DTN Early Word Grains
That Friday Feeling
March corn was 1 cent higher, January soybeans were 3 cents higher, and March Chicago (SRW) was 1 cent higher.
CME Globex Recap:TGOC (the grain and oilseed complex) was feeling TGIF (thank goodness it's Friday) overnight into Friday morning after a week of failed rallies (soybeans), new lows (winter wheat), and a whole lot of nothing (corn). Overnight trade saw the complex trading higher, along with energies, despite a stronger U.S. dollar index. The latter may have found renewed support on headlines that the United Kingdom and European Union may have finally worked out the terms of Brexit. Financial markets are also looking ahead to Friday's morning's November jobs data.
OUTSIDE MARKETS:The Dow Jones Industrial Average closed 70.57 points (0.3%) higher at 24,211.48, the NASDAQ Composite gained 36.47 points (0.5%) to 6,812.84, and the S&P 500 rallied 7.71 points to 2,636.98 Thursday. DJIA futures were 45 points higher early Friday morning. Asian markets closed higher with Japan's Nikkei 225 up 313.05 points (1.4%), Hong Kong's Hang Seng rallying 336.66 points (1.2%), and China's Shanghai Composite adding 17.94 points (0.6%). European markets were trading higher with London's FTSE 100 up 18.81 points (0.3%), Germany's DAX gaining 164.97 points (1.3%), and France's CAC 40 up 23.08 points (0.4%). The euro fell another 0.0037 to 1.1736 as the U.S. dollar index gained 0.27 to 94.03. March 30-year T-Bonds were 3/32 lower at 152'25 while February gold lost another $5.20 to $1,247.90. Crude oil was $0.37 higher at $57.06 while Brent crude added $0.34 to $62.54. China's Dalian soybean and Malaysian palm oil futures were both lower again overnight.
P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
| BULL | BEAR | ||
| 1) | March corn continues to show a short-term uptrend on its daily chart. | 1) | Total export shipments of corn through November 30 are on pace for a total of marketing year figure of 1.6 bb, 590 mb less than last year. |
| 2) | Soybeans could see a small recovery rally Friday following the sharp sell-off of the previous two days. | 2) | A small rally by new-crop November soybeans would actually create a sell signal on its weekly chart. |
| 3) | Light spillover buying from the other grains could support wheat Friday. | 3) | New-crop July contracts of both Chicago and Kansas City wheat have posted new lows this week. |
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MORE COMMODITY-SPECIFIC COMMENTSCORN Corn contracts were quietly higher overnight, with March posting a 2 1/4 cent trading range on volume (futures only) of 7,100 contracts through early Friday morning. Despite this week's sell-off, the contract continues to show a minor (short-term) uptrend on its daily chart reflecting at least light buying interest from noncommercial traders. On the other hand, commercial interests continue to grow more bearish as indicated by the strengthening carry of the market's 2017-2018 forward curve. Thursday's weekly export shipments update (through the week ending Thursday, November 30) showed corn running 38% behind last year and projecting to total marketing year shipments of only 1.6 bb based on the 3-year average percent shipped at this point of the marketing year. Delivery of another 464 contracts was reported against the December issue, putting the total at 7,269 contracts.
SOYBEANS The chatter in the soybean market continues to be forecasts of dry conditions across Argentina. It's possible this grabbed hold again overnight, leading to a modest rally through early Friday morning. It's also possible the market is just taking a breather from two days of heavy selling that has seen the nearby January contract fall a total of 27 cents. Technically, new-crop November 2018 is set to establish a sell signal on its weekly chart with Friday's close, with a potential rally actually increasingly the likelihood such a signal will be seen. Fundamentally there is little but South American weather to get excited about. Thursday's weekly export shipments update (through the week ending Thursday, November 30) showed soybeans running behind last year by 11%, with a 3-year average projected total shipment figure of 2.02 bb. If realized this would be 6% below last marketing year.
WHEAT Winter wheat contracts were posting small gains early Friday, though new-crop July contracts of both Chicago and Kansas City couldn't hide the technical damage done by new lows posted this week. Fundamentally wheat is just bearish, long-term, as indicated by the strong carry in both old-crop and new-crop forward curves. As for old-crop, Thursday's weekly export shipments update showed the marketing year total for all wheat running 8% behind last year with the 3-year average projecting total shipments coming in near 870 mb, or roughly 100 mb less than the previous marketing year. Delivery of another 25 contracts was reported against the December Chicago issue, putting its total at 4,724 contracts. Delivery of another 5 contracts was reported against the December Kansas City issue, putting its total at 820 contracts.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.10 | -$0.01 | -$0.41 | Mar | $0.003 |
| Soybeans: | $9.19 | -$0.10 | -$0.73 | Jan | $0.006 |
| SRW Wheat: | $3.83 | -$0.03 | -$0.39 | Mar | $0.003 |
| HRW Wheat: | $3.63 | -$0.02 | -$0.58 | Mar | $0.008 |
| HRS Wheat: | $5.83 | -$0.02 | -$0.28 | Mar | $0.012 |
Darin Newsom can be reached at darin.newsom@dtn.com
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