DTN Early Word Grains
Back to the Grind
December corn was 1 cent lower, January soybeans were 2 cents lower, and December Chicago (SRW) wheat was 5 cents lower.
CME Globex Recap:Another early Monday morning finds the grain and oilseed complex grinding lower again, this time with a bit more enthusiasm. Corn and soybeans were more than a penny lower, as opposed to the usual fractions in corn, while wheat contracts were down about a nickel. Other commodity sectors were mostly higher with gold showing a solid gain and crude oil pennies higher. The U.S. dollar index rallied while DJIA futures came under pressure again from overseas equities.
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The Dow Jones Industrial Average closed 39.73 points (0.2%) lower at 23,422.21, the NASDAQ Composite gained 0.89 point to 6,750.94, and the S&P 500 dipped 2.32 points (0.1%) to 2,582.30 Friday. DJIA futures were 35 points lower early Monday morning. Asian markets closed mostly lower with Japan's Nikkei 225 down 300.43 points (1.3%), Hong Kong's Hang Seng adding 61.26 points (0.2%), and China's Shanghai Composite up 15.16 points (0.4%). European markets were trading mostly lower with London's FTSE 100 up 9.66 points (0.1%), Germany's DAX off 35.63 points (0.3%), and France's CAC 40 losing 19.41 points (0.4%). The euro was 0.0018 lower at 1.1647 while the U.S. dollar index gained 0.16 to 94.55. December 30-year T-Bonds were 16/32 higher at 152'26 while December gold rallied $4.80 to $1,279.00. Crude oil was $0.03 higher at $56.77 while Brent crude dipped $0.07 to $63.45. China's Dalian soybean futures were mixed and Malaysian palm oil futures were lower overnight.
| BULL | BEAR | ||
| 1) | National average corn basis firmed last week, keeping the trend of the DTN National Corn Index sideways as opposed to the downtrend in futures. | 1) | Downtrends on corn's weekly (intermediate-term) and monthly (long-term) charts gained strength last week. |
| 2) | Soybeans did not establish a new 4-week low last week, maintaining the sideways trend on weekly charts. | 2) | A large bearish vacuum looks to have developed underneath the January soybean contract, just waiting for a new 4-week low to occur. |
| 3) | Minneapolis spring wheat continues to show an uptrend on weekly charts, supported by buying from both commercial and noncommercial traders. | 3) | Forward curves for both Chicago and Kansas City wheat remain bearish long-term. |
The weekly Newsom on the Market column can be found on subscription sites only. On DTN Pro it is in News/Town Hall and on MyDTN in News/Columns.
MORE COMMODITY-SPECIFIC COMMENTSCORN There isn't much new to say about corn Monday morning as the market shows quiet losses across the board. Weekly export inspection numbers released later in the morning aren't expected to generate much excitement, and neither are weekly crop progress estimates Monday afternoon. The former is expected to show this year's pace still trailing last year while the latter could have harvest at least 75% to 80% completed. National average basis firmed last week, but remains weaker than normal due to the amount of old-crop and freshly harvested new-crop supplies on hand. Monday afternoon will also see the release of last Friday's weekly CFTC Commitments of Traders report, delayed due to the Veterans Day Holiday, with light covering of the existing net-short futures position possible. Of course, this would be through Tuesday, November 7, with selling gaining momentum later in the week.
SOYBEANS The soybean market was under light pressure overnight with contracts showing small losses. As discussed in DTN's Technically Speaking blog over the weekend, January soybeans continue to threaten a move to a new 4-week low below $9.81. The contract's daily chart continues to show a sideways pattern. Fundamentally there is little to get excited about with weekly export inspections expected to be solid again Monday morning, while Monday afternoon's round of crop progress guesses from NASS should show harvest nearly completed. National average basis firmed last week while the carry in the nearby January-to-March futures spread strengthened. Combined, these two fundamental factors would indicate commercial traders are comfortable sourcing supplies to meet demand at this time. Delivery of 137 contracts was reported against the November issue, putting the total at 813 contracts.
WHEAT Selling was consistent overnight in the wheat complex with contracts of all three markets down about 5 cents. Fundamentally there is little fresh news, with Monday morning's weekly export inspections expected to be neutral-to-bearish while the afternoon's round of guess the percent planted without knowing how many acres are seeded should show winter wheat planting nearly completed. Technically wheat is a mix of signals with the most consistent being the uptrend in Minneapolis spring wheat, supported by buying from both commercial and noncommercial traders.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.04 | $0.02 | -$0.40 | Dec | $0.003 |
| Soybeans: | $9.07 | $0.03 | -$0.80 | Jan | $0.008 |
| SRW Wheat: | $3.97 | $0.03 | -$0.34 | Dec | $0.001 |
| HRW Wheat: | $3.74 | $0.03 | -$0.60 | Dec | -$0.009 |
| HRS Wheat: | $6.19 | $0.00 | -$0.29 | Dec | $0.004 |
Darin Newsom can be reached at darin.newsom@dtn.com
Darin can be followed throughout the day at www.twitter.com\DarinNewsom
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