DTN Closing Grain Comments

Soybeans Give It Back, Finish Lower

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

General Comments:

Corn was up 1/4 cent in the December contract and up 1/4 cent in the July. Soybeans were down 13 cents in the November contract and down 11 3/4 cents in the July. Wheat closed up 4 1/2 cents in the December Chicago contract, up 3 3/4 cents in the December Kansas City, and up 14 cents in the December Minneapolis contract. The December U.S. dollar index is up 0.50 at 92.47. December gold is up $15.10 at $1,312.60 while December silver is up 18 cents and December copper is down $0.0080. The Dow Jones Industrial Average is down 70 at 22,279. November crude oil is up $1.51 at $52.17. November heating oil is up $0.0395 while November RBOB gasoline is up $0.0403 and November natural gas is down $0.030.

Corn:

December corn ended down a quarter cent Monday, staying within a narrow, sideways range in the month of September as crops get closer to harvest time. Monday's weather map showed moderate to heavy rain amounts from the Texas Panhandle up to Nebraska and Iowa with heavier rain amounts expected in western Texas the next five days. The rest of the Corn Belt is anticipating mostly dry weather the next five days, favorable for harvest where crops are ready. On the demand side, USDA said 29.1 million bushels of corn were inspected for export last week, a bearish amount that has total inspections off to a slow start in 2017-18. Friday's CFTC data showed noncommercials bearish in corn with 38,025 net shorts as of Sep. 19. Commercials increased net longs to 18,850 contracts, finding attractive value in these lower corn prices for a third consecutive week. Technically, December corn remains in a downtrend, but has not seen a new low since Aug. 31, thanks to commercial support at this time of year when seasonal lows are typically made. DTN's National Corn Index closed at $3.08 Friday, priced 45 cents below the December contract and still up from its lowest price in 11 months. In outside markets, concerns about North Korea surfaced again, sending December gold up $15.10. The December U.S. dollar index is up 0.50 with new concerns for the euro after Germany's election.

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Soybeans:

November soybeans fell 13 cents Monday, taking back all but a half-cent of Friday's gain while this week's forecast anticipates better chances for rain in central Brazil. There is still time for planting down south, but the clock is ticking and it all depends again on cooperation from weather. Prices can get jumpy in these scenarios with forecasts changing, but so far Brazil's FOB soybean prices at port are up over 40 cents in September and 19 cents above similar prices at the U.S. Gulf. USDA said 37.8 million bushels of soybeans were inspected for export last week putting the new total for 2017-18 up 33% from a year ago, an early bullish start. Monday afternoon's Crop Progress report will be watched for harvest progress and the week ahead looks generally favorable, except for two days of rain in the western Plains. Friday's CFTC data showed noncommercials lightly bullish in soybeans with 20,124 net longs as of Sep. 19. Commercials trimmed net longs from 32,292 to 14,987, still offering support for soybean prices in the mid-$9s. In spite of Monday's sell-off, the trend in November soybeans remains up with commercials still actively supporting prices. DTN's National Soybean Index closed at $9.12 Friday, priced 73 cents below the November contract and at its highest close in seven weeks.

Wheat:

December Chicago wheat closed up 4 1/2 cents Monday with futures spreads indicating commercials are still interested in Chicago wheat at its highest prices in five weeks. Friday's CFTC data showed noncommercials still bearish in Chicago wheat with 30,379 net shorts as of Sep. 19 while commercials were net long 34,341 contracts -- an overall pattern that we have seen a lot since 2013. USDA will have an update of winter wheat planting progress on Monday afternoon and, so far, traders don't seem too concerned about this week's forecast for heavy rains in West Texas and surrounding areas. Technically, the trend in winter wheat has turned up, but fundamentally, plentiful wheat supplies remain a limiting factor. For spring wheat, December Minneapolis wheat was up 11 cents Monday, possibly finding support after two and a half months of falling prices. DTN's National SRW index closed at $4.06 Friday, priced 43 cents below the December contract and near its highest price in five weeks. DTN's National HRW index closed at $3.70, at its highest price in five weeks.

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

Follow Todd Hultman on Twitter @ToddHultman1

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Todd Hultman