DTN Closing Grain Comments

Soybeans Start New Month With Modest Gain

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

General Comments:

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

The December U.S. dollar index is up 0.28 at 94.70. December gold is up $4.70 at $1,275.10 while December silver is up 40 cents and December copper is up $0.0395. The Dow Jones Industrial Average is up 52 at 23,429. December crude oil is down $0.21 at $54.17. December heating oil is down $0.0220 while December RBOB gasoline is up $0.0113 and December natural gas is down $0.006.

Corn:

December corn closed up 2 1/2 cents at $3.48 1/4 Wednesday, helped by the re-appearance of commercial buying just as prices were getting back near their 2017 lows. It also helped that other commodity markets were also mostly higher as signs of an improving world economy continue to trickle in. Wednesday's weather map showed snow from Montana to Michigan and early snow mixed with rain around the Ohio River Valley. The eastern Midwest is expected to be bothered by wet conditions in the week ahead, but the rest of the Corn Belt should see decent harvest progress. Technically, December corn continues to trade within a sideways range and rallies have been difficult to come by while the crop size is still being guessed at and U.S. exports have been slow. DTN's National Corn Index closed at $3.03 Tuesday, priced 42 cents below the December contract and is still holding above its August low. In outside markets, the December U.S. dollar index was up 0.28 after the Federal Reserve kept interest rates unchanged, as expected, but also noted increased economic activity in spite of two major hurricanes.

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Soybeans:

January soybeans closed up 6 1/2 cents at $9.91 1/4, aided by commercial buying and also joined by higher closes in meal and oil. The recent bullishness in soybeans seems to be coming from Brazil where earlier this week, Brazil's FOB soybean prices reached their highest premiums to the U.S. Gulf since December 2016. Wednesday's trading showed U.S. prices still 25 cents below Brazil's ports as rain in central Brazil has been light so far, in spite of forecasts for more in the week ahead. Here in the U.S., there are still soybeans to bring in and, as mentioned above, that may be tougher in the eastern Midwest where Wednesday's rain is expected to be followed by more later this week. Technically, the trend in January soybeans remains up with the steady flow of soybean supplies depending on another big crop from Brazil. DTN's National Soybean Index closed at $8.95 Tuesday, priced 89 cents below the January contract and down from its highest price in over two months. 47 delivery intentions were reported for November soybeans early Wednesday.

Wheat

December Chicago wheat ended down a half-cent at $4.18, still down in the dumps after Tuesday's new contract low and finding no arguments to motivate buying among traders. Commercial buyers will likely continue to support wheat prices at these cheap levels, but futures premiums continue to erode over time while cash wheat prices are holding roughly steady. The southwestern U.S. Plains are windy on Wednesday, but overall, conditions should be favorable enough for anyone that wants to plant in the week ahead. Among spring wheat prices, December Minneapolis wheat was up 1 1/4 cents at $6.14. Prices appear to be levelling out after a three-month decline as noncommercial net longs have fallen to 2,260 as of Oct. 24. Winter wheat prices remain under bearish pressure with plenty of excess wheat supplies projected for 2017-18 and little threat likely to emerge before early 2018. DTN's National SRW index closed at $3.84 Tuesday, priced 35 cents below the December contract and still holding above its August low. DTN's National HRW index closed at $3.49, 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