DTN Closing Grain Comments

General Comments:

Corn was down 1 1/2 cents in the December contract and down 2 cents in the July. Soybeans were down 6 cents in the November contract and down 5 3/4 cents in the July. Wheat closed down 6 1/2 cents in the December Chicago contract, down 6 cents in the December Kansas City and down 4 3/4 cents in the December Minneapolis contract.

The December U.S. dollar index is down 0.21 at 92.96. December gold is up $2.50 at $1,290.30 while December silver is up 6 cents and December copper is up $0.0485. The Dow Jones Industrial Average is up 44 at 22,385. November crude oil is down 0.64 at $51.50. November heating oil is down $0.0201 while November RBOB gasoline is down $0.0071 and November natural gas is down $0.038.

Corn:

December corn closed down 1 1/2 cents Thursday, another day of quiet, low volume trading ahead of Friday's report of Sept. 1 U.S. corn stocks. Most are expecting a number close to the September WASDE estimate of 2.35 billion bushels and anything significantly lower seems highly unlikely. If the guesses are true, it will be the highest amount of U.S. ending corn stocks in 30 years, representing 16% of annual use. Adding to corn's bearish supply woes, export demand has slowed dramatically since South America's big harvests showed up earlier this summer. Early Thursday, USDA said last week's sales and shipments of corn totaled 12.6 and 28.6 million bushels respectively, a bearish combination for the week with Mexico tagged as the largest buyer. Total corn shipments are now down 47% in 2017-18 from a year ago. USDA later said 9.2 million bushels (233,800 metric tons) of U.S. corn were sold to unknown destinations for 2017-18. Technically, December corn remains in a downtrend as traders anticipate more large piles of corn stacked up again this fall. On the other hand, this is the time of year when seasonal lows are typically made and so far, prices have stayed above the Aug. 31 low of $3.44 1/4. DTN's National Corn Index closed at $3.09 Wednesday, priced 45 cents below the December contract and still up from its lowest price in 11 months. In outside markets, the December U.S. dollar index is down 0.21, even after the U.S. Commerce Department said real GDP was up 2.2% in the second quarter from a year ago, slightly more than expected reported RTTNews.com.

Soybeans:

November soybeans closed down 6 cents Thursday, still pressured by the anticipation of beneficial rains in central Brazil this week. Conditions remain on the dry side so far, but it is that time of year when changing forecasts become important again to soybean prices. Early Thursday, USDA said last week's sales and shipments of soybeans totaled 109.6 mb and 36.2 mb respectively, bullish amounts which have total soybean shipments off to a good start, up 28% in 2017-18 from a year ago. Later, USDA said 4.85 mb (132,000 mt) of U.S. soybeans were sold to unknown destinations for 2017-18 -- the 12th sale in fifteen sessions. As FOB soybean prices are 25 cents cheaper at the U.S. Gulf than at Brazil's ports, the active pace of U.S. business should continue. If Dow Jones' survey is correct, Sept. 1 U.S. soybean stocks will come in at 339 mb Friday, the highest in 10 years. Technically, the trend in November soybeans remains up with resistance at $9.90 and active commercial support in the low to mid $9s. DTN's National Soybean Index closed at $8.90 Wednesday, priced 76 cents below the November contract and down from its highest price in seven weeks.

Wheat:

December Chicago wheat closed down 6 1/2 cents Thursday on light volume as the buying excitement that took prices to a new six-week high on Wednesday disappeared. As mentioned before, even though prices hit new highs, there is no strong fundamental case for trading significantly higher, and a sideways range seems more likely the next several months. Early Thursday, USDA said last week's export sales and shipments of wheat totaled 16.0 and 15.6 million bushels respectively, a bearish combination for the week that is not making a dent in USDA's U.S. ending stocks estimate of 933 mb. Dow Jones' pre-report survey expects 2.22 bb of U.S. wheat stocks on hand as of Sept. 1 and all wheat production of 1.725 bb for 2017. Unless USDA is holding a surprise, it does not seem likely that prices will have much to react to on Friday. Rain is falling in Colorado, Oklahoma and Texas Thursday with more expected in Texas the next couple days. The planting pace in Kansas has been slower than usual, and it is fair to wonder if producers are considering options other than wheat again this year. Technically, the trends in both, Chicago and K.C. wheat have turned higher, but sideways trading ranges seem more likely ahead. DTN's National SRW index closed at $4.18 Wednesday, priced 44 cents below the December contract and at its highest price in six weeks. DTN's National HRW index closed at $3.82, also its highest price in six weeks.

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

Follow Todd Hultman on Twitter @ToddHultman1

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