should be true again this year while the anticipation of harvest remains a bearish weight on new-crop prices for now. DTN's National Soybean Index closed at $8.71 Thursday, priced 62 cents below the November contract and still holding above its low in June.

Wheat:

December Kansas City wheat ended up a quarter-cent, but dropped 24 1/2 cents on the week to its lowest spot close in over three months. This was the sixth consecutive week lower since the high of $6.02 was reached on July 5, and there is no clear sign yet of having found the bottom. Winter wheat is also struggling with conflicting statistics as U.S. wheat production will be down 25% or more this year. USDA is estimating world ending wheat stocks to be at a new record high of 264.69 million metric ton (9.7 bb). The latest seven-day forecast has chances for moderate showers around Kansas and eastern Oklahoma while the northwestern U.S. remains mostly dry. That is good for the remaining spring wheat harvest and should also help fall planting conditions in the southwestern Plains. While winter wheat prices should be low enough to be close to support, futures spreads showing premiums above the cost of carry in distant months remain a source of bearish concern. DTN's National SRW index closed at $3.86 Thursday, priced 28 cents below the September contract and at its lowest price in three months. DTN's National HRW index closed at $3.47, also at its lowest price in three months.

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

Follow Todd on Twitter @ToddHultman1

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