DTN Early Word Grains

By Darin Newsom
DTN Senior Analyst

6:00 a.m. CME Globex:

December corn was fractionally higher, January soybeans were 4 cents higher, and December Kansas City (HRW) was 2 cents higher.

CME Globex Recap:

The grain and oilseed complex was in the green early this morning of Thanksgiving Day Eve. Soybeans led the way, posting a modest rally after failing to climb above unchanged Tuesday. Corn and wheat were fractionally higher. Outside commodities were mostly higher led by strong gains in crude oil. The U.S. dollar index was lower and DJIA futures were higher again early Wednesday.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 160.50 points (0.7%) higher at 23,590.83, the NASDAQ Composite gained 71.76 points (1.1%) to 6,862.48, and the S&P 500 rallied 16.89 points (0.6%) to 2,599.03 Tuesday. DJIA futures were 25 points higher early Wednesday morning. Asian markets closed higher with Japan's Nikkei 225 up 106.67 points (0.5%), Hong Kong's Hang Seng gaining 185.42 points (0.6%), and China's Shanghai Composite up 19.97 points (0.6%). European markets were trading mostly higher with London's FTSE 100 up 17.89 points (0.2%), Germany's DAX down 52.11 points (0.4%), and France's CAC 40 off 3.34 points. The euro was 0.0013 higher at 1.1751 while the U.S. dollar index lost 0.14 to 93.84. December 30-year T-Bonds were 11/32 lower at 153'24 while December gold gained $1.50 to $1,283.20. Crude oil was $1.06 higher at $57.89 while Brent crude added $0.65 to $63.22. China's Dalian soybean and Malaysian palm oil futures were both higher overnight.

	BULL		BEAR
1)	Light commercial buying in corn has the nearby futures spread in position for a slightly less bearish close to the week.	1)	Seasonal basis (national average) strength in corn tends to top out in late November, or in other words, about now.
2)	Noncommercial selling interest could slow if commercial buying is hinted at late in the week.	2)	Noncommercial traders may be waiting for a continued small rally in soybeans to unload some of their long futures positions.
3)	Radioactive wheat was reportedly found in Russia. So there's that.	3)	Minneapolis spring wheat looks to be losing some of its bullish luster.

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 COMMENTS

CORN Twas Thanksgiving Day Eve early morn, most creatures were stirring, except for in corn. The Dec contract napped its way through another 1 1/2 cent trading range overnight on decent pre-holiday volume (futures only) of 10,100 contracts. Technically Dec corn looks poised for a bullish breakout on its daily chart, a move that could take it back toward the high-end of a resistance range between roughly $3.45 and $3.52. The next CFTC Commitment of Traders report will be through Tuesday's close, and is likely to show noncommercial traders slowly covering their net-short futures positon. Wednesday's session could be interesting, for lack of a better word, depending on if commercial traders continue to provide support. With Black Friday, and the end of the holiday week, creeping up a close by the December-to-March futures spread in neutral-to-bearish territory, as opposed to just bearish, could trigger more buying interest next week.

SOYBEANS Soybean contracts were trading higher early Wednesday on hints, but hints only, of light commercial buying interest. The carry in the 2017-2018 forward curve (January 2018 through July 2018 contracts) was slightly weaker (emphasis on the word slightly), a development the market needs to see continue if the market has plans of moving into a seasonal uptrend at some point. For now, noncommercial traders already holding a net-long futures position are likely waiting for small rallies to liquidate some of their holdings. But, if futures spreads can start showing a less bearish view of fundamentals, noncommercial traders could hold off on selling. All of this is down the road, with Wednesday's action expected to be low volume but potentially high(er) volatility. Traders continue to monitor weather in South America, with interest picking up once the U.S. Thanksgiving Holiday has come and gone.

WHEAT The wheat complex was mixed, with Minneapolis spring wheat showing small losses while a rally in winter wheat was led by Kansas City (HRW). There the December contract climbed as much as 2 1/4 cents through early Wednesday morning, and was sitting on its high as of this writing. It's possible light commercial buying was behind the rally, though spread activity can be skewed by low trade volume. However, wheat has been looking for that Chaos Theory event, that Butterfly Effect, and may have seen it in radioactive wheat reportedly found in Russia. Yes, you read that right. If so it could, emphasis on "could", spark more export interest in non-glowing U.S. winter wheat supplies, with the largest of that being of HRW variety.

DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.09	$0.01	-$0.36	Dec	$0.008
Soybeans:	$9.14	-$0.01	-$0.75	Jan	$0.005
SRW Wheat:	$3.93	$0.03	-$0.32	Dec	$0.002
HRW Wheat:	$3.67	$0.04	-$0.53	Dec	-$0.001
HRS Wheat:	$6.01	$0.01	-$0.26	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

(BAS)

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