DTN Before The Bell Grain Comments

Morning CME Globex Update:

At 8 a.m. CDT, USDA announced 12.9 million bushels (352,000 mt) of soybeans were sold to unknown destinations for 2017-18. Earlier, corn and wheat were a little lower while soybeans were a little higher after a quiet weekend of warm and mostly dry weather across the Midwest. Tropical Storm Irma is currently causing problems in northern Florida and moving toward Georgia and Alabama.

Other Markets:

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

Corn:

December corn was down 1 1/2 cents early Monday after a quiet weekend of mostly dry weather and warm temperatures across the Corn Belt. In the Southeast, Hurricane Irma left behind serious damage in southern Florida and has now been downgraded to Tropical Storm in northern Florida, headed to Georgia and Alabama. The Corn Belt is expected to stay mostly dry and warm the next five days with the best rain chances in Montana and North Dakota. Friday's CFTC data showed noncommercials turned slightly bearish in corn, holding 14,000 net shorts as of Sep. 5. Commercials were also net short 5,432 contracts, still not eager to go long corn ahead of harvest. Tuesday's WASDE report may show a slightly lower yield estimate for corn, but Dow Jones' survey of analysts still expects a 14 billion bushel crop estimate (see DTN's Report Preview by Senior Analyst Darin Newsom, "Horseshoes and Hand Grenades"). Technically, the trend in December corn remains down, but the August low of $3.44 1/4 still has a chance to be this year's seasonal low. DTN's National Corn Index closed at $3.11 Friday, priced 45 cents below the December contract and up from its lowest price in nine months. There were 2 deliveries of September corn early Monday. In outside markets, the September U.S. dollar index is up 0.35 and stock market futures are trading higher, possibly showing a little relief that Irma's damage was not worse.

Soybeans:

At 8 a.m. CDT, USDA announced 12.9 million bushels (352,000 mt) of soybeans were sold to unknown destinations for 2017-18. November soybeans were up 1 1/2 cents early Monday, helped by a modest gain in soybean oil after spot palm oil prices closed at a new three-month high earlier Monday. Monday's weather map is mostly dry across the Midwest with warm temperatures as it was all weekend and is expected to stay much the same this week with chances for moderate showers in North Dakota. Tuesday's WASDE report is not expected to show much change in the soybean crop estimate with Dow Jones' survey looking for 4.32 billion bushels -- a new record high, if it proves out. Friday's CFTC data showed noncommercials roughly neutral toward soybeans with 2,044 net shorts as of Sep. 5. Commercials reduced net longs from 49,981 to 32,300, but still found values attractive. In spite of expectations for another record soybean harvest, November soybeans continue to show active support from commercials and that is helping prices trade above their August lows. DTN's National Soybean Index closed at $8.98 Friday, priced 64 cents below the November contract and near its highest prices in four weeks. Among September contracts, delivery intentions totaled 75 for soybean meal and 399 for soybean oil early Monday.

Wheat:

December Chicago wheat was down 4 cents early, staying close to its August lows with no strong bullish argument to help prices at this time of year. It is also likely that traders are cautious ahead of Tuesday's WASDE report as another increased estimate of world production is always possible. Friday's CFTC data showed noncommercials moderately bearish in Chicago wheat with 36,031 net shorts as of Sep. 5. Commercials increased net longs to 39,611, finding value in wheat's lower prices. Problems of smoke and wildfires in the northeastern U.S. are showing some improvement and will be helped this week by chances for moderate showers in Montana and North Dakota. The southwestern Plains will remain mostly dry with winter wheat planting about to begin. While the trend remains down for winter wheat, prices do appear to be finding support near their lowest spot prices this year. DTN's National SRW index closed at $3.93 Friday, priced 45 cents below the December contract and up from its lowest prices in four months. Among September wheat contracts, delivery intentions totaled 4 for Chicago, 7 for K.C., and 14 for Minneapolis early Monday. September grain futures expire early on Thursday, Sep. 14.

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

FollowTodd on Twitter @ToddHultman1

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