DTN Closing Grain Comments

General Comments:

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

The June U.S. dollar index is up 0.57 at 89.90. April gold is down $6.00 at $1,311.80 while May silver is down 13 cents and May copper is down $0.0440. The Dow Jones Industrial Average is up 109 points at 24,720. May crude oil is up $1.42 at $63.55. May heating oil is up $0.0440, May RBOB gasoline is up $0.0391, and May natural gas is up $0.023.

Corn:

May corn ended down a half-cent at $3.74 1/2, keeping a low profile and posting a fifth consecutive lower close with not much in the way of news happening on Tuesday. USDA did say 4.3 million bushels (mb) (110,000 metric tons) of U.S. corn were sold to Peru for 2017-18, but it remains to be seen if corn exports will be able to hit USDA's optimistic estimate of 2.225 billion bushels (bb). On Monday, Agricultura Brazil reported on Twitter that 92% of the second corn crop was planted in south-central Brazil, close to its usual pace. Meanwhile, row crops in Argentina continue to suffer with another mostly dry forecast for this week. Here in the U.S., Texas has started planting corn, and it looks like the eastern Midwest may see some fieldwork delays due to wet conditions this spring. Technically, the weekly stochastic has turned bearish for corn, and there is no strong bullish argument to turn prices higher. Unless, that is, USDA's Grain Stocks and Prospective Plantings reports on March 29 are holding a surprise. DTN's National Corn Index closed at $3.38 Monday, its lowest close in three weeks and priced 37 cents below the May contract. In outside markets, the June U.S. dollar index is up 0.57 with many expecting a quarter-percent rate hike at the conclusion of Wednesday's Federal Reserve meeting.

Soybeans:

May soybeans closed up 5 3/4 cents, taking back a small piece of Monday's 27-cent drop with help from commercial buying and a $3.10 gain in May soybean meal. It seems fair to say that Monday's big drop was mostly about the combination of commercial and noncommercial selling after Friday's CFTC data showed noncommercial traders with their largest net-long position since July 2016. With Brazil taking in a near-record soybean harvest and the U.S. getting ready to possibly plant 90 million acres (ma) or more, that level of extreme speculator bullishness seems out of step and more liquidation may be coming. Fundamentally, Argentina's drought has helped to trim the world's soybean surplus, but supplies should remain comfortable as long as weather cooperates again in the U.S. Technically, the weekly stochastics have turned bearish for both soybeans and soybean meal, keeping traders under pressure to liquidate. DTN's National Soybean Index closed at $9.44 Monday, its lowest close in a month and 78 cents below the May contract.

Wheat:

May Chicago wheat closed up 2 1/4 cents at $4.53 Tuesday, taking attention from Kansas City wheat for a day while moderate to heavy rain in the seven-day forecast for the eastern Midwest presents a potential problem of wet conditions for the SRW wheat crop. While central Kansas received beneficial rain Monday, Oklahoma and Texas are still dry and the seven-day forecast is not offering much more than light amounts. Not factoring in Kansas' most recent rain, the state NASS offices of Kansas, Oklahoma, and Texas gave their winter wheat crops poor-to-very poor ratings of 55%, 60%, and 66% respectively, late Monday -- three states that represent roughly 40% of the U.S. winter wheat crop. Fundamentally, there is still plenty of wheat available around the globe, but it is too early to know much about world production in 2018. Technically, the trend has turned down in Chicago wheat, while May K.C. wheat is holding above its February low of $4.86. DTN's National SRW index closed at $4.18 Monday, 7 cents above its February low and 32 cents below the May contract. DTN's HRW index closed at $4.28 Monday, not far above its February low.

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

Follow Todd Hultman on Twitter @ToddHultman1

(CZ)

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