DTN Closing Grain Comments

General Comments:

May corn closed down 3 3/4 cents per bushel and December corn was down 3 1/4 cents. May soybeans closed down 10 3/4 cents and November soybeans were down 10 cents. May Kansas City wheat closed down 10 1/4 cents, May Chicago wheat was down 14 1/2 cents and May Minneapolis wheat was down 4 1/2 cents.

The June U.S. dollar index is trading up 0.109 at 96.665. The Dow Jones Industrial Average is up 44.66 points at 26,429.43. June gold is down $13.30 at $1,278.00, May silver is down $0.04 at $14.94 and May copper is down $0.0015 at $2.9335. May crude oil is up $0.38 at $63.78, May heating oil is up $0.0153, May RBOB is up $0.0146 and May natural gas is down $0.015.

Corn:

May corn fell 3 3/4 cents to $3.59 Tuesday, influenced by larger losses in wheat and a return of gradually warmer temperatures to much of the Midwest. This week's forecast expects moderate rain amounts in the northern Corn Belt and heavy rain amounts in the southern Corn belt, most of which will move out sometime Friday. In the six- to 10-day period, most of the Corn Belt is expecting above normal precipitation and temperatures. Late Monday, USDA said 3% of the corn crop was planted, mainly in the southern states, and down from the five-year average of 5%. It is still early of course, and warmer temperatures will help, but the northern Midwest needs drier field conditions after a long winter and last week's storm. Fundamentally, USDA's estimate of 2.035 billion bushels (bb) of old-crop ending stocks suggest corn prices will stay in the same general range we have seen the past four years. The uncertainty waits in the new-crop season, and it will be interesting to see if USDA's 92.8 million acre planting estimate can survive this spring's weather. Technically, May corn continues to languish near its contract low. Cash corn prices are chopping sideways, near their one-year average at $3.38. DTN's National Corn Index closed at $3.40 Monday, priced 23 cents below the May contract. In outside markets, the June U.S. dollar index is up 0.11, staying near its highest prices in almost two years. June gold is trading down $13.30, at its lowest price in three months as investors show greater confidence about the world economy.

Soybeans:

May soybeans dropped 10 3/4 cents to $8.88 Tuesday, suffering along with the other crop prices and also pressured by a $4.50 decline in May soybean meal. With planting acres still uncertain in 2019, November soybeans are close to their March low after losing a dime to $9.21. Tuesday's weather map was mostly dry with warmer temperatures expected later in the day, but rain is forecast to return to the Midwest from Wednesday through Friday. Fundamentally speaking, the outlook for soybean prices remains bearish with record U.S. ending stocks expected for 2018-19. In addition, the export pace is not keeping up with USDA's estimate, and it wouldn't be a shock to see soybean plantings come in higher than USDA's early estimate of 84.6 million. Trade talks with China continue to sound hopeful, but the outcome remains highly uncertain and China's tariff is still in place. Technically, May soybeans remain near their lowest prices in four months, while cash prices are holding sideways, above the $8.00 national average. DTN's National Soybean Index closed at $8.15 Monday, chopping sideways and priced 84 cents below the May contract.

Wheat:

July Kansas City wheat dropped 11 cents Tuesday to a new contract low of $4.22 1/2 on slightly higher volume, a sign of how difficult it has become to find a willing buyer. July Chicago wheat showed the largest percentage loss of the day, finishing down 14 3/4 cents at $4.48 1/2. With all wheat on track for roughly 1.1 bb of U.S. ending stocks in 2018-19 and USDA repeating its assessment that 60% of U.S. winter wheat is in good-to-excellent condition, cheap prices aren't yet proving enticing enough for potential buyers. It was a bit ironic that Chicago wheat suffered such a big loss on Tuesday as USDA's ending stocks-to-use ratio for SRW wheat is actually the lowest of the three at 51%. The SRW wheat crop is also suffering excessive moisture with Michigan and Ohio showing poor-to-very poor ratings of 34% and 26%, respectively. For spring wheat, USDA said 2% of the crop has been planted, down from a five-year average of 13% for this time of year and mostly in the northwestern U.S. Outside of North America, weather concerns are minor early in 2019 with a larger crop expected for Russia, weather permitting. With ample U.S. wheat available and early crop conditions looking mostly favorable, the trends in cash prices for all three wheats are down with prices searching for support. DTN's National HRW index closed at $4.15 Monday, 12 cents under the May contract and up from its lowest prices in a year. DTN's National SRW index closed at $4.35, also up from its lowest prices in a year.

Todd Hultmancan be reached at todd.hultman@dtn.com

FollowTodd on Twitter @ToddHultman1

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