DTN Closing Grain Comments

General Comments:

Corn was up 2 3/4 cents in the September contract and up 2 1/2 cents in the December. Soybeans were up 4 cents in the September contract and up 2 1/2 cents in the November. Wheat closed up 2 3/4 cents in the December Chicago contract, up 3 3/4 cents in the December Kansas City, and up 15 1/2 cents in the December Minneapolis contract. The September U.S. dollar index is down 0.04 at 92.19. December gold is down $6.20 at $1,338.30 while December silver is down 1 cent and December copper is up $0.0310. The Dow Jones Industrial Average is up 82 at 21,835. October crude oil is up $0.45 at $49.11. October heating oil is up $0.0045 while October RBOB gasoline is down $0.0314 and October natural gas is up $0.035.

Corn:

December corn closed up 2 1/2 cents Wednesday, maintaining last Thursday's more bullish tone with help from USDA. Late Tuesday, USDA said 60% of corn was dented and 12% was considered mature, both down from five-year averages of 68% and 18%, respectively. The slow development pace remains a potential concern for crops in the northern states, but there is no significant freeze expected in the seven-day forecast yet. The good-to-excellent rating dropped one point to 61% and took DTN's Corn Condition Index down five points to 144, still the lowest in four years. As Senior Analyst Darin Newsom quickly pointed out much of the decline could be attributed to the normal browning process that happens as corn matures. Corn prices were also helped slightly by USDA's news that Mexico bought 10.0 million bushels (253,300 mt) of U.S. corn for 2017-18 -- a not-so-subtle reminder of the benefits of a good trading partner while NAFTA negotiations are taking place. The seven-day forecast is mostly dry across the Midwest with cooler, but not freezing temperatures prevailing. Hurricane Irma is the next major threat and is headed to the South Atlantic coast, but has more potential impact on cotton prices than corn. Technically, the trend in December corn remains down, but last Thursday's rebound remains a candidate for this year's seasonal low. DTN's National Corn Index closed at $3.12 Tuesday, priced 47 cents below the December contract and up from its lowest price in nine months. There were 215 deliveries for September corn early Wednesday. In outside markets, the September U.S. dollar index remains quiet, trading down 0.04 and still hovering near its lowest prices in over two years while December gold is down $6.20 and October crude oil is up 0.45.

Soybeans:

November soybeans closed up 2 1/2 cents, quietly continuing to work higher with commercials providing unusually active support for prices at a time of year that is usually bearish and focused on the upcoming harvest. Speaking of harvest, USDA said late Tuesday that 97% of soybeans had reached pod setting and 11% were dropping leaves, in line with their usual paces. Sixty-one percent of the crop was rated good-to-excellent, the same as a week ago. Some parts of nearly every producing state would probably like to have seen more rain in August, but the seven-day forecast is mostly dry as crops are now maturing in the field. It remains impressive that even though soybean prices were hit with a record crop from Brazil earlier this year and may see another record U.S. harvest this fall, they are now turning higher at a time when commercials would normally sit back and wait for lower prices at harvest. Instead, we see commercials actively involved in the long side of soybeans and soybean meal -- bullish market clues for soybean prices. DTN's National Soybean Index closed at $9.04 Tuesday, priced 65 cents below the November contract and its highest close in three weeks. Among September contracts, Wednesday morning's delivery intentions totaled 73 for soybeans, 169 for soybean meal, and 446 for soybean oil.

Wheat

December Chicago wheat closed up 2 3/4 cents, continuing to rebound modestly from last week's low after nearly two months of constant selling. The recent popularity of the September contract fell back 8 3/4 cents Wednesday with the announcement of 143 deliveries, but thanks to Friday's CFTC data, we still know commercials are interested in the long side of Chicago wheat at these prices near the lower $4s. Late Tuesday, USDA said spring wheat harvest was 89% complete while smoke and wildfires continue to pester the northwestern U.S. Winter wheat planting will be starting soon in the southwestern Plains. While DTN's national index of cash HRW wheat prices is over 60 cents a bushel higher than it was a year ago, it is still not high enough to encourage expanded wheat acres this fall. That, plus increased commercial attention, should help wheat prices find support and the August low of $4.22 1/2 in the December contract is a prime candidate for support for the rest of 2017. DTN's National SRW index closed at $3.98 Tuesday, priced 45 cents below the December contract and up from its lowest price in four months. DTN's National HRW index closed at $3.60, up from its lowest price in four months. Among September wheat contracts, delivery intentions totaled 143 for Chicago and 159 for K.C. early Wednesday.

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

Follow Todd on Twitter @ToddHultman1

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