DTN Closing Grain Comments

Corn, Soybeans Trade Higher for Second Day

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

Corn was up 6 3/4 cents in the December contract and up 6 cents in the July. Soybeans were up 20 1/4 cents in the November contract and up 19 1/2 cents in the July. Wheat closed up 1 1/2 cents in the December Chicago contract, up 3/4 cent in the December Kansas City, and up 1/2 cent in the December Minneapolis contract.

The December U.S. dollar index is down 0.57 at 93.55. December gold is up $2.10 at $1,210.40 while December silver is up 1 cent and December copper is up $0.0110. The Dow Jones Industrial Average is up 255 points at 26,661. November crude oil is down $0.66 at $70.11. November heating oil is down $0.0194 while November RBOB gasoline is down $0.0084 and November natural gas is up 0.075.

Corn:

After a bearish month and a half, December corn prices showed some life Thursday, finishing up 6 3/4 cents at $3.52 1/2 after northern Iowa and southern Minnesota got hit with heavy rain and USDA reported bullish export sales news. Early Thursday, USDA said last week's export sales and shipments of corn totaled 54.5 million bushels (mb) and 42.4 mb respectively, a bullish combination that has total commitments up 50% from a year ago early in 2018-19. USDA later added 6.3 mb (160,020 metric tons) of U.S. corn were sold to Mexico for 2018-19. Until Thursday, the focus had been on how large the upcoming crop is, but the heavy rain, threat of flooding, and bullish export sales put shorts on their heels, at least for the day and left Tuesday's low as a possible candidate for being this year's seasonal low. Even so, cash corn prices remain under harvest pressure with some new questions about possible crop damage. DTN's National Corn Index closed at $3.01 Wednesday, not far from its 2017 low and priced 44 cents below the December contract. In outside markets, the December U.S. dollar index is down 0.57, an odd direction for a day in which the S&P 500 is trading at a new high.

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Soybeans:

November soybeans closed up 20 1/4 cents at $8.50 1/4 Thursday, also showing concerns about ill-timed heavy rains around northern Iowa, but without the bullish export news that corn received. Heavy rain amounts fell over roughly one-third of Iowa's row crop production and possibly as much as a third of Minnesota's production the past 24 hours, adding to flooding concerns and creating potential for crop damage just as growers are getting ready for harvest. Assessing actual damage will be difficult, but just the concern is enough to encourage soybean bears to bid prices higher as they run for cover. On the export front, the trade dispute with China continues to impact USDA's weekly numbers. USDA said last week's export sales and shipments of soybeans totaled 33.7 mb and 29.4 mb, putting total commitments down 7% from a year ago after almost two weeks in 2018-19. Mexico and Indonesia were last week's top buyers. Much of Thursday's higher prices was likely due to short-covering, but also successfully interrupted the bearish momentum of harvest focus, leaving this week's low as a candidate for this year's seasonal low. DTN's National Soybean Index closed at $7.27 Wednesday, at its lowest price in 11 years and priced $1.03 below the November contract, the weakest basis in at least 11 years.

Wheat:

December Chicago wheat ended up 1 1/2 cents at $5.24, holding firm in quiet trading and not participating in Thursday's unexpected rallies in corn and soybeans. Winter wheat planting is likely making good progress in the southwestern Plains, but may have to wait out some heavy rains the next two days. Thursday's latest U.S. Drought Monitor showed again that parts of winter wheat country are still dealing with drought, but there's been much improvement from the drier conditions experienced earlier this year. USDA is predicting the U.S. will see a 14% increase in wheat exports in 2018-19, but there is no evidence of that happening yet. USDA said early Thursday last week's export sales and shipments of wheat totaled 17.2 mb and 11.6 mb respectively, keeping total wheat shipments down 31% in 2018-19 from a year ago. Even so, December wheat prices are holding in a sideways range with some support coming from a dry planting start in Europe and Russia. DTN's National SRW index closed at $4.76 Wednesday, 47 cents below the December contract and up from its lowest price in two months. DTN's National HRW index closed at $4.85 Wednesday, also up from 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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Todd Hultman