DTN Closing Grain Comments

General Comments:

Corn closed down 1 1/4 cents in the March contract and down 1 3/4 cents in the July. Soybeans closed up 5 cents in the March and up 4 1/2 cents in the July. Wheat closed down 3/4 cent in the March Chicago, up 1/2 cent in the March Kansas City, and down 4 1/4 cents in the March Minneapolis. The March U.S. dollar index is down 0.40 at 91.89. February gold is up $7.70 at $1,304.90 while March silver is up $0.06 and March copper is down 0.0160. The Dow Jones Industrial Average is down 34 at 24,803. February crude oil is up $0.57 at $60.41. February heating oil is up $0.0236, February RBOB gasoline is up $0.0052, and February natural gas is up $0.011.

For the week:

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

Corn:

March corn ended down 1 1/4 cents Friday, not deviating from its sideways-to-lower script the past four months as prices remain pinned down by a fifth consecutive big harvest and the most ending U.S. corn stocks since the 1980s. Along with plenty of supplies goes a slow export pace which shows no sign of changing yet. Early Friday, USDA said last week's export sales and shipments of corn totaled 49.0 million and 20.5 million bushels, respectively, bearish amounts that have total shipments down 36% in 2017-18 from a year ago. Just the past two weeks, Brazil's FOB corn prices jumped higher and are now 26 cents above prices at the U.S. Gulf, but so far the advantage has not translated to higher U.S. export business. As we close the door on 2017, March corn remains in a downtrend, near its lowest spot prices in 11 years. DTN's National Corn Index closed at $3.17 Thursday, priced 35 cents below the March contract and near its highest price in four months. In outside markets, the March U.S. dollar index is trading down 0.40 at its lowest prices in three months as Europe has shown better signs of growth toward the end of 2017. February gold was trading up $7.70 at its highest prices in two months.

Soybeans:

March soybeans closed up a nickel Friday, attracting commercial buying interest on the final day of 2017 while prices were near their lowest levels in four months. Soybean prices also received unexpected help from a 0.55 gain in March soybean oil, just one day after bean oil fell to a new six-month low. Behind the gain was news that last week's soybean oil export sales hit a new marketing year high of 44,200 metric tons, thanks to big purchases from South Korea, Colombia, and the Dominican Republic. For soybeans themselves, the export pace remains bearish after USDA said last week's sales and shipments of U.S. soybeans totaled 35.8 million and 51.8 million bushels, respectively, a bearish combination for the week that has total shipments down 14% in 2017-18 from a year ago. Part of soybeans' export problems were explained by a Wednesday article in Bloomberg news which reported this year's U.S. soybean harvest had a 34% protein content versus 37% in Brazil. The main bearish risk for soybeans is that crop conditions look favorable for South America overall, especially in Brazil where rains have been more frequent. Technically, the trend remains down for March soybeans with no serious weather problems cited yet as we flip the calendar to 2018. DTN's National Soybean Index closed at $8.80 Thursday, priced 77 cents below the March contract and near its lowest price in over two months.

Wheat:

March Chicago wheat ended down 3/4 cent Friday, closing out 2017 with just shy of a 5% gain for spot prices. Drought concern in June and early July was the only real excitement that winter wheat prices had in 2017 and provided a brief opportunity for spot Chicago wheat above $5.50 a bushel, but only for the quickest triggers as prices fell apart quickly after July 11. The rest of the year has been dominated by an outlook for nearly a billion bushels of ending U.S. wheat stocks and nearly 9.9 billion bushels of world ending stocks, the most ever thanks to big harvests in Russia and Europe. Along with heavy global supplies typically goes a slow pace of exports and that has been true for the U.S. so far in 2017-18. Early Friday, USDA said last week's export sales and shipments of wheat totaled 17.6 million and 19.3 million bushels, respectively, a bearish combination for the week that has total shipments down 6% in 2017-18 from a year ago. Sitting at roughly one-third of its peak price in 2008, spot Chicago wheat remains in a downtrend with a new year of possibilities ahead. DTN's National SRW index closed at $3.94 Thursday, priced 34 cents below the March contract and near its highest price in three months. DTN's National HRW index closed at $3.75, at its highest price in three months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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