DTN Closing Grain Comments

General Comments:

Corn was down 1 1/4 cents in the December contract and down 1 3/4 cents in the July. Soybeans were down 12 3/4 cents in the January contract and down 12 cents in the July. Wheat closed down 7 1/4 cents in the December Chicago contract, down 5 3/4 cents in the December Kansas City, and was down 14 1/4 cents in the December Minneapolis contract.

The December U.S. dollar index is up 0.11 at 94.39. December gold is up $5.10 at $1,279.30 while December silver is up 18 cents and December copper is up $0.0445. The Dow Jones Industrial Average is up 25 at 23,447. December crude oil is up $0.04 at $56.78. December heating oil is up $0.0025 while December RBOB gasoline is down $0.0156 and December natural gas is down $0.023.

Corn:

December corn ended down 1 1/4 cents Monday, keeping a low profile after last week's higher crop estimate from USDA and staying near its lowest prices in 2017. Monday afternoon's report of harvest progress from USDA is likely to be up from last week's 70%, but low prices and wet conditions in the Eastern Corn Belt will keep this year's pace slower than usual. This week's forecast is mostly dry the next few days with light amounts in the Eastern Corn Belt that increase to moderate amounts later this week. Adding to corn's bearish woes, the export pace remains slow in the early fifth of the new season. USDA said Monday morning that 14.8 million bushels of U.S. corn were inspected for export last week, a bearish amount that has total inspections down 45% in 2017-18 from a year ago. FOB prices are currently 11 cents cheaper at Brazil's ports that at the U.S. Gulf so the slow pace is expected to continue. Technically, the trend is down in December corn, but at these cheap prices, downside potential should be limited. The ongoing risk is that because of heavy excess supplies, commercials are corn's sole source of support. DTN's National Corn Index closed at $3.04 Friday, priced 40 cents below the December contract and is still defiantly holding above its August low. In outside markets, December gold is up $5.10 and December crude oil is up 4 cents a barrel. CFTC's Commitments of Traders report will be released later on Monday afternoon due to Veteran's Day.

Soybeans:

January soybeans dropped 12 3/4 cents Monday to $9.74 1/4, the lowest close in five weeks, showing bearish follow-through from Thursday's outside reversal. Thursday's USDA estimates for soybeans were neutral, but prices have come down lately, pressured by USDA's estimate of a record high corn yield and by beneficial rains across central Brazil the past seven days, including over the weekend. According to Dow Jones, the private consultant AgRural said 57% of Brazil's soybeans were planted as of last week, close to the five-year average. More rain will continue to be needed and this week's forecast is cooperating so far with moderate amounts expected over Brazil's main growing areas. In spite of cheaper U.S. soybean prices relative to Brazil's ports, U.S. soybean exports have disappointed expectations in early 2017-18. USDA said Monday that 76.7 million bushels of soybeans were inspected for export last week, a bearish amount that has total inspections down 12% in 2017-18 from a year ago. Earlier, USDA said 135,000 metric tons of U.S. soybean cake and meal was sold to Philippines for 2017-18. Technically, the trend remains up in January soybeans, but Thursday's reversal is potentially bearish and a close below $9.69 1/2, if it happened, would turn the trend lower. DTN's National Soybean Index closed at $9.07 Friday, priced 80 cents below the January contract and down from its highest price in over three months. 137 delivery intentions were reported for November soybeans early Monday and the November contract expires early Tuesday.

Wheat:

December Chicago wheat closed down 7 1/4 cents, as commercials took back last week's gain. The main problem for wheat prices is that it remains difficult to sustain a rally when so much supply is available. Even last week's lower estimate of 935 mb of U.S. ending stocks from USDA still represents 44% of annual use. Unfortunately for producers, U.S. wheat exports are struggling this year against abundant world supplies and Monday's inspections report offered no help for prices. USDA said 11.1 mb of wheat were inspected for export last week, putting total inspections down 6% in 2017-18 from a year ago. This week's forecast expects mild temperatures and mostly dry conditions across the southern U.S. Plains, which is favorable for anyone that still wants to plant winter wheat. Technically, the trend in Chicago wheat remains sideways, under bearish pressure from this winter's heavy supplies. DTN's National SRW index closed at $3.97 Friday, priced 34 cents below the December contract and still holding above its August low. DTN's National HRW index closed at $3.74, also holding stubbornly above its August low.

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

Follow Todd Hultman on Twitter @ToddHultman1

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