DTN Closing Grain Comments

Soybeans, Meal Lead Crop Prices Higher

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

General Comments:

Corn was up 4 1/2 cents in the December contract and up 4 1/2 cents in the July. Soybeans were up24 cents in the November contract and up 22 1/4 cents in the July. Wheat closed up 7 1/2 cents in the December Kansas City contract, up 7 3/4 cents in December Chicago and up 4 1/2 cents in the December Minneapolis contract.

The December U.S. dollar index is down 0.12 at 94.79. December gold is up $7.00 at $1,229.00 while December silver is up 7 cents and December copper is down $0.0120. The Dow Jones Industrial Average is down 2 points at 25,314. November crude oil is up $0.10 at $71.44. November heating oil is unchanged while November RBOB gasoline is down $0.0043 and November natural gas is up 0.073.

Corn:

December corn closed up 4 1/2 cents at $3.78 1/4 after a quiet start on Monday. The western Plains and central Midwest received more rain and snow over the weekend, adding to harvest challenges. The forecast is mostly dry for the central and northern Corn Belt the next two weeks, but cool to cold temperatures will slow the drying process. Meanwhile, more moderate-to-heavy rains south of Missouri and the Ohio River the next seven days will continue to make fall harvest difficult in the southern Corn Belt. Corn demand continues to see strong export activity early in 2018-19. Monday morning, USDA said 39.2 million bushels (mb) of corn were inspected for export last week, putting total inspections up 75% from a year ago. That is an impressive start for corn exports and is having a bullish impact on prices since posting a low on Sept. 18. Friday's higher close turned the trend higher in December corn, in line with its seasonal tendency. DTN's National Corn Index closed at $3.30 Friday, up from its September low and priced 43 cents below the December contract. In outside markets, the Dow Jones Industrials were roughly steady while the December U.S. dollar index was down 0.12. Most outside commodities were trading higher.

Soybeans:

November soybeans jumped up 24 cents to $8.91 1/2 Monday, their highest finish in seven weeks with quality concerns in fields that have seen too much rain and snow at harvest time. More snow and rain fell over the western Plains and central Midwest last weekend, which did not help harvest issues, but the forecast does look mostly dry for the central and northern Midwest the next two weeks. It is difficult to assess how much of the crop will be discounted and how much will be lost and that uncertainty appears to be causing the sell side of the market to pull back, at least temporarily. Monday morning, USDA said 42.5 mb of soybeans were inspected for export, putting total inspections down 35% in 2018-19 from a year ago. According to Dow Jones, the National Oilseed Processors Association said 160.8 mb of soybeans were crushed in September, a record for the month that is also up 18% from a year ago. Sources on Twitter also mentioned U.S. soybean oil stocks at the end of September totaled 1.53 billion pounds, up 18% from a year ago. According to Dow Jones and private consultant AgRural, Brazil's soybeans are 20% planted, which is a record pace for this time of year. DTN Senior Ag Meteorologist Bryce Anderson also noted in Monday's Market Weather video that early soil moisture has been adequate, and there is more rain in Brazil's forecast. Monday's higher close turned the trend up in November soybeans, in line with its seasonal tendency. DTN's National Soybean Index closed at $7.65 Friday, up from its lowest price in 11 years and priced $1.02 below the November contract, the weakest basis in at least 11 years.

Wheat:

December Kansas City wheat was quiet most the day, then rallied in the final hour to close up 7 1/2 cents at $5.31 3/4. Winter wheat planting has become more difficult the past week with heavy rains in the southwestern Plains and more landed over the weekend and in central Texas on Monday. Monday morning also saw sub-freezing temperatures in western Kansas, but knowing winter wheat often survives worse challenges than these, it is difficult to take early threats too seriously. Monday morning, USDA said 16.6 mb of wheat were inspected for export, another bearish showing that has total wheat inspections down 27% in 2018-19 from a year ago. Canada still has spring wheat harvest to finish, and it looks like the forecast will help them out with warmer temperatures and drier conditions this week. December Minneapolis wheat ended up 4 1/2 cents at $6.00 1/2, the highest close in seven weeks. For now, December contracts for all three wheats are holding in a narrow, sideways range, supported above their July lows. DTN's National HRW index closed at $4.86 Friday, up from its lowest price in two months and 38 cents below the December contract. DTN's National SRW index closed at $4.78, also up from its lowest price in two months.

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

Follow him on Twitter @ToddHultman1

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Todd Hultman