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 unknown destinations for 2017-18. Earlier Tuesday, corn and soybeans were slightly lower, anticipating the release of USDA's next WASDE estimates at 11 a.m. CDT. The remaining showers of Irma are falling around the lower Mississippi river and mid-Atlantic states.

Other Markets:

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

Corn:

December corn was down 1 1/4 cents early Tuesday, ahead of USDA's next round of monthly supply and demand estimates, due out at 11 a.m. CDT. Dow Jones' analyst survey expects a small reduction in the yield estimate to keep the crop estimate near 14 billion bushels, but like some storms of late, you never know just how much punch they might pack until they make landfall and traders seem understandably cautious ahead of this one. The only rain near corn on Tuesday's weather map is a line of showers along the lower Mississippi and Ohio rivers. The best chances for rain the next five days are from Montana to Minnesota while the rest of the Midwest stays mostly dry and warm. Late Monday, USDA said 21% of corn crop were mature, down from the five-year average of 31% so the outlook for warm temperatures is important and favorable for crops. We continue to wonder if the Aug. 31 low of $3.44 1/4 in December corn will stand as the seasonal low. Although early, it is cheap enough. Looking forward, it is difficult to see a motivating argument for buyers -- unless USDA finds this fall's crop is smaller than expected. For now, December corn remains in a downtrend. DTN's National Corn Index closed at $3.13 Monday, priced 45 cents below the December contract and up from its lowest price in nine months. There were no deliveries of September corn early Tuesday. In outside markets, the September U.S. dollar index is up 0.12 and most outside commodities are lower.

Soybeans:

At 8 a.m. CDT, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to unknown destinations for 2017-18. Earlier, November soybeans were down 3/4 cent, keeping a low profile ahead of USDA's 11 a.m. CDT report. Dow Jones' survey expects USDA to estimate a record high 4.32 billion bushel soybean crop with a yield of 48.7 bushels an acre. USDA's 90% confidence interval on Tuesday's soybean crop estimate is plus or minus 9% so there is still plenty of room for argument with Tuesday's number. One valid concern that bulls will point out are the dry conditions in parts of Iowa and Illinois. Late Monday, USDA said 22% of soybeans were dropping leaves, close to their usual pace. 60% of the crop was said to be good-to-excellent, down from 61% last week. Tuesday's report has a chance to disrupt prices, but so far, the trend in November soybeans is up with active commercial participation supporting prices. DTN's National Soybean Index closed at $8.95 Monday, priced 65 cents below the November contract and near its highest prices in four weeks. Among September contracts, delivery intentions totaled 128 for soybean meal, 356 for soybean oil, and there were none for soybeans early Tuesday.

Wheat:

December Chicago wheat was up 1 1/4 cents early, starting to show signs of holding a sideways range as prices head into the final months of the year. Late Monday, USDA said 95% of spring wheat was harvested and 5% of the new winter wheat crop was planted, highlighting the transition to a new season. Dow Jones' survey of analysts is hoping Tuesday's WASDE report will show a slight reduction in USDA's estimate of world ending wheat stocks, but even if there is, wheat prices are not likely to show much reaction. With the forecast looking generally favorable for planting the next winter wheat crop, winter wheat prices remain in a downtrend, but have likely gotten cheap enough to find support for the rest of 2017. DTN's National SRW index closed at $3.89 Monday, priced 46 cents below the December contract and up from its lowest prices in four months. Among September wheat contracts, delivery intentions totaled 7 for Chicago, 42 for K.C., and 1 for Minneapolis early Tuesday. 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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