DTN Closing Grain Comments

General Comments:

Corn was down 3 cents in the May contract and down 2 cents in the December. Soybeans were down 16 1/2 cents in the May contract and down 15 1/4 cents in the November. Wheat closed up 2 1/4 cents in the May Chicago contract, up 4 1/2 cents in the May Kansas City and down 3 3/4 cents in the May Minneapolis contract.

The March U.S. dollar index is up 0.05 at 89.69. April gold is down $1.70 at $1,325.40 while May silver is down 8 cents and May copper is up $0.0175. The Dow Jones Industrial Average is down 130 points at 24,878. April crude oil is up $0.06 at $60.79. April heating oil is up $0.0111 while April RBOB gasoline is up $0.0292 and April natural gas is down $0.058.

Corn:

May corn fell 3 cents to $3.88 3/4 in light trading, a modest loss on a day that saw most grain-related contracts finish lower. Even so, corn prices are still near their highest level in over six months with ongoing support from dry weather in Argentina. Wednesday's seven-day forecast remains mostly dry for Argentina's main crop area with chances of rain in the northeastern part of the country. While May corn has paused below $3.95, two issues on traders' minds are likely USDA's big export estimate of 2.225 billion bushels (bb) and USDA's Grain Stocks and Prospective Planting reports on March 29. So far, there is not much evidence favoring USDA's higher export estimate and the other two reports have potential to be market movers, in either direction. USDA's early estimate of 90.0 million acres (ma) for corn and soybeans each should be a close guess, but planting estimates can hold surprises. In the meantime, the trend in May corn remains up with prices holding quietly sideways this week. DTN's National Corn Index closed at $3.54 Tuesday, priced 38 cents below the May contract and down from its July high. In outside markets, the March U.S. dollar index is up 0.05, not showing much response to news from the U.S. Labor Department that the core rate of producer prices was up 2.7% in February from a year ago.

Soybeans:

May soybeans fell 16 1/2 cents to $10.32 1/4 and May soybean meal dropped $4.60 to $370.90 as talk of increased tariffs against China likely gave bullish traders second thoughts about owning soybeans. Argentina's crop weather is still expected to be mostly dry the next seven days, but other bearish concerns include Brazil's big harvest, which seems to be going well, and USDA's Grain Stocks and Prospective Plantings reports on March 29. Dow Jones' survey expects Thursday's crush report from the National Oilseed Processors Association to show 148.5 million bushels (mb) of soybeans crushed in February, up 4% from a year ago, if true. Soybean oil stocks are expected to total 1.786 billion pounds at the end of February. Soybean exports have struggled in 2017-18 and may not see much change in Thursday morning's weekly report from USDA. Fundamentally, soybeans continue to have plenty of bearish risk and the latest bearish change in short-term momentum has trends in soybeans and meal at risk of turning lower. DTN's National Soybean Index closed at $9.69 Tuesday, down from its highest price in over a year and priced 80 cents below the May contract.

Wheat:

May Chicago wheat ended up 2 1/4 cents and May Kansas City wheat was up 4 1/2 cents at $5.24 3/4, a quietly higher day of trading that is still finding support from a dry seven-day forecast for the southwestern U.S. Plains. Late Monday, the NASS office in Kansas reported 53% of winter wheat in either poor or very poor condition as extreme drought conditions show no sign of going away yet. Red flag warnings are back in Kansas Wednesday with risk of wildfires over an even wider area. Fundamentally, we have to keep in mind that U.S. winter wheat production accounted for less than 5% of world production in 2017, but with little to report yet internationally, early drought in the U.S. is keeping the short side of the winter wheat market on its heels. For now, the trends remain up in both, Chicago and K.C. wheat. May Minneapolis wheat is holding sideways and could turn bullish with a close above $6.40. DTN's National SRW index closed at $4.51 Tuesday, down from its highest price in seven months and 35 cents below the May contract. DTN's National HRW index closed at $4.76, down from its highest price in over two years.

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

Follow Todd Hultman on Twitter @ToddHultman1

(CZ)

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