DTN Closing Grain Comments

Soybeans Up Again, Approach Old Highs

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

General Comments:

Corn was up 1/4 cent in the March contract and up 1/2 cent in the December. Soybeans were up 7 3/4 cents in the March contract and up 8 cents in the November. Wheat closed down 3 cents in the May Chicago contract. The May Kansas City was down 5 1/2 cents, and the May Minneapolis contract was unchanged.

The March U.S. dollar index is up 0.08 at 89.72. April gold is up $3.80 at $1,335.00 while March silver is up 24 cents and March copper is up $0.0380. The Dow Jones Industrial Average is up 250 points at 25,215. April crude oil is down $0.11 at $61.68. April heating oil is up $0.0043 while April RBOB gasoline is up $0.0065 and April natural gas is up $0.038.

Corn:

March corn ended up a quarter-cent Wednesday at $3.65 3/4 on low volume, not finding much new to trade on. The seven-day forecast for Argentina remains mostly dry as it has for several weeks, putting row crops under significant stress. Without much help from exports, March corn was able to push up to its three-month high on Argentina's news but is finding it difficult to go any further. The seasonal highs in corn are typically around late May so the current uptrend should have farther to go. Just how much higher prices go will depend on whether commercial firms can entice corn out of storage and on corn's export pace over the next several months. For now, the trend remains up. DTN's National Corn Index closed at $3.35 Tuesday, priced 30 cents below the March contract, down from its highest price in six months. In outside markets, the March U.S. dollar index is up 0.08 after MarketWatch.com reported only a couple of Fed officials were concerned about inflation heating up. April gold is up $3.80 in active trade.

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Soybeans:

March soybeans closed up 7 3/4 cents at $10.34 1/4, its highest close in seven months. Wednesday's trade was different from recent patterns in that support came from the oil side of the market after May canola jumped up $2.20 CAD to its highest close in two months. March soybean meal closed up $1.50, still lending support with Argentina facing another dry seven-day forecast. Soybean prices pushed higher, but Agriculture Brazil has reported harvest is 17% complete and 45% finished in Mato Grosso. Rain in the seven-day forecast continues to present some hindrance and deserves monitoring, but does not appear to be a significant threat yet. Here in the U.S., the incentive to crush soybeans is the highest it has been in sixteen years while exports continue to struggle, trailing last year's total at this time by 13%. The fundamental outlook for soybeans remains confusing while March soybeans and meal continue to both trend higher. DTN's National Soybean Index closed at $9.56 Tuesday, at its highest prices in seven months and priced 70 cents below the March contract.

Wheat:

May Chicago wheat fell 3 cents Wednesday while March K.C. wheat was down 5 1/2 cents to $4.81 3/4. It was not a bullish day for Chicago wheat, but prices did hold firmer than in Kansas City with heavy rains from eastern Texas to Ohio presenting flooding concerns along the Delta, and as far north as southern Illinois and southern Indiana, where much of the SRW wheat crop grows. The southwestern Plains is apt to get in on some moisture over the next few days, but amounts should be light and the seven-day forecast still looks mostly dry for the western Plains. Fundamentally, there is plenty of wheat in the world, and even if the U.S. has a smaller crop in 2018, it is not clear how the rest of the world's wheat regions will fare. Now in the off-season, the trend remains up for winter wheat. DTN's National SRW index closed at $4.21 Tuesday, down from its highest price in six months and priced 28 cents below the March contract. DTN's National HRW index closed at $4.31, also down from 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