DTN Closing Grain Comments

General Comments:

Corn closed up 3 3/4 cents in the December contract and up 3 1/4 cents in the July. Soybeans closed up 8 1/4 cents in the November and up 6 1/4 cents in the July. Wheat closed up 9 cents in the December Chicago, up 10 cents in the December Kansas City, and up 3 3/4 cents in the December Minneapolis.

The December U.S. dollar index is up 0.03 at 92.92. December gold is up $7.90 at $1,304.40 while December silver is up $0.12 and December copper is up 0.0105. The Dow Jones Industrial Average is up 44 at 22,885. November crude oil is up $0.44 at $51.04. November heating oil is up $0.213, November RBOB gasoline is up $0.0257, and November natural gas is up $0.021.

For the week:

December corn closed up 2 3/4 cents and July closed up 2 3/4 cents. November soybeans were up 28 cents while the July was up 26 3/4 cents. December Chicago wheat was down 4 cents, December Kansas City wheat was down 1/2 cent, and December Minneapolis wheat was down 8 3/4 cents.

Corn:

December corn closed up 3 3/4 cents Friday and was up 2 3/4 cents on the week, riding the coattails of a bullish rally in soybeans. Thursday's USDA estimates for corn were actually bearish with a 14.28 billion bushel harvest expected on a higher yield of 171.8 bushels an acre. 2.34 bb of ending U.S. corn stocks is a big surplus and will make it difficult for corn to rally to far, but does not negate the seasonal tendency for corn prices to move gradually higher from October until late May. Light showers fell in Iowa Friday and rain may interrupt harvest from Missouri to Michigan on Saturday, but the rest of the seven-day forecast looks favorable for harvest progress. Early Friday, USDA said last week's sales and shipments of corn totaled 62.7 million bushels and 26.4 mb respectively, a bearish combination for the week that put total corn shipments down 44% in 2017-18 from a year ago. Granted, the higher sales number is encouraging, but shipments are what count, and so far, Brazil continues to have the more favorable corn prices. Technically, the trend in December corn remains down, but Thursday's rejection of an attempted new low suggests that support is near. DTN's National Corn Index closed at $3.05 Thursday, priced 44 cents below the December contract and still holding above its August low. In outside markets, the December U.S. dollar index is up 0.03 after the U.S. Labor Department said consumer prices were up .5% in September and up 2.2% from a year ago. Core inflation was up just .1% in September, weakening the argument for another rate hike.

Soybeans:

November soybeans closed up 8 1/4 cents Friday and was up 28 cents on the week, thanks to Thursday's lower-than-expected 430 mb estimate of U.S. ending soybean stocks and simultaneous lack of increase in the crop estimate of 4.43 bb. USDA's World Supply and Demand report also estimated Brazil's ending soybean stocks in the current season at a lean 184 mb. For 2017-18, USDA is estimating Brazil's ending soybean stocks at just 90 mb, which makes central Brazil's early dry start even more interesting as any production shortfall down south will send more business to the U.S. Early Friday, USDA said last week's export sales and shipments of soybeans totaled 64.2 mb and 43.7 mb respectively, neutral amounts for the week that have total soybean shipments up 5% in 2017-18 from a year ago. With FOB soybean prices 23 cents cheaper at the U.S. Gulf, the active pace of U.S. exports is likely to continue. Technically, the trend remains up in November soybeans with a lot riding on the success of Brazil's next crop. DTN's National Soybean Index closed at $9.15 Thursday, priced 77 cents below the November contract and at its highest price in over two months.

Wheat:

December Chicago wheat closed up 9 cents Friday, but was down 4 cents on the week, pressured by favorable planting weather for U.S. winter wheat and USDA's higher-than-expected estimate of world ending wheat stocks, at 268.13 million metric tons or 9.85 bb for 2017-18. At least on Friday, Chicago wheat was able to let go of all the bearish gloom that had been pressuring prices lower in October and found support again from commercial buying just as prices were getting close to their 2017 low. With USDA estimating 960 mb of ending U.S. wheat stocks, the U.S. could use more exports, but that has proven difficult lately with bigger crops from Europe and Russia offering stiff competition. Early Friday, USDA said last week's export sales and shipments of wheat totaled 6.4 mb and 12.0 mb, bearish amounts for the week that have total wheat shipments down 3% in 2017-18 from a year ago. Technically, Chicago wheat prices are cheap enough to attract commercial interest and that is helping prices hold steady in a sideways trading range. DTN's National SRW index closed at $3.91 Thursday, priced 39 cents below the December contract and holding above its August low. DTN's National HRW index closed at $3.50, also above its August low.

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

Follow Todd Hultman on Twitter @ToddHultman1

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