DTN Closing Grain Comments

Red Valentine Day Start Finishes Mostly Green

Todd Hultman
By  Todd Hultman , DTN Grains Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn was up 1/2 cent in the March contract and up 1/2 cent in the December. Soybeans were up 5 1/2 cents in the March contract and up 3/4 cent in the November. Wheat closed down 5 cents in the March Chicago contract, down 4 3/4 cents in the March Kansas City and down 1 1/2 cents in the March Minneapolis contract.

The March U.S. dollar index is down 0.55 at 89.04. April gold is up $24.60 at $1,356.00 while March silver is up 33 cents and March copper is up $0.0695. The Dow Jones Industrial Average is up 180 points at 24,820. March crude oil is up $1.22 at $60.41. March heating oil is up $0.0415 while March RBOB gasoline is up $0.0231 and March natural gas is up $0.003.

Corn:

Like many commodities on Wednesday, March corn started the day a little lower, but finished with a positive gain, ending up a half-cent at $3.67 1/4. Ongoing concerns about rising interest rates and volatile trading in stocks continue to spill over into commodity markets at times, but grain prices are largely resisting the bearish influence. The latest seven-day forecast remains mostly dry for Argentina and southern Brazil and few clouds could be found over Argentina on Wednesday. Here in the U.S., the seven-day forecast looks similar to Tuesday's with the best rain chances in the southeastern Corn Belt while the rest of the region stays mostly dry. The U.S. Energy Department said last week's ethanol production dropped from 1.057 to 1.016 million barrels per day (bpd) while inventory also fell, from 23.5 to 22.9 million bpd, another overall show of support for corn prices. Closer to the farm, DTN's National Corn Index continues to work higher during these winter months and is now at $3.36, priced 31 cents below the March contract and near its six-month high. The rising trend in March corn is not as steep as it is in cash corn, but it is up for now. In outside markets, the March U.S. dollar index is down 0.55 after traders caught on that the core rate of consumer prices in the U.S. was only up 1.8% in January from a year ago, not as high as the all items increase of 2.1%. Also, RTTNews.com reported real GDP in the Euro Area increased 2.5% in 2017, the highest in a decade.

Soybeans:

March soybeans also overcame an early deficit to finish up 5 1/2 cents on the day, at $10.17 1/4. March soybean meal was up $4.70 while bean oil was up 0.23. The two have been trending in opposite directions while Argentina's crop conditions remain a concern and U.S. crush margins are high, providing added interest to Thursday's crush report from the National Oilseed Processors Association. The latest seven-day forecast is mostly dry for Argentina and southern Brazil with warmer temperatures expected to return to Brazil by this weekend. Wednesday's satellite map showed a drier day for central Brazil, which is helpful for the current soybean harvest. While March soybean meal remains in a bullish uptrend, soybean prices have been reluctant to trade higher, held back by the anticipation of Brazil's big harvest and poor pace of U.S. soybean exports. Tuesday's new two-month high in March soybeans however, turned the trend higher. DTN's National Soybean Index closed at $9.43 Tuesday, its highest price in six months and 69 cents below the March contract.

Wheat:

March Chicago wheat dropped a nickel Wednesday, pressured by a light commercial selling response to prices dangling near their highest levels in four months. Similarly, March Kansas City wheat ended down 4 3/4 cents at $4.69 3/4 with evidence of light noncommercial selling. The latest seven-day forecast continues to look mostly dry for the western Plains and fire danger is still a concern in the southwestern Plains. Pulling back from immediate concerns about the U.S. winter wheat crops, it is important to remember that there is still plenty of wheat available in the world and last year's U.S. production only accounted for 6% of global production. The result is that March Chicago wheat remains on the low end of wheat prices over the past eleven years. Meanwhile, cash wheat prices have been able to take advantage of more recent dry weather concerns and enjoy a couple months of gradually higher prices. For now, the trends remain up in winter wheat. DTN's National SRW index closed at $4.32 Tuesday, priced 29 cents below the March contract and near its highest price in six months. DTN's National HRW index closed at $4.33, also near its highest price in six months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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Todd Hultman