DTN Closing Grain Comments

General Comments:

Corn was down 5 1/2 cents in the July contract and down 4 1/2 cents in the December. Soybeans were down 25 1/4 cents in the July contract and down 19 1/4 cents in the November. Wheat closed down 14 3/4 cents in the July Chicago contract, down 16 1/4 cents in the July Kansas City and down 12 cents in the July Minneapolis contract.

The June U.S. dollar index is up 0.18 at 92.59. June gold is down $0.20 at $1,314.50 while July silver is up 1 cent and July copper is down $0.0100. The Dow Jones Industrial Average is 112 points at 24,375. June crude oil is up $0.45 at $70.17. June heating oil is up $0.0193, June RBOB gasoline is up $0.0093, and June natural gas is up $0.026.

Corn:

July corn dropped 5 1/2 cents to $4.00 3/4 Monday, falling back from last week's new eight-month high with a modest chance of rain in south-central Brazil later this week. Overall however, Brazil's second corn crop remains dry at pollination time and is still likely suffering some yield loss from the last few weeks of dry weather. Here in the U.S., corn planting should have made good progress over the weekend and some areas will have a couple more days of good weather before moderate to heavy rains return to the Midwest this week. On the demand side, USDA said 75.4 million bushels (mb) of corn were inspected for export last week, a bullish amount that is giving corn a chance to reach USDA's export estimate of 2.225 billion bushels (bb). With many watching Brazil's dry weather, Friday's CFTC data showed noncommercials increasingly bullish in corn as of May 1, boosting net-longs from 333,416 to 393,707, the second most since 2011. Technically, last Tuesday's higher close turned the trend up in July corn, in line with what it already was in new-crop corn. CME Group reported 246 delivery intentions in May corn early Monday. DTN's National Corn Index closed at $3.70 Friday, near its highest price in 22 months and priced 36 cents below the July contract. In outside markets, the June U.S. dollar index is up 0.18, near its highest prices in four months while outside commodities are mixed.

Soybeans:

July soybeans fell 25 1/4 cents to $10.11 1/2 Monday, the lowest close in over two months as soybeans' bearish concerns reached critical mass. This season's lack of U.S. soybean exports plus the disappointment of no significant progress coming out of last week's meeting with China caused scared away potential buyers Monday, leaving July soybeans without meaningful support. Before the talks with China began, Friday's CFTC data showed noncommercials still bullish in soybeans with 203,160 net-longs as of May 1, near the most in 21 months. Even more bullish than that was soybean meal where noncommercials held 167,456 net longs, the most on record and inspired by Argentina's drought earlier this year. However July soybean meal also took it on the chin Monday, falling $11.20 to $382.50. Monday morning, USDA said 19.6 mb of soybeans were inspected for export last week, another bearish showing that has total inspections down 12% from a year ago. Technically, Monday's lower close turned the trend down in July soybeans while new-crop beans are still sideways. For May contracts, the CME Group reported 68 delivery intentions for soybeans, 0 for meal, and 108 for soybean oil early Monday. DTN's National Soybean Index closed at $9.64 Friday, in the middle of its April range and priced 73 cents below the July contract.

Wheat:

July Chicago wheat closed down 14 3/4 cents and July Kansas City wheat was down 16 1/4 cents at $5.39 1/2 as both contracts are finding it difficult to sustain last week's new nine month highs. The seven-day forecast for the southwestern U.S. Plains is not expecting much rain again this week, but the Northern Plains are in line for beneficial showers for spring wheat. Of course, not much spring wheat has been planted yet, but soil temperatures are gradually rising and Monday afternoon's Crop Progress report from USDA will give the latest update. On the demand side, USDA said 12.0 mb of wheat were inspected for export last week, another bearish showing while world wheat supplies remain tough to compete with. Speculators have turned bullish in Chicago wheat at the wrong time at least five times in a row and it may have happened again. Friday's CFTC data showed noncommercials turned from net-short to net-long, holding 23,316 contracts as May began. Technically, Tuesday's higher closes turned the trends higher for the July contracts of both, Chicago and K.C. wheat, but the higher prices may be difficult to sustain without help from outside North America. For May contracts, early Monday showed 10 delivery intentions for K.C. wheat, none for Minneapolis wheat, and still none for Chicago wheat. DTN's National SRW index closed at $4.94 Friday, down from its highest price in nine months and 33 cents below the July contract.

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

Follow Todd Hultman on Twitter @ToddHultman1

(BAS)

Copyright 2018 DTN/The Progressive Farmer. All rights reserved.