DTN Early Word Grains
A Mostly Green Morning, Even in Wheat
December corn was unchanged, November soybeans were 5 cents higher, and December Chicago (SRW) wheat was 1 cent higher.
CME Globex Recap:Grain and oilseed markets were mostly higher early Wednesday morning with only soybean meal lower and Malaysian palm oil mixed. Light support came from a small sell-off in the U.S. dollar index, though the energy complex was lower. Gold posted a minor rally as sellers returned to DJIA futures.
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The Dow Jones Industrial Average closed 196.14 points (0.9%) higher at 21,899.89, the NASDAQ Composite gained 84.35 points (1.4%) to 6,297.48, and the S&P 500 added 24.14 points (1.0%) to 2,452.51 Tuesday. DJIA futures were 40 points lower early Wednesday morning. Asian markets closed mostly higher with Japan's Nikkei up 50.80 points (0.3%) and China's Shanghai Composite down 2.52 points. European markets were trading lower with London's FTSE 100 down 2.12 points, Germany's DAX off 9.58 points, and France's CAC 40 losing 2.05 points. The euro gained 0.0018 to 1.1779 while the U.S. dollar index dipped 0.06 to 93.43. December 30-year T-Bonds were unchanged at 154'12 while December gold added $1.00 to $1,292.00. Crude oil was $0.11 lower at $47.72 while Brent crude slipped $0.20 to $51.67. China's Dalian soybean futures were higher and Malaysian palm oil futures were mixed overnight.
| BULL | BEAR | ||
| 1) | Light spillover buying from soybeans could support the corn market. | 1) | Old-crop September corn moved to a new contract low overnight. |
| 2) | The minor (short-term) uptrend in new-crop November soybeans continues to build momentum. | 2) | Light commercial selling in soybeans could limit upside potential. |
| 3) | Winter wheat markets remain sharply oversold, from a technical point of view. | 3) | New-crop July 2018 Kansas City wheat posted a new contract low during Tuesday's session. |
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MORE COMMODITY-SPECIFIC COMMENTSCORN The most notable factor for corn overnight was old-crop September posting a new contract low of $3.45 3/4. Of course this occurred during low volume trade with only 4,400 contracts (futures only) registering through early Wednesday morning. The market in general was quiet with narrow trading ranges of 2 cents or less seen throughout. New-crop December continues to erode toward its contract low of $3.58 1/2, quietly hitting $3.59 1/2 during the overnight session. Neither side (commercial, noncommercial) seem willing to do much at this point, at least until combines start rolling through fields and actual yield numbers become known. As for the DTN National Corn Index (NCI.X, national average cash price), it has posted a new 2017 low this month and looks on its way to moving below $3.00. Tuesday night saw the NCI.X calculated near $3.09 1/4.
SOYBEANS Soybean contracts were trading higher early Wednesday, though had given back gains seen earlier that had new-crop November as much as 9 1/2 cents higher. So far this week Nov beans have worked on building the recently established short-term uptrend on its daily chart, moving toward initial technical price resistance at $9.50 3/4. This price marks the 23.6% (Fibonacci) retracement level of the previous minor downtrend from $10.47 through the low of $9.21. Though the contract is expected to extend its short-term uptrend to the $9.69 to $9.84 area, light commercial selling this week could continue to slow progress. As with new-crop corn, commercial traders seem content to sit back and wait for actual harvest yields to start rolling in.
WHEAT Tuesday saw July 2018 Kansas City wheat post a new contract low of $4.77, equaling that price during the overnight session before climbing slightly through early Wednesday morning. Though winter wheat in general is sharply oversold, little buying interest has been seen from either commercial or noncommercial traders. In fact the former group has been actively selling, pushing the old-crop September-to-December Chicago spread to a carry of 27 cents, and the December-to-March out to 23 1/2 cents.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.09 | -$0.03 | -$0.37 | Sep | $0.004 |
| Soybeans: | $8.76 | $0.02 | -$0.61 | Nov | $0.006 |
| SRW Wheat: | $3.74 | -$0.06 | -$0.28 | Sep | $0.013 |
| HRW Wheat: | $3.33 | -$0.07 | -$0.66 | Sep | $0.013 |
| HRS Wheat: | $6.01 | -$0.13 | -$0.40 | Sep | $0.012 |
Darin Newsom can be reached at darin.newsom@dtn.com
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