DTN Closing Grain Comments

General Comments:

Corn was down 7 1/2 cents in the July contract and down 7 1/4 cents in the December. Soybeans were down 6 1/4 cents in the July contract and down 5 1/2 cents in the November. Wheat closed down 5 cents in the September Chicago contract, down 6 1/4 cents in the September Kansas City and down 3 3/4 cents in the September Minneapolis contract.

The September U.S. dollar index is down 0.01 at 94.96. August gold is down $8.00 at $1,248.10, while July silver is down 24 cents and July copper is down $0.0355. The Dow Jones Industrial Average is up 90 points at 24,207. August crude oil is up $0.59 at $73.35. August heating oil is down $0.0080, while August RBOB gasoline is down $0.0074 and August natural gas is down 0.042.

Corn:

December corn ended down 7 1/2 cents at $3.66 Thursday, breaking its narrow range in the final minutes of trading before Friday's Acreage and Grain Stocks estimates from USDA. It is common for this June pair of reports to spark big price reactions after the numbers are released, but given the substantial drops that corn and soybeans have already seen in June, it is fair to wonder if this year's response will be muted. Dow Jones' survey expects USDA to estimate 88.4 million planted corn acres and 5.26 billion bushels in storage as of June 1. I suspect the stocks estimate is more prone to surprise, given the difficulties measuring demand. Flooded fields are becoming more of a problem these days, especially in the northwestern and north-central Corn Belt, and, unfortunately for those producers, more rain is in the seven-day forecast for those areas. The rest of the Corn Belt will be drier with temperatures stretching into the 90s. Thursday's U.S. Drought Monitor showed some moisture improvement in Kansas and loss in Missouri, but too much rain is the new threat in the Corn Belt. Early Thursday, USDA said last week's export sales and shipments of corn totaled 33.5 and 58.3 million bushels respectively, a neutral showing that has total U.S. corn shipments down 6% in 2017-18 with just over two months left in the season. For now, the trend remains down for corn while last Tuesday's low is holding short-term support. DTN's National Corn Index closed at $3.25 Wednesday, near its lowest price in five months and 36 cents below the September contract. In outside markets, the September U.S. dollar index is quiet, trading down 0.01 after the U.S. Commerce Department said real GDP was up 2.8% in the first quarter from a year ago, slightly less than May's estimate. August crude oil is higher for a third day, trading up 59 cents.

Soybeans:

November soybeans fell 5 1/2 cents to $8.83 1/2 Thursday, sagging in the final minutes and likely anticipating Friday's USDA reports while there was little outside news to move markets. Dow Jones's survey expects USDA to estimate 89.8 million planted acres of soybeans and 1.22 billion bushels of soybeans in storage, as of June 1. The planting estimate should be close, but the grain stocks estimate is always tricky in June, as demand is a difficult measure any year, let alone in this year of trade turmoil. On the production side, more rain in the forecast for the north-central Midwest is a bullish concern, but flooding problems are going to have to get more serious before they get traders' attention. On the demand side, Thursday's export sales report was neutral for soybeans after USDA reported 13.2 million bushels of soybean sales and 18.4 million bushels of shipments for last week. Total shipments are now down 7% in 2017-18 from a year ago and are within reach of USDA's export estimate. Technically, the trend remains down for soybeans with the Nov/Mar futures spread showing no sign yet of commercial buying interest near the lowest November prices in over two years. DTN's National Soybean Index closed at $8.08 Wednesday, at its lowest price in over two years and priced 65 cents below the August contract.

Wheat:

September Chicago wheat closed down a nickel and September K.C. wheat was down 6 1/4 cents at $4.72 Thursday, a day of generally quiet trading in grains. September Chicago wheat has managed to stay above its three-month low of $4.75 3/4 this week, while September K.C. wheat broke its three-month low on Monday and has stayed down since. The main bearish problem for wheat prices continues to be that there is plenty of it around the world, and this year's production is on track for just a small decline from last year's record global crop. Lots of wheat also depresses U.S. exports and discourages potential buyers -- all of which reinforces the bearish price spiral. Speaking of poor exports, USDA said last week's export sales and shipments of wheat totaled 20.7 and 13.1 million bushels respectively, putting total wheat shipments down 50% from a year ago in its first month of 2018-19. Friday's USDA reports are expected to estimate U.S. wheat plantings at 47.1 million acres and June 1 wheat stocks at 1.098 billion bushels -- a lot of wheat to start the new season. Dry conditions and hot temperatures remain concerns in southern Russia, but with plenty of wheat expected at the end of 2018-19, the trends for all three wheat futures remain down. DTN's National SRW index closed at $4.58 Wednesday, up from its lowest price in two months and 30 cents below the September contract. DTN's National HRW index closed at $4.59, near its lowest price in two months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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