DTN Early Word Grains
Green Again
March corn was fractionally higher, January soybeans were 3 cents higher, and March Chicago (SRW) wheat was fractionally higher.
CME Globex Recap:The grain and oilseed complex was green again overnight into early Friday morning, led by commercial buying in Chicago wheat. Soybeans posted a modest rally while corn, as usual, was fractionally higher. Softs and metals were mostly higher as cotton and gold continued to see solid buying interest. The energy complex was also higher. The U.S. dollar index was lower while DJIA futures rallied.
OUTSIDE MARKETS:The Dow Jones Industrial Average closed 76.77 points (0.3%) lower at 24,508.66, the NASDAQ Composite lost 19.27 points (0.3%) to 6,856.53, and the S&P 500 dropped 10.84 points (0.4%) to 2,652.01 Thursday. DJIA futures were 47 points higher early Friday morning. Asian markets closed mostly lower with Japan's Nikkei 225 down 141.23 points (0.6%), Hong Kong's Hang Seng off 318.27 points (1.1%), and China's Shanghai Composite losing 26.30 points (0.8%). European markets were trading lower with London's FTSE 100 down 1.20 points, Germany's DAX off 30.33 points (0.3%), and France's CAC 40 losing 13.83 points (0.3%). The euro gained 0.0030 to 1.1807 as the U.S. dollar index fell 0.26 to 93.43. March 30-year T-Bonds were 4/32 lower at 153'31 while February gold gained $3.60 to $1,260.70. January bitcoin was $1,550 higher at $18,350. Crude oil was $0.38 higher at $57.42 while Brent crude added $0.17 to $63.48. China's Dalian soybean futures were mostly higher and Malaysian palm oil futures were higher overnight.
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| BULL | BEAR | ||
| 1) | Both old-crop March and new-crop December corn are nearing the establishment of bullish short-term technical patterns. | 1) | Total marketing year shipments of corn continue to project total demand well below the 3-year average, even excluding last year's outlier demand. |
| 2) | New-crop November soybeans could also post bullish technical signals Friday. | 2) | The carry in soybeans forward curve continues to grow stronger, indicating a more bearish old-crop supply and demand situation. |
| 3) | And let's not forget about the potentially bullish bottoming pattern forming in new-crop winter wheat contracts. | 3) | Total marketing year export shipments of wheat continue to run well behind the expected pace. |
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 Once again, corn did little overnight with contracts showing fractional gains on spillover buying from soybeans and wheat. Old-crop March posted a 1 cent trading range through early Friday morning on volume (futures only) of 6,500 contracts. However, March corn continues to consolidate above this week's new contract low of $3.47 1/2, hinting at the possible establishment of a new minor (short-term) uptrend on its daily chart. New-crop December is showing a similar pattern as it holds above its contract low of $3.80. Fundamentally corn remains bearish with total 2017-2018 marketing year shipments coming in at 346 mb (as of Thursday, November 7). Based on the 3-year average of percent shipped at this point of the marketing year, corn's pace would suggest a marketing year total of 1.645 bb. Delivery of another 142 contracts was reported against the December issue, putting the total at 7,919 contracts.
SOYBEANS Soybean contracts were roughly 3 cents higher early Friday morning, supported by an overnight round of noncommercial buying interest. On the other hand, commercial traders looked to be light sellers as the carry in the market's forward curve quietly strengthened. The key will be whether or not the latter continues throughout Friday's session, for if it does, noncommercial buying could start to wane leaving the market open to a lower close. Fundamentally old-crop soybeans remains bearish, as indicated by futures spreads through the July 2018 contract. New-crop November soybeans fell below short-term technical price support near $9.91 1/2 Thursday but continue to hold above its previous low of $9.80 1/2. Seasonally Nov beans tend to see a small sell-off from early December through mid-January (for more discussion on new-crop seasonal patterns, see this week's Newsom on the Market column posted Friday morning on DTN subscription sites).
WHEAT Winter wheat contracts were showing small gains early Friday morning following a quiet overnight session. One of the more interesting aspect of the markets was the possible change in secondary (intermediate-term) trends for both new-crop July Chicago and Kansas City contracts on their respective weekly charts. After spiking to a new low earlier this week, July KC is in position to close higher while weekly stochastics (secondary momentum study) near a bullish signal. While little has changed fundamentally, long-term, a technical change could be enough to trigger a round of noncommercial buying interest in both Kansas City and Chicago. Delivery of another 153 contracts was reported against the December Chicago issue, putting its total at 5,403 contracts. Delivery of another 28 contracts was reported against the December Kansas City issue, putting its total at 992 contracts.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.09 | -$0.01 | -$0.39 | Mar | -$0.001 |
| Soybeans: | $8.96 | -$0.11 | -$0.71 | Jan | $0.003 |
| SRW Wheat: | $3.80 | $0.02 | -$0.38 | Mar | $0.003 |
| HRW Wheat: | $3.63 | $0.02 | -$0.56 | Mar | -$0.001 |
| HRS Wheat: | $5.89 | $0.05 | -$0.28 | Mar | $0.002 |
Darin Newsom can be reached at darin.newsom@dtn.com
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