DTN Closing Grain Comments

General Comments:

Corn was down 13 cents in the July contract and down 12 1/2 cents in the December. Soybeans were down 8 3/4 cents in the July contract and down 8 3/4 cents in the November. Wheat closed down 15 cents in the July Chicago contract, down 16 3/4 cents in the July Kansas City and down 7 cents in the July Minneapolis contract.

The June U.S. dollar index is up 1.04 at 94.73. August gold is up $4.80 at $1,306.10 while July silver is up 22 cents and July copper is down $0.0350. The Dow Jones Industrial Average is down 14 points at 25,187. August crude oil is down $2.90 at $66.55. August heating oil is down $0.0279 while August RBOB gasoline is down $0.0290 and August natural gas is up $0.003.

Corn:

July corn closed fell 13 cents to $3.63 on Thursday, still pressured by favorable crop weather in June and by noncommercials with heavy net-long positions trying to get out, but also reinforcing the market's downtrend as they liquidate. Thursday's weather map shows rain in Iowa with DTN's seven-day forecast expecting more around Minnesota and Wisconsin while the rest of the Corn Belt gets lighter amounts. Thursday's U.S. Drought Monitor showed only minor changes with moderate drought still in Missouri and northeastern South Dakota. Hot temperatures from the southwestern Plains are expected to reach as far as the central and Eastern Corn Belt this weekend, a somewhat stressful threat to crops if that were to continue. U.S. corn demand continues to get some support from Brazil's dry weather, but it is not clear if old-crop exports will be able to reach USDA's new, aggressive goal of 2.3 billion bushels. Early Thursday, USDA said last week's export sales and shipments of corn totaled 36.9 million bushels (mb) and 55.3 mb respectively, neutral amounts for the week that have total shipments down 8% in 2017-18 from a year ago. Fundamentally, it is all about weather the next several months. Technically, the trends remain down for both, old-crop and new-crop corn, under bearish stress while noncommercials are caught heavily long. DTN's National Corn Index closed at $3.45 Wednesday, near its lowest price in two months and 31 cents below the July contract. In outside markets, the June U.S. dollar index is up 1.04, a delayed response to Wednesday's rate hike after the European Central Bank kept its rate unchanged.

Soybeans:

July soybeans finished down 8 3/4 cents at $9.27 1/4 Thursday, better than the 12-cent drop that came shortly after 8:30 a.m. CDT, but still its lowest close in almost two years. Market factors remain overwhelmingly bearish for soybeans. Crop conditions are favorable, but China's 25% tariff on U.S. soybeans is still a possibility, Brazil's record harvest is helping keep China away from buying U.S. soybeans, and we may find more acres in USDA's June 29 Acreage report. Checking on demand, USDA said early Thursday that last week's export sales and shipments of soybeans totaled 19.1 mb and 22.0 mb respectively, a neutral combination that kept total soybean shipments down 9% in 2017-18 from a year ago. Fundamentally, all eyes are on weather, and there is still a chance for crop problems in 2018, but no sign of them yet. Technically, the trends remain clearly lower for both old-crop and new-crop soybeans. The recent bullish inverse has disappeared from the November/March spread, indicating a bearish change in attitude among commercials. DTN's National Soybean Index closed at $8.73 Wednesday, priced 63 cents below the July contract and at its lowest price in nine months.

Wheat:

July Chicago wheat closed down 15 cents and July K.C. wheat was down 16 3/4 cents at $5.22 1/4 Thursday, putting Tuesday's unexpected jump in wheat prices in the rearview mirror while world wheat production is still likely to come in fairly high in 2018 -- 744.7 million metric tons (27.4 billion bushels) is what USDA estimated on Tuesday. With so much wheat available around the world, selling U.S. exports was tough duty in 2017-18 and will likely be again this season. Early Thursday, USDA said last week's export sales and shipments of new-crop wheat totaled 11.1 mb and 11.4 mb respectively, a bearish and uninspiring start to the 2018-19 season that has total shipments 57% lower than a year ago. Ukraine is now getting more rain, but the forecast remains light for southern Russia as crop problems remain limited so far. Technically, winter wheat prices remain in uptrends. The seasonal high for winter wheat prices typically arrives around early July, making this a suspicious time for wheats' uptrends. DTN's National SRW index closed at $4.93 Wednesday, still near its highest price in 10 months and 24 cents below the July contract. DTN's National HRW index closed at $5.27, still near its highest price in over two years.

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

Follow Todd Hultman on Twitter @ToddHultman1

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