DTN Closing Grain Comments

Soybeans Fall Back, Corn Traders Start Early Weekend

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn closed up 1/2 cent in the December contract and up 1 cent in the July. Soybeans closed down 7 1/4 cents in the November and down 6 cents in the July. Wheat closed up 6 cents in the December Chicago, up 4 cents in the December Kansas City, and down 11 cents in the December Minneapolis. The December U.S. dollar index is down 0.20 at 91.69. December gold is up $3.90 at $1,325.40 while December silver is down $0.11 and December copper is down 0.0055. The Dow Jones Industrial Average is up 47 at 22,251. October crude oil is down $0.11 at $49.78. October heating oil is up $0.141, October RBOB gasoline is up $0.0349, and October natural gas is down $0.049.

For the week:

December corn closed down 2 cents and July closed down 1 cent. November soybeans were up 6 3/4 cents while the July was up 6 1/2 cents. December Chicago wheat was up 11 1/4 cents, December Kansas City wheat was up 4 1/2 cents, and December Minneapolis wheat was down 25 1/4 cents.

Corn:

December corn closed up a half-cent Friday on light volume, surviving Tuesday's bearish WASDE report with just a 2-cent loss on the week. Other than scattered showers falling across the western Plains, there was not a lot of news for corn on Friday, confirmed by the narrow trading range. There is rain in the seven-day forecast for the northern and central Plains, but more importantly, temperatures are expected to stay warm, which will help crops mature. With no major obstacles seen between now and harvest, the technical trend remains down for December corn. Seasonally speaking, this is the time of year when lows are typically made and, so far, prices are holding above the Aug. 31 low of $3.44 1/4. DTN's National Corn Index closed at $3.10 Thursday, priced 45 cents below the December contract and up from its lowest price in nine months. In outside markets, the December U.S. dollar index is down 0.20, staying near its lowest prices in over two years while December gold is up $3.90.

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Soybeans:

November soybeans closed down 7 1/4 cents Friday, but managed a 6 3/4 cent gain in a week that included a bearish 4.43 billion bushel crop estimate from USDA. Prices showed no significant response to Friday's bullish crush statistics from the National Oilseed Processors Association (NOPA). NOPA said 142.4 million bushels of soybeans were crushed in August, more than expected and up 8% from a year ago. The report also suggests USDA has room for a slight reduction in its U.S. estimate of old-crop ending soybean stocks. While there is still plenty of uncertainty about the size of the U.S. soybean crop, Brazil's planting season is off to a dry start with no help seen yet in next week's forecast. On the demand side, FOB soybean prices remain a dime cheaper at the U.S. Gulf than at Brazil, so U.S. export prospects continue to look good. Early Friday, USDA said China bought 4.85 million bushels (132,000 mt) of U.S. soybeans for 2017-18 -- the sixth soybean sale announced in six trading sessions. Seasonally speaking, it is early for November soybean prices to be turning higher, but the weekly trend remains up with active commercial buying helping to support prices in the mid $9s. DTN's National Soybean Index closed at $9.09 Thursday, priced 67 cents below the November contract and at its highest close in over six weeks.

Wheat:

December Chicago wheat closed up 6 cents Friday and was up 11 1/4 cents on the week, benefiting from a bullish outside reversal made on Tuesday, the same day as USDA's WASDE report. As mentioned earlier Friday, wheat's bullish reversal doesn't mean prices are headed back to $5.50, but it is another clue that the downtrend is likely spent and prices are cheap enough to find support for a sideways trading range as we head toward a quieter time of year. Central Kansas is dry at the start of planting season and the area did see scattered showers Friday. However, most of the southwestern Plains are expected to be dry the next five days with the best rain chances favoring eastern Kansas, Missouri, and Illinois. Technically, winter wheat prices are levelling out with commercials providing support in Chicago wheat. However, with world ending wheat stocks high, there are no bullish arguments at this time. December Minneapolis wheat fell 11 cents to its lowest close in three months as noncommercials continue to liquidate long positions after this summer's drought. DTN's National SRW index closed at $4.00 Thursday, priced 43 cents below the December contract and near its highest price in a month. DTN's National HRW index closed at $3.61, near its highest price in a month.

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

Follow Todd on Twitter @ToddHultman1

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Todd Hultman