DTN Early Word Grains

6:00 a.m. CME Globex:

March corn is down 1/2 cent, March soybeans are down 5 3/4 cents, and March K.C. wheat is down 2 1/2 cents.

CME Globex Recap:

European stock markets and the Dow Jones futures were lower early Monday, pressured by concerns about the ongoing shutdown of the federal government and news that China's exports were down 4.4% in December from a year ago. Monday's start has investors in risk-off mode as nearly all commodities are also trading lower, including grains.

OUTSIDE MARKETS:

Previous closes on Friday showed the Dow Jones Industrial Average down 5.97 at 23,995.95 and the S&P 500 down 0.38 at 2,596.26 while the 10-yr Treasury yield ended at 2.70%. Early Monday, DJIA futures are down 214 points. Asian markets are lower with Japan's Nikkei 225 closed Monday and China's Shanghai Composite down 18 points (-0.7%). European markets are lower with London's FTSE 100 down 69.45 points (-1.0%), Germany's DAX down 79.94 points (-0.7%), and France's CAC 40 down 43.72 points (-0.9%). The March euro was steady at 1.152 and the March U.S. dollar index was down 0.02 at 95.25. March 30-year T-Bonds were up 17/32nds while February gold was up $5.90 at $1295.40 and February crude oil was down $0.83 at $50.76. Soybeans on China's Dalian Exchange are down 0.5% while soymeal is down 2.0%.

	BULL		BEAR
1)	Once again, the seven-day forecast remains hot and mostly dry for southern Brazil, still stressful to crop conditions.	1)	Investors are starting on the defensive Monday with concerns about a slowing world economy and negative impact from the ongoing government shutdown.
2)	Safras & Mercado put out a low soybean crop estimate of 115.7 million metric tons (mmt) for Brazil (4.25 bb) on Friday.	2)	The uncertainty of trade talks with China keeps and extremely bearish fundamental scenario within the realm of possibility for soybeans.
3)	Economic concerns are helping keep the U.S. Dollar Index down from its highs in December.	3)	In spite of weather concerns in South America, crop estimates have shown modest reductions, so far.

MORE COMMODITY-SPECIFIC COMMENTS

CORN March corn is down 1/2 cent early Monday, not much of a change for a commodity board that is nearly all red to start the week. While corn futures have held sideways the past three months, cash corn prices are near their highest level in seven months and reflecting their seasonal tendency to trade higher into early June. The latest seven-day forecast for southern Brazil remains hot and mostly dry, which is a threat not only to their current corn crops, but also the second planting that will occur. Technically the trend in cash corn remains up for now.

SOYBEANS March soybeans are down 5 3/4 cents early, pressured by investor defensiveness across Monday's whole commodity board and also by news that China's exports were down 4.4% in December from a year ago. That news may actually be a mixed bag for soybeans as it adds to concerns the world economy appears to be slowing, but it could also be one of the reasons why China appears to be more willing to negotiate trade terms with the U.S. The outcome of trade talks with China, which are supposed to be done by March 1, could be the largest deciding factor for soybean prices in 2019. While the fate of trade talks remains unclear, the forecast for southern Brazil remains hot and on the dry side for the week ahead -- a factor of support for soybean prices.

WHEAT March K.C. wheat is down 2 1/2 cents early influenced by Monday's mostly red commodity board and ongoing concerns that U.S. wheat exports are not going very well in 2018-19. It has been over three weeks since USDA has published export data and there is no sign yet of lawmakers reaching an agreement to open the government again. We can't say for sure, but it seems likely that wheat won't have much in the way of sales to show whenever export sales are published again and that is a bearish concern for U.S. prices. On the other hand, we are in the dormant time of year for the Northern Hemisphere and have a whole season of new production and weather risk to look forward to, later in 2019. For now, March K.C. wheat is holding sideways since posting a low of $4.82 1/4 in November.

	DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.45	$0.02	-$0.33	Mar	-$0.001
Soybeans:	$8.19	$0.03	-$0.92	Mar	-$0.001
SRW Wheat:	$4.94	$0.06	-$0.26	Mar	-$0.002
HRW Wheat:	$4.79	$0.06	-$0.25	Mar	$0.005
HRS Wheat:	$5.32	$0.07	-$0.38	Mar	$0.006

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

Toddcan be followed throughout the day on Twitter @ToddHultman1

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