DTN Closing Grain Comments

General Comments:

Corn was up 9 1/2 cents in the December contract and up 9 cents in the July. Soybeans were up 12 1/4 cents in the November contract and up 11 1/4 cents in the July. Wheat closed up 1/2 cent in the December Chicago contract, up 1/4 cent in the December Kansas City and up 4 3/4 cents in the December Minneapolis contract. The September U.S. dollar index is .193 higher at 94.930. December gold is $3.10/ounce lower at $1,193.10/ounce while December silver is .177 cents lower and December copper is .0175 lower. The Dow Jones Industrial Average is up 217.61 points at 26,675.92. October crude oil is up $2.40/barrel at $75.46/barrel and December natural gas is .094 higher.

Corn:

Speculative buying interest was behind Monday's move, which saw corn prices end higher, recouping Friday's losses but falling short of a test of last week's high. The December contract ended 9 1/2 cents higher at $3.65 3/4/bu, ending near the top of the day's trading range, while closing above the 50% retracement of the move from the contract's July high to September low. This could lead to a further push to the 61.8% retracement at $3.71/bu. Weekly export inspections were bullish for corn prices, with last week's volumes inspected totaling 52.9 mb, up from 33.6 mb in the same week of 2017/18. Cumulative inspections are up 47% from the same time last crop year, far ahead of the 1% drop currently forecast by the USDA. Prospects for harvest in the Midwest are looking poor for this week, with DTN's Market Weather Factors bullish for corn prices overall; the biggest challenges are in the western and northern Midwest. DTN's National Average Corn Basis was unchanged over the past week at 44 cents under the December, leaving the National Corn Index at $3.13/bu as of Friday's close.

Soybeans:

Soybeans ended Monday's session with double-digit gains, despite bearish data Friday, bearish export inspection data reported on Monday and a stronger U.S. Dollar trade. The November ended 12 1/4 cents higher at $8.57 3/4/bu, with a combination of supportive commercial and noncommercial activity behind the move. Monday's high tested the contract's 50-day moving average for the first time since late August, although failed to sustain this move above $8.62 1/2/bu. Weekly export inspections were bearish for soybeans, 21.7 mb compared to the 33 mb for the same week last crop year. Year-to-date, inspected volumes are 26% below the volume reported for the same period last crop year, which compares to the 3% year-over-year drop forecast by the USDA. While harvest delays will also affect the Midwest crop, DTN's Market Weather Factors were neutral for soybeans overall, with central Brazil receiving favorable moisture ahead of planting or to support crop development for planted crops. DTN's National Average Soybean Basis strengthened 1 cent to $1.02/bu under the November contract over the past week, leaving the National Soybean Index at $7.44/bu.

Wheat:

Wheat futures closed higher Monday, but failed to follow the more robust move seen in row crops. December MGEX spring wheat ended 4 3/4 cents higher, December Chicago wheat closed 1/2 cent higher and December K.C. wheat ended 1/4 cent higher. Both K.C. and Chicago wheat finished higher for the first time in five sessions, while ending near the midpoint of Monday's trading range with only modest gains, which will not be convincing. All three wheat markets are struggling with their respective 20-day moving averages, which are in a gentle downtrend. Weekly export inspections continue to be bearish for wheat prices, with a reported 13.6 mb inspected over the past week, down from 27.2 mb reported for the same week last marketing year. Cumulative inspections are down 31% from the same period last year, well-behind the 14% increase forecast by the USDA. Northern Plains wheat growers will be pleased that text from the USMCA trade deal with Canada and Mexico includes Canada's commitment to grade U.S. wheat "no less favorable than it accords Canadian wheat," which may allow for a two-way flow along the border over time. DTN's National Average HRW Basis strengthened 2 cents over the past week to 39 cents under the December, with the DTN National Hard Red Winter Index ending at $4.72/bu on Friday. The National Average Soft Red Winter Basis strengthened 2 cents over the past week to 43 cents under the December, leaving the National Soft Red Winter Index at $4.66/but on Friday. The National Average Spring Wheat Basis strengthened 2 cents over the past week to 61 cents under the December contract, with the DTN National Hard Red Spring Index ending at $5.12/bu.

Cliff Jamieson can be reached at cliff.jamieson@dtn.com

(CZ)

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