DTN Before The Bell Grain Comments

Morning CME Globex Update:

May contracts of corn, soybeans, and all three wheats were higher early Monday, helped by hopeful trade talk over the weekend and ongoing planting difficulties for corn and spring wheat. Dow Jones futures were also higher with China's President Xi Jinping set to speak on Tuesday. At 8 a.m. CDT, USDA announced 8.5 million bushels (232,500 mt) of U.S. soybeans were sold to unknown destinations for 2017-18.

Other Markets:

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

Corn:

May corn was up 1 1/4 cents early Monday, helped by light commercial buying and bullish influence from higher soybean prices overnight. Monday's weather map has snow falling from Iowa to Indiana, another impediment to early planting. The central Corn Belt will be helped by warmer temperatures later this week, but the northern states will continue to be too cold for planting. Friday's CFTC data showed noncommercials still bullish in corn as of Apr. 3, having increased net longs from 301,735 to 367,317, back near their most bullish holding on record. Tuesday's WASDE report will be focused on the old-crop season and is apt to show higher ending U.S. stocks of corn and a smaller crop in Argentina. The trend in May corn remains sideways while the trend in December corn is up. DTN's National Corn Index closed at $3.54 Friday, down from its highest prices since June 2016 and priced 35 cents below the May contract. In outside markets, the June U.S. dollar index is down 0.09 and Dow Jones futures are up 149 points with China's President set to speak on trade issues Tuesday.

Soybeans:

At 8 a.m. CDT, USDA announced 8.5 million bushels (232,500 mt) of U.S. soybeans were sold to unknown destinations for 2017-18. May soybeans were up 12 cents at the morning break Monday, supported by early commercial buying and many U.S. officials continuing to express hope that negotiations with China can replace the long lists of proposed tariffs. CNBC reported China's President Xi Jinping will speak on Tuesday and many are hoping he will move closer to an easing of tensions with the U.S. This week's snow across the central Corn Belt will keep corn planting delayed, but warmer temperatures are expected across the central Corn Belt later this week while the northern states remain cold. Friday's CFTC data showed noncommercials a little more bullish in soybeans on Apr. 3, the day before China proposed a 25% tariff on U.S. soybeans. Net longs were increased to 210,461, the most since July 2016. Tuesday's WASDE report is likely to show a smaller crop estimate for Argentina, but Brazil's crop may show a slight increase and U.S. ending soybean stocks are expected to increase as export demand has been slow. Technically, the trend in May soybeans is sideways while the trend in new-crop soybeans remains up. DTN's National Soybean Index closed at $9.62 Friday, up from its lowest prices in over a month and priced 72 cents below the May contract.

Wheat:

May Chicago wheat was up 5 3/4 cents and May K.C. wheat was up 7 1/4 cents, both showing help from light commercial buying and another seven-day forecast for mostly dry weather in the southwestern U.S. Plains. Meanwhile, May Minneapolis wheat is up 7 cents with cold temperatures expected to keep snow on the ground across the northern Plains this week. Friday's CFTC data showed noncommercials lightly bearish in Chicago wheat, holding 16,590 net shorts on Apr. 3. Commercials reduced net longs slightly, to 24,859, finding good value in the mid to upper $4s. Fundamentally, the rest of the world will have a lot to say as to which direction wheat prices head in 2018, but for now the trends in winter wheat are sideways and Sep Minneapolis wheat is coming off of last week's bullish outside reversal. DTN's National SRW index closed at $4.42 Friday, up from its lowest close in over a month and 31 cents below the May contract.

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

FollowTodd on Twitter @ToddHultman1

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