DTN Early Word Grains

By Darin Newsom
DTN Senior Analyst

6:00 a.m. CME Globex:

December corn was fractionally higher, November soybeans were 3 cents higher, and December Kansas City (HRW) wheat was 1 cent higher.

CME Globex Recap:

Similar to Wednesday morning, grain and oilseed markets were showing small gains early Thursday. The question is, like Wednesday, will the complex be able to stay higher through the close. The U.S. dollar is showing some strength as central bankers from around the world start a meeting Thursday in Jackson Hole, Wyoming. Gold was showing a small loss while DJIA future were higher. Crude oil was also under pressure to start the day.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 87.80 points (0.4%) lower at 21,812.09, the NASDAQ Composite lost 19.07 points (0.3%) to 6,278.41, and the S&P 500 dipped 8.47 points (0.4%) to 2,444.04 Wednesday. DJIA futures were 39 points higher early Thursday morning. Asian markets closed mixed with Japan's Nikkei down 80.87 points (0.4%), Hong Kong's Hang Seng up 116.93 points (0.4%), and China's Shanghai Composite off 16.19 points (0.5%). European markets were trading higher with London's FTSE 100 up 32.04 points (0.4%), Germany's DAX gaining 46.52 points (0.4%), and France's CAC 40 rallying 16.96 points (0.3%). The euro slipped 0.0023 to 1.1785 while the U.S. dollar index added 0.12 to 93.32. December 30-year T-Bonds were 2/32 lower at 155'06 while December gold lost $3.10 to $1,291.60. Crude oil was $0.23 lower at $48.18 while Brent crude slipped $0.16 to $52.41. China's Dalian soybean futures were lower and Malaysian palm oil futures were higher overnight.

	BULL		BEAR
1)	Light spillover buying from soybeans could support the corn market early Thursday.	1)	New-crop December corn posted another new contract low overnight.
2)	The minor (short-term) uptrend in new-crop November soybeans remains in place.	2)	Light commercial selling in soybeans could limit upside potential.
3)	Winter wheat markets remain sharply oversold, from a technical point of view.	3)	Cash HRW wheat prices in parts of the U.S. Southern Plains have fallen below government loan price levels.

The weekly Newsom on the Market column can be found on subscription sites only. On DTN Pro it is in News/Town Hall and on MyDTN in News/Columns.

MORE COMMODITY-SPECIFIC COMMENTS

CORN New-crop December corn posted another fresh contract low of $3.55 1/4 overnight, while old-crop September equaled its low from Wednesday of $3.41 1/2. Though trade volume was light, the fact commercial selling continues to be seen in the new-crop market could push the market lower by the close. Traders will take note of weekly export shipment numbers (for the week ending Thursday, August 17) Thursday morning, though this is unlikely to move prices much. Outside of finishing off the old-crop marketing year, there is little to do fundamentally until combines start to roll other than watch trucks bring some of last year's crop to town. Major (long-term) technical support is $3.54, then $3.39.

SOYBEANS New-crop November soybeans posted a relatively wide trading range of 14 1/4 cents Wednesday, allowing overnight trade to comfortably post an inside session. The contract was trading higher early Thursday, still in a minor (short-term) uptrend with initial resistance pegged at $9.50 3/4. Wednesday's high was $9.47. This week has seen the return of commercial selling in new-crop soybeans, a factor that could limit the range of the short-term uptrend. On the other hand, November soybeans don't have much room to the downside before testing major (long-term) technical support at $9.30 1/4. A move through that could trigger a slide back to the previous major low of $8.44 1/4.

WHEAT Winter wheat contracts were posting small gains early Thursday morning. That and a dollar will get you a $1 cup of coffee at certain fast food restaurants. The biggest story in winter wheat remains the wreck of the cash HRW market, with the DTN National HRW Wheat Index calculated at $3.32 Wednesday evening. This put national average basis at 66 cents under the Kansas City September contract, but that doesn't tell the whole story. More counties across Kansas and eastern Colorado are showing prices well below the national government loan price of $2.94. This means there are locations where loan deficiency payments (LDPs) have come back into play.

	DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.05	-$0.04	-$0.37	Sep	-$0.001
Soybeans:	$8.77	$0.01	-$0.61	Nov	$0.004
SRW Wheat:	$3.75	$0.00	-$0.28	Sep	-$0.007
HRW Wheat:	$3.32	-$0.01	-$0.66	Sep	-$0.001
HRS Wheat:	$6.00	-$0.01	-$0.39	Sep	$0.005

Darin Newsom can be reached at darin.newsom@dtn.com

Darin can be followed throughout the day at www.twitter.com\DarinNewsom

(KA)

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