DTN Closing Grain Comments

General Comments:

March corn was down 2 1/2 cents and July corn was down 2 3/4 cents. January soybeans were down 18 3/4 cents and July soybeans were down 17 1/2 cents. March Kansas City wheat closed up 3 3/4 cents, March Chicago wheat was up 6 3/4 cents, and March Minneapolis wheat was up 3/4 cent.

The December U.S. dollar index is up 0.11 at 96.93. December gold is down $0.40 at $1,222.80 while December silver is down 1 cent and December copper is down $0.0130. The Dow Jones Industrial Average is up 300 points at 24,586. January crude oil is up $1.34 at $51.76. January heating oil is up $0.0291 while January RBOB gasoline is up $0.0595 and January natural gas is down $0.101.

Corn:

March corn ended down 2 1/2 cents at $3.68 Monday on higher volume, likely involving noncommercial liquidation as prices have now given back over half of their September-October rally. Monday afternoon's Crop Progress report is likely to show decent harvest progress as last week's weather was mostly favorable before winter storms arrived over the weekend. A few more days of dry weather are expected before moderate to heavy precipitation returns to the southeastern Midwest on Thursday. Earlier Monday, USDA said 44.0 million bushels of corn were inspected for export last week, keeping the total up 80% in 2018-19 from a year ago. In South America, the latest reports from Dow Jones show Brazil's first corn crop 97% planted and Argentina's corn crop 37% planted, both enjoying mostly favorable crop conditions. In spite of the recent sag in corn prices, the trend remains sideways during this quieter time of year. DTN's National Corn Index closed at $3.28 Friday, well above its September low of $3.00 and priced 31 cents below the December contract. In outside markets, the December U.S. dollar index is up 0.11 and other commodities are mixed.

Soybeans:

January soybeans fell 18 3/4 cents to $8.62 1/4 Monday, posting the lowest close in November as traders show nervousness about whether the U.S. and China will make any real progress toward a trade deal at Friday's G20 meeting in Buenos Aires. Technically, Monday's drop was the most bearish move soybean prices have made since President Trump said trade discussions with China were moving along nicely in a tweet on Nov. 1. Monday's Crop Progress report from USDA is likely to show harvest problems again in Arkansas and Missouri where conditions have been excessively wet. The area had drier weather last week, but more moderate-to-heavy precipitation is coming in the seven-day forecast. On the demand side, things are going to look bleak this week, if there's no trade progress made with China. USDA said 40.6 million bushels of U.S. soybeans were inspected for export last week, putting total inspections down 42% in 2018-19 from a year ago. In spite of all the uncertainty over trade, the trend in soybeans remains sideways and there has been modest basis improvement. DTN's National Soybean Index closed at $7.92 Friday, priced $0.89 below the January contract and still above the September low of $7.12. CFTC's weekly Commitment of Traders report will be released later Monday afternoon due to last week's holiday.

Wheat:

March K.C. wheat ended up 3 3/4 cents at $4.89 3/4 Monday, getting a small lift from news that Russia seized three Ukrainian naval ships in waters near Crimea that were supposed to be open to both countries. This seems to be a classic case of Russia threatening further expansion toward the ports of eastern Ukraine and testing what they might get away with. It is difficult to tell whether this issue will escalate enough to actually hinder wheat trade in the region, but it does give short-sellers in wheat reason to pause. Earlier Monday, USDA said just 9.3 million bushels of wheat were inspected for export last week, a small amount that put total inspections down 19% from a year ago. USDA also confirmed last week's news that 4.4 million bushels (120,000 metric tons) of U.S. SRW wheat was sold to Egypt for 2018-19. The sale gave a little hope that more business may be on the way, but so far, the export pace projects far below USDA's estimate. As the Northern Hemisphere heads to dormancy, cash SRW wheat and spring wheat prices continue to trend sideways, while the trend in cash HRW wheat has turned lower. DTN's National HRW index closed at $4.37 Friday, 28 cents below the December contract and below former support at $4.50. DTN's National SRW index closed at $4.68 Friday and is still above its support.

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

Follow him on Twitter @ToddHultman1

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