DTN Before The Bell Grain Comments

USDA Announces Corn, Wheat and Sorghum Sales

Todd Hultman
By  Todd Hultman , DTN Grains Analyst
Connect with Todd:
(DTN photo by Greg Horstmeier)

Morning CME Globex Update:

At 8 a.m. CDT, USDA announced 5.3 million bushels (135,000 mt) of U.S. corn were sold to Korea and 4.0 million bushels (102,400 mt) were sold to Mexico, both for 2017-18. Also, 11.0 million bushels (300,000 mt) of U.S. HRW wheat were sold to Iraq for and 9.9 million bushels (251,000 mt) of sorghum were sold to unknown destinations, both for 2017-18. Earlier, December corn and January soybeans were starting a little lower Friday, but still have a chance at small positive gains for the week.

Other Markets:

Dow Jones: Higher
U.S. Dollar Index: Lower
Gold: Higher
Crude Oil: Higher

P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]

Corn:

At 8 a.m. CDT, USDA announced 5.3 million bushels (135,000 mt) of U.S. corn were sold to Korea and 4.0 million bushels (102,400 mt) were sold to Mexico, both for 2017-18. Earlier, December corn was down 1/4 cent, still showing a slight gain for the week, but staying well within the same sideways range prices have been in for two months. Snow is falling in Montana and the Dakotas early Friday with more expected in the northern Plains over the weekend. The bigger nuisance for this year's corn harvest has been wet weather in the eastern Midwest and more rain is expected the next few days, possibly into early next week. So far, none of those problems have affected the price of corn, but harvest difficulty may also be one of the reasons corn has not traded lower. Technically, the trend in December corn remains sideways in spite of a bearish fundamental outlook and prices have received help from a gradual build of commercial net longs. DTN's National Corn Index closed at $3.09 Thursday, priced 41 cents below the December contract and is still holding above its August low. In outside markets, the December U.S. dollar index is down 0.13 after the U.S. Labor Department said nonfarm payrolls increased 261,000 in October, less than was expected. The U.S. unemployment rate fell from 4.2% in September to 4.1% in October.

Soybeans:

January soybeans were down 3 1/4 cents early, but were still holding a modest gain for the week. As is typical, the U.S. soybean harvest is much farther along than corn, but unharvested fields in the eastern Midwest are more vulnerable to loss, trapped by this late stretch of wet weather. At the same time, central Brazil received some rain this week, but the region could still use more. More rain is promised in the weekly forecast, but FOB prices at Brazil's ports remain 25 cents higher than at the U.S. Gulf -- a sign of concern for Brazil's crops that should help U.S. exports stay active. Technically, the trend remains up for soybeans, but with world demand staying strong, all eyes are on Brazil's weather and the condition of the next crop. DTN's National Soybean Index closed at $9.15 Thursday, priced 85 cents below the January contract and down from its highest price in over two months. 49 delivery intentions were reported for November soybeans early Friday.

Wheat:

At 8 a.m. CDT, USDA announced 11.0 million bushels (300,000 mt) of U.S. HRW wheat were sold to Iraq for 2017-18. Before the announcement, December Chicago wheat was up 1 1/2 cents, trying to break even on the week after an earlier attempt at new lows. That doesn't mean all of wheat's bearish concerns are over, but it is a reminder that commercials have some interest at these lower prices in spite of wheat's heavy supplies and slow export pace. The forecast remains mostly dry for the southwestern U.S. Plains the next seven days while rain is expected in the eastern Midwest. With winter wheat supplies plentiful in the U.S. and around the world, it is not likely that exports will be able to help U.S. wheat prices this winter and that is going to keep downward, bearish pressure on prices. Unless some surprise emerges, the future path for winter wheat prices through the winter months is likely sideways to lower. DTN's National SRW index closed at $3.91 Thursday, priced 35 cents below the December contract and holding above its August low.

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

Follow Todd Hultman on Twitter @ToddHultman1

(BAS)

P[L2] D[728x90] M[320x50] OOP[F] ADUNIT[] T[]
P[R1] D[300x250] M[300x250] OOP[F] ADUNIT[] T[]
P[R2] D[300x250] M[320x50] OOP[F] ADUNIT[] T[]
DIM[1x3] LBL[] SEL[] IDX[] TMPL[standalone] T[]
P[R3] D[300x250] M[0x0] OOP[F] ADUNIT[] T[]

Todd Hultman