DTN Before The Bell Grain Comments

Morning CME Globex Update:

At 8 a.m. CDT, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to China for 2017-18. 105,500 mt of U.S. soybean meal were also sold to Thailand for 2017-18. Grains were quietly mixed earlier Friday as the country's attention turns to the approach of Hurricane Harvey on the Texas coast. Expected to become a category three hurricane, Harvey will be packing high winds and promises heavy flooding.

Other Markets:

Dow Jones:	Higher
U.S. Dollar Index:	Lower
Gold:	Lower
Crude Oil:	Higher

Corn:

December corn was down a half-cent early, staying near its lowest prices of the year while concerns increase about the threat of Hurricane Harvey on the Texas coast. As serious as the hurricane is for southern Texas, the direct impact on grains is likely to come in the form of increased rain along the Mississippi Delta and possible transportation problems along the river. Otherwise, the seven-day forecast looks mild with chances for showers in the northern and eastern Midwest. Overall, the bearish tone in corn prices is expected to continue with a large, possibly 13.8 billion bushel harvest on the way and commercials showing no concern about their need to obtain supplies. December corn remains in a downtrend. DTN's National Corn Index closed at $3.06 Thursday, priced 36 cents below the September contract and near its 2017 low. In outside markets, the September U.S. dollar index is down 0.02 ahead of Friday's speeches from Jackson Hole, Wyoming. Energy futures are modestly higher as Hurricane Harvey threatens the Texas coast.

Soybeans:

At 8 a.m. CDT, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to China for 2017-18. 105,500 mt of U.S. soybean meal were also sold to Thailand for 2017-18. Before the announcements, November soybeans were down 1 1/4 cents, keeping a low profile and possibly setting up for a quiet finish to what has been a relatively quiet week of trading. It is difficult to say yet, but mild temperatures and timely rains in August may have given enough of the crop a boost to come close to last year's record harvest of 4.31 billion bushels. The fact that prices are on track for a modest gain this week has come about thanks to this week's Commerce Department ruling in favor of U.S. biodiesel producers and a continuation of active demand for new-crop soybeans. As is usual for this time of year, November soybeans remain under bearish pressure, but are doing well to hold above the June low of $9.07. DTN's National Soybean Index closed at $8.85 Thursday, priced 61 cents below the November contract and holding above its lows in June.

Wheat:

December Chicago wheat was up 1 1/4 cents, once again starting the day with a hint of bargain-hunting. Prices have been beat down pretty hard the past seven weeks and Thursday's bounce may have been a sign that selling activity was finally wearing out. Commercial buying also appeared as winter wheat prices reached their lows for 2017. Hurricane Harvey is a serious threat for south Texas, but with winter wheat out of the fields and planting not yet ready to begin, the storm should have no significant impact on wheat prices. Meanwhile, the northwestern U.S. remains dry and favorable for remaining spring wheat harvest. Friday afternoon's CFTC data should show significant liquidation from noncommercial in K.C. wheat as of Aug. 22 and if so, that should also calm the selling in wheat. Both Chicago and K.C. wheat are near their lowest spot prices in 2017 and should be able to find support for a sideways trading range. DTN's National SRW index closed at $3.82 Thursday, priced 27 cents below the September contract and near its lowest price in three months.

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

FollowTodd on Twitter @ToddHultman1

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