DTN Closing Grain Comments

General Comments:

Corn closed down 1 cent in the March contract and down 3/4 cent in the July. Soybeans closed down 1/2 cent in the January and down 1/2 cent in the July. Wheat closed unchanged in the March Chicago, down 3/4 cent in the March Kansas City, and up 3 cents in the March Minneapolis. The March U.S. dollar index is up 0.40 at 93.45. February gold is up $1.40 at $1,258.50 while March silver is up $0.16 and March copper is up 0.0600. The Dow Jones Industrial Average is up 164 at 24,673. January crude oil is up $0.25 at $57.29. January heating oil is down $0.0055, January RBOB gasoline is down $0.0144, and January natural gas is down $0.072.

For the week:

March corn closed down 5 1/4 cents and July closed down 5 cents. January soybeans were down 22 1/2 cents while the July was down 22 cents. March Chicago wheat was down 3/4 cent, March Kansas City wheat was down 1/2 cent, and March Minneapolis wheat was up 8 3/4 cents.

Corn:

March corn finished a penny lower Friday and was down just over a nickel on the week, showing no ability yet to hold a gain while traders remain focused on big corn supplies and a lack of exports. At 8 a.m. CST, USDA did have news that 5.3 million bushels (134,503 mt) of U.S. corn were sold to Costa Rica for 2017-18 and corn did trade higher early, but it is going to take more than that to shake off corn's post-harvest blues. Fortunately, for corn prices, USDA is expecting 5% production increases for beef and pork in 2018 and ethanol production is near record levels. U.S. corn exports should have a better chance by February when South America's corn exports typically fall off. For now, the trend in March corn remains down with noncommercials bearish and commercials offering contrary support. DTN's National Corn Index closed at $3.09 Thursday, priced 39 cents below the March contract and down from its highest price in two months. In outside markets, most other commodities are higher Friday even though the March U.S. dollar index is up 0.40, attributed to positive expectations for the holiday economy.

Soybeans:

The January soybean contract ended a half-cent lower Friday and was down 22 1/2 cents on the week, stopping just short of its lowest price in two months. Even though Friday's monthly crush report from the National Oilseed Processors Association (NOPA) was slightly bullish, prices didn't show much buying interest until the final minutes of the session. Dow Jones said NOPA reported November's soybean crush at a record high 163.5 million bushels, more than was expected and up 2% from a year ago. Soybean oil stocks at the end of November totaled 1.33 billion pounds, also more than expected, but 1% less than a year ago. The bigger concern of course, is that South America's crops are doing fairly well so far, even though there are lingering concerns of dryness back in the seven-day forecast for southern Brazil and Argentina. Along with the lack of concern for the next round of crops, the U.S. soybean export pace has been slower than anticipated, but got a little boost early Friday when USDA said 9.4 million bushels (257,000 mt) of U.S. soybeans were sold to China and another 4.6 million bushels (126,000 mt) were sold to unknown destinations, both for 2017-18. Technically speaking, the trend remains sideways in January soybeans as long as prices stay above the November low of $9.67. DTN's National Soybean Index closed at $8.96 Thursday, priced 71 cents below the January contract and within 8 cents of its November low.

Wheat:

March Chicago wheat closed unchanged Friday and was down 3/4 cent on the week, hanging on to the slight benefit prices received from Thursday's drier looking U.S. Drought Monitor. The seven-day forecast remains mostly dry up and down the western U.S. Plains and that will be an important factor if conditions haven't improved by spring, but for now it remains difficult to shake this market out of its bearish mood while U.S. wheat supplies remains plentiful and U.S. exports are at a trickle. Adding to the trickle, USDA said earlier Friday 4.8 million bushels (130,000 mt) of SRW wheat were sold to unknown destinations for 2017-18. The more interesting game in the wheat market this winter will be to see if noncommercials get so bearish at these cheap prices that they set themselves up for a short-covering rally. For now, winter wheat has no significant bullish argument and the trend remains down. DTN's National SRW index closed at $3.80 Thursday, priced 38 cents below the March contract and up from its lowest price in seven months. DTN's National HRW index closed at $3.63, holding firmly sideways for over three months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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