DTN Closing Grain Comments

Corn, Wheat Drag Lower

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

General Comments:

Corn was down 1 1/2 cents in the December contract and down 3/4 cent in the July. Soybeans were down 1/2 cent in the November contract and down 1/2 cent in the July. Wheat closed down 4 3/4 cents in the December Chicago contract, down 5 1/4 cents in the December Kansas City, and down 3/4 cent in the December Minneapolis contract. The December U.S. dollar index is down 0.04 at 93.30. December gold is down $2.80 at $1,283.40 while December silver is down 3 cents and December copper is down $0.0200. The Dow Jones Industrial Average is up 161 at 23,158. November crude oil is up $0.16 at $52.04. November heating oil is down $0.0091 while November RBOB gasoline is up $0.0084 and November natural gas is down $0.101.

Corn:

December corn closed down 1 1/2 cents Wednesday on another day of low volume trade, while harvest has yet to reach the halfway mark. This week's warmer temperatures and drier conditions are helpful and are expected to last until at least the weekend when rains come to the Southern Plains, as far north as Missouri. The eastern Midwest may see some rain early next week, but the western Midwest is expected to stay drier. Wednesday morning, the U.S. Energy Department said last week's ethanol production jumped up from 967,000 to 1.019 million barrels a day, while ethanol inventory held steady at 21.5 million barrels. Technically, December corn has been doing well to hold a sideways range, thanks to commercial buying, but prices still struggle against a slow export pace and the anticipation of 14.28 billion bushels of new supplies this fall. December 2018 corn has a well-defined sideways range with a September high of $4.02 1/4 that will be interesting to keep an eye on this winter and early in 2018. DTN's National Corn Index closed at $3.06 Tuesday, priced 44 cents below the December contract and still holding above its August low. In outside markets, the December U.S. dollar index is down 0.04 and other commodities are mixed. The U.S. Census Bureau reported housing starts down 4.7% in September. Even with two major hurricanes, September's housing starts were still up 6.1% from a year ago.

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Soybeans:

November soybeans ended down a half-cent at $9.84 1/4 Wednesday, still offering some of its highest prices in over two months with everyone well aware USDA expects a record high 4.43 billion bushels of new supplies on the way, half of which are already harvested. This week's warmer temperatures and drier weather should give harvest progress a boost where fields are dry enough. The other part of the soybean equation that is difficult to predict is demand and, so far, it has been strong enough to keep prices in an uptrend in the midst of a record harvest. The main thing to know for now is that with dry weather continuing to be an ongoing concern in central Brazil, FOB soybean prices are 21 cents cheaper at the U.S. Gulf than at Brazil's ports, pointing to more U.S. export business ahead. Technically, the trend in November soybeans remains up -- an uncommon sight for this time of year. DTN's National Soybean Index closed at $9.07 Tuesday, priced 78 cents below the November contract and down from its highest price in over two months.

Wheat:

December Chicago wheat ended down 4 3/4 cents at $4.30, still above its lowest trade of $4.22 1/2 in August. The main problem for wheat prices continues to be USDA's estimate of record high world ending wheat stocks in 2017-18. This was supposed to be a season in which ending wheat supplies were trimmed by lower plantings, but production increases in Russia, Europe, and India ruined even those modest bullish hopes. Spring wheat prices proved profitable this year for those not afflicted by drought, but winter wheat prices continue to trade near their lowest spot prices in over ten years and we appear to be seeing reluctance toward planting this fall's winter wheat crops. Technically, Chicago wheat remains in a sideways range and has attracted interest from commercials in the low $4s, but a new low is possible while speculators show no motivation to buy. DTN's National SRW index closed at $3.96 Tuesday, priced 39 cents below the December contract and holding above its August low. DTN's National HRW index closed at $3.59, 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