DTN Before The Bell Grain Comments

Morning CME Globex Update:

May contracts of corn and soybeans were modestly higher with early support from commercial buying in soybeans and meal while Argentina remains dry. Winter wheat prices were a little lower with chances for rain getting close to, but not quite reaching northern Texas. At 8 a.m. CDT, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to unknown destinations and 120,000 mt of U.S. soybean meal was sold to Spain, both for 2017-18.

Other Markets:

Dow Jones:	Higher
U.S. Dollar Index:	Lower
Gold:	Lower
Crude Oil:	Lower

Corn:

May corn was up 1 1/2 cents early Monday with bullish influence from buying throughout the soy complex. Monday's weather map has snow in the northwestern U.S. Plains, some rain from Omaha to Kansas City and is mostly dry elsewhere. The next few days will see more rain hit the already wet area from eastern Texas to southern Illinois with some of the heaviest amounts over Arkansas, once again. A flood watch is posted from eastern Oklahoma to southern Illinois. Further south, Argentina is expected to stay mostly dry again this week with better, but late rain chances over Paraguay. Central Brazil is expecting light to moderate amounts, favorable for soybean harvest and planting of the second corn crop. Friday's CFTC data showed noncommercials still extremely bullish in corn, holding 378,601 net longs as of Mar. 20. Technically, May corn is trying to hold sideways with support near $3.70. DTN's National Corn Index closed at $3.40 Friday, near the lowest close in three weeks and priced 37 cents below the May contract. In outside markets, the June U.S. dollar index is down 0.16 and Dow Jones futures are up 316 points offering early support for grain prices while trade tensions with China remain a concern.

Soybeans:

At 8 a.m. CDT, USDA announced 4.85 million bushels (132,000 mt) of U.S. soybeans were sold to unknown destinations and 120,000 mt of U.S. soybean meal were sold to Spain, both for 2017-18. May soybeans were up 6 1/2 cents Monday with help from early commercial buying, also seen in soybean meal and oil. Of course, it doesn't hurt that Argentina's forecast remains mostly dry again this week and the Buenos Aires Grain Exchange dropped last week's soybean crop estimate to 39.5 mmt or 1.45 bb. Among bearish concerns, Dow Jones' reported Brazil's harvest was 65% complete late Friday and the top producer, Mato Grosso, is 96% done. That should help China stay well supplied with soybeans, at least until September. Friday's CFTC data showed noncommercials still bullish in soybeans, holding 197,820 net longs as of Mar. 20 and not backing down much even though old-crop prices have. Technically, May soybeans may have found short-term support at $10.10 and will be challenged by Thursday's USDA Grain Stocks and Prospective Plantings reports. DTN's National Soybean Index closed at $9.50 Friday, near its lowest close in a month and priced 78 cents below the May contract.

Wheat:

May Chicago wheat was down 3 cents early with Monday's seven-day forecast offering some rain to northern Texas, but mostly staying to the eastern sides of Oklahoma and Texas while the western edge of the southwestern U.S. Plains remains dry. The soggy SRW wheat crop is in for more rain this week. Friday's CFTC data showed noncommercials turned slightly bearish in Chicago wheat, going from 6,029 net longs to 4,401 net shorts as of Mar. 20. Commercials increased net longs to 12,687, a hint of increased support for prices near $4.50. Thursday's USDA reports are not apt to hold much surprise for wheat prices unless it comes from corn's influence. Fundamentally, the world still has plenty of competing wheat supplies, making U.S. exports difficult and it won't be long before we start hearing more about crop conditions from Europe to Russia. Technically, the trends in both, Chicago and K.C. wheat have turned down. DTN's National SRW index closed at $4.28 Friday, near its lowest close in a month and 32 cents below the May contract.

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

Follow Todd on Twitter @ToddHultman1

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