DTN Closing Grain Comments

General Comments:

March corn closed down 1/4 cent per bushel and December corn was unchanged. March soybeans closed down 3/4 cent and November soybeans were up 1/4 cent. May K.C. wheat closed up 2 3/4 cents, May Chicago wheat was up 3/4 cent, and May Minneapolis wheat was up 6 3/4 cents. The March U.S. dollar index is trading down 0.118 at 96.345. The Dow Jones Industrial Average is up 140.10 points at 25,990.73. April gold is up $5.10 at $1,332.90, March silver is up $0.12 at $15.92 and March copper is up $0.0515 at $2.9485. April crude oil is up $0.31 at $57.27, April heating oil is down $0.0031, April RBOB is down $0.0016 and March natural gas is up $0.017.

For the week:

March corn closed up 1/2 cent and December 2019 corn was up 2 1/2 cents. March soybeans were up 2 3/4 cents while November 2019 soybeans were up 2 1/2 cents. May Kansas City wheat was down 18 1/2 cents, May Chicago wheat was down 15 1/4 cents, and May Minneapolis wheat was down 2 1/2 cents.

Corn:

March corn ended down a quarter-cent at $3.75 1/4 Friday and finished the week up a half-cent, a mild response to a week that saw a lot of new numbers thrown around. Early Friday, USDA said sales and shipments of corn over the past six weeks totaled 238.4 million and 217.2 million bushels, respectively. It was a neutral showing that put total corn export commitments up 2% in 2018-19 from a year ago. From USDA's Agricultural Outlook Forum in Arlington, Virginia, USDA estimated U.S. ending corn stocks will fall from 1.735 billion to 1.650 billion bushels in the new 2019-20 season. The estimated 14.89 billion bushel crop in 2019 is based on 92.0 million acres (ma) of plantings and a yield of 176.0 bushels an acre. Of course, these estimates are just starting points in a long conversation that is apt to change over the course of the year. With the north-central U.S. covered in snow and the forecast showing cold Midwestern temperatures at least into early March, planting still looks at least two months off, if not longer for much of the Midwest. Meanwhile, the latest seven-day forecast for Brazil and Argentina expects a broad coverage of crop-friendly rain. For now, March corn futures are holding sideways and the trend in cash corn remains up, in line with its seasonal tendency. DTN's National Corn Index closed at $3.49 Thursday, 26 cents below the March contract. Outside markets are mostly higher, while the March U.S. dollar index is trading down 0.12.

Soybeans:

May soybeans survived Friday's new numbers from USDA with just a half-cent loss at $9.23 3/4. On the week, prices were up 2 1/4 cents, while trade representatives from the U.S. and China were trying to hammer out some form of agreement. No announcements had been made at the time of this writing, but something is still possible, either later Friday or over the weekend. Early Friday, USDA said sales and shipments of soybeans over the past six weeks totaled 240.0 million and 205.4 million bushels, respectively, no significant change to the same bearish pace we saw last week. Total soybean export commitments are now down 17% in 2018-19 from a year ago, which is roughly 130 mb below USDA's estimated pace, provided no significant cancellations take place. Looking ahead to the new 2019-20 season, USDA envisions a modest reduction in ending U.S. soybean stocks, from 910 mb to 845 mb. An early crop estimate of 4.175 bb is based on 85.0 million acres of plantings and a yield of 49.5 bushels per acre. Total demand was set at 4.26 bb, slightly below 4.297 bb seen in 2017-18. The average farm-price estimate of $8.80 is suspiciously high (see "What If Trade Talks Succeed?" in Friday's DTN). For now, both May and cash soybean prices remain in sideways ranges, waiting for any news on trade progress with China. DTN's National Soybean Index closed at $8.26 Thursday, staying in a sideways range and $0.85 below the March futures contract.

Wheat:

May K.C. wheat closed up 2 3/4 cents at $4.66 Friday, but finished the week down 18 1/2 cents. So far, February has not been kind to winter wheat prices and even though the day's trade showed a modest gain, there was not much in Friday's numbers to help support prices. USDA said sales and shipments of wheat over the past six weeks totaled 131.4 million and 93.3 million bushels, respectively, putting total export commitments close to USDA's estimated pace. USDA's view of the new-crop season is not much different from the current one with 944 million bushels of ending wheat stocks expected in the U.S., coming from a 1.902 bb crop. The all-wheat planting estimate of 47.0 ma is not far above the record low of 46.1 ma, set in 2017-18. On Thursday, the International Grains Council said it expects increased world wheat production in 2019-20, but roughly steady ending wheat stocks, as a result of higher consumption. Friday's bullish surprise emerged in March Minneapolis wheat as it closed up 9 cents on an otherwise quiet day, likely related to concerns about winter conditions in the northwestern U.S. Plains. The trends are down for cash SRW and HRW wheat prices, while commercial support is helping the trend stay sideways for cash HRS wheat. DTN's National HRW Index closed at $4.36 Thursday, near its lowest price in five months and down 19 cents from the March futures contract. DTN's National SRW Index closed at $4.62 Thursday, holding above important support at $4.50.

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

Follow him on Twitter @ToddHultman

(CZ)

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