Morning CME Globex Update:
Grains and oilseeds are off to a quiet start on the Tuesday before Christmas, a possible preview as to how the rest of the day will go. Outside commodities are mixed with February crude oil up 21 cents. At 8 a.m. CST, USDA announced 5.3 million bushels (145,000 mt) of U.S. soybeans were sold to unknown for 2018-2019.
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March corn was up 1/2 cent early Tuesday, staying in its pattern of low volatility trading near its low for 2017 while nothing is happening to challenge the bearish views of noncommercial traders. Large U.S. supplies and a slow pace of exports are the official reasons for corn's low prices, but generally favorable conditions for the next South American crops are also adding bearish weight. Here in the U.S., the Corn Belt will have a couple more days of pleasant weather before snow arrives in the northern states on Thursday, bringing colder temperatures into the weekend. Technically, the trend in March corn remains down with noncommercial traders bearish and commercials willing to go long, but showing no interest in bidding corn prices higher. DTN's National Corn Index closed at $3.09 Monday, priced 38 cents below the March contract and down from its highest price in two months. In outside markets, the March U.S. dollar index is down 0.12 and other commodities are mixed.
At 8 a.m. CST, USDA announced 5.3 million bushels (145,000 mt) of U.S. soybeans were sold to unknown for 2018-2019. January soybeans were up a penny at the morning break, showing a slight bounce after falling to a new three-month low on Monday. Tuesday's satellite map for South America looks mostly dry with rain possible in eastern Argentina. The seven-day forecast has more chances for rain, this time in central and southern Brazil while Argentina stays drier. For the past three months, soybeans was the crop with the most bullish possibility, but those hopes are fading as seen by last week's lower number of noncommercial net longs. With crop conditions generally favorable, except for some concerns of dryness in southern Brazil and Argentina, the trend in January soybeans remains down after Monday's new three month low. DTN's National Soybean Index closed at $8.92 Monday, priced 69 cents below the January contract and within three cents of its November low.
March Chicago wheat was up 3/4 cent early, still holding a small gain on the week, but not going anywhere fast. Rain is falling in eastern Texas early Tuesday with heavy amounts expected to head to the Delta and southeastern U.S. later this week. The rest of the southwestern Plains however, will remain dry, keeping interest in the region as we navigate through winter. With USDA estimating 960 million bushels of excess wheat in 2017-18, wheat prices remain under bearish pressure while noncommercial traders are holding their largest short position since April. Traders remain vulnerable to short-covering in this situation, but so far, there is nothing bullish happening to cause concern. DTN's National SRW index closed at $3.84 Monday, priced 37 cents below the March contract and up from its lowest price in seven months.
Todd Hultmancan be reached at firstname.lastname@example.org
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