DTN Closing Grain Comments

Grains Sag in Listless Trade

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

General Comments:

Corn was down 1/2 cent in the December contract and down 1 1/4 cents in the July. Soybeans were down 6 1/4 cents in the November contract and down 5 1/2 cents in the July. Wheat closed down 1 3/4 cents in the December Chicago contract, down 1/2 cent in the December Kansas City, and up 1 1/2 cents in the December Minneapolis contract. The December U.S. dollar index is up 0.22 at 93.38. December gold is down $15.60 at $1,287.40 while December silver is down 32 cents and December copper is down $0.0420. The Dow Jones Industrial Average is up 22 at 22,979. November crude oil is down $0.13 at $51.74. November heating oil is down $0.0086 while November RBOB gasoline is up $0.0057 and November natural gas is up $0.025.

Corn:

December corn closed down a half-cent Tuesday, holding roughly steady in its same sideways range of the past six weeks as the 2017 harvest makes slow progress. USDA said late Monday that 90% of corn was mature and 28% was harvested, down from its five-year average of 47%. Harvest progress was still in single digits in Minnesota, North Dakota and Wisconsin, but should pick up the next five days with warm temperatures and mostly dry weather expected. Corn exports have been tougher to come by since South America's big crops showed up, but early Tuesday, USDA said Mexico bought 4.5 million bushels (115,000 metric tons) of U.S. corn and another 5.7 million bushels (146,000 mt) were sold to unknown destinations, both for 2017-18. With a 14.28 billion bushel U.S. corn crop on the way, December corn remains under bearish pressure, but has found recent support from commercials in the mid-$3s. DTN's National Corn Index closed at $3.06 Monday, 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 0.22 and December gold is down $15.60 with anticipation that President Donald Trump may select a Federal Reserve Chairman that is more aggressive in raising interest rates.

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Soybeans:

November soybeans fell a second day, this time 6 1/4 cents lower on light volume and not much news happening. USDA said late Monday that 49% of soybeans were harvested, down from the five-year average of 60%. Iowa and Nebraska were 32% and 33% harvested, respectively, about half their usual progress, slowed by wetter fall conditions that are expected to get a better break this week. It remains out of the ordinary that soybeans prices are trading near their highest levels in over two months while a record-high 4.43 billion bushel U.S. soybean crop is being harvested, but as we step back and look around the world, we see USDA only expecting Brazil to start the new season with 184 million bushels of soybeans. That means that Brazil has to come up with another big crop in the new season to avoid a shortfall in 2017-18 and, as DTN has been reporting, the new planting season has been dry in central Brazil. Currently, the trend in November soybeans remains up with a wide range of price potential riding on the success of Brazil's next crop. DTN's National Soybean Index closed at $9.14 Monday, priced 77 cents below the November contract and down from its highest price in over two months.

Wheat:

December Chicago wheat ended down 1 3/4 cents Tuesday, staying in its sideways range of the past two months with no bullish arguments to inspire potential buyers. USDA said 60% of winter wheat has been planted, down from the five-year average of 71%. Kansas is only 42% planted, far below its usual pace. Without an excuse of bad weather, we are left to assume that producers are still looking for alternatives and wheat plantings are likely to be down again. That may offer some support to wheat prices in the spring, but getting prices to move from now until spring of 2018 will be a tough task with USDA predicting record ending wheat supplies in 2017-18. Technically, winter wheat prices remain in a sideways range with Chicago wheat enjoying commercial support in the low $4s. DTN's National SRW index closed at $3.97 Friday, priced 39 cents below the December contract and holding above its August low. DTN's National HRW index closed at $3.59 and is also holding above its August low.

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

Follow Todd Hultman on Twitter @ToddHultman1

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Todd Hultman