DTN Closing Grain Comments

General Comments:

July corn closed up 1 cent per bushel and December corn was up 2 1/4 cents. July soybeans closed up 2 3/4 cents and November soybeans were up 3 cents. July KC wheat closed down 18 1/4 cents, July Chicago wheat was down 12 1/2 cents and July Minneapolis wheat was down 3 cents.

The June U.S. dollar index is trading down 0.090 at 96.970. The Dow Jones Industrial Average is up 430.66 points at 25,250.44. August gold is up $3.20 at $1,331.10, July silver is up $0.07 at $14.81 and July copper is up $0.0190 at $2.6690. July crude oil is up $0.23 at $53.48, July heating oil is up $0.0155, July RBOB is down $0.0143 and July natural gas is up $0.016.

Corn:

July corn closed up a penny at $4.25 1/4 Tuesday, given slight support by USDA's report that 67% of corn was planted and 46% was emerged as of June 2. The progress was less than expected and the lowest since at least 1995 when 80% was planted by June 4. Estimating corn production in 2019 continues to be more difficult than usual and there may have to be another planting survey after USDA's June 28 acreage estimate to get an accurate assessment of late plantings. Tuesday's seven-day forecast expects heavy rains in the southeastern quadrant of the U.S., including some of the wettest parts of the Corn Belt. The northwestern Corn Belt has lighter rain amounts expected, except for a wetter forecast for Minnesota. As it stands in early June, corn planting is below the 50% mark in Indiana, Ohio, Illinois, South Dakota and Michigan. Fundamentally, the outlook for corn prices is neutral to bullish in the current situation with a wide range of uncertainty keeping traders on their heels. Technically, the trend of cash corn prices remains up, while traders try to get a handle on estimating 2019 production. DTN's National Corn Index closed at $3.97 Monday, priced 27 cents below the July contract and near its highest level in four years. In outside markets, Dow Jones Industrials are up 431 points with increased talk that the Federal Reserve may cut interest rates in 2019 as a way of compensating for trade tensions.

Soybeans:

July soybeans ended up 2 3/4 cents at $8.81 3/4 Tuesday, a modest gain after USDA said 39% of soybeans were planted and 19% were emerged as of June 2. That is also the slowest planting pace for soybeans in USDA's archive dating back to 1995. In the case of soybeans, there is time to plant, but weather is going to need to be more cooperative than it has been and so far, the seven-day forecast is not very encouraging. Outside of planting difficulties the outlook for soybeans still looks heavily bearish with U.S. exports dragging and U.S. ending soybean stocks aimed above one billion bushels in 2018-19. The fact that China holds a 25% tariff on U.S. soybeans and the two sides haven't resumed talks yet also makes it difficult for anyone to believe in significantly higher U.S. soybean prices. Fundamentally, the bearish outlook for soybean prices remains dominant, temporarily muddied by planting difficulties. Technically, last Wednesday's higher close changed the trend in soybeans to sideways reflecting uncertain planting conditions and crop season ahead. DTN's National Soybean Index closed at $7.97 Monday, priced 82 cents below the July contract and up sharply from its lowest prices in 12 years.

Wheat:

Monday's rally in winter wheat was quickly extinguished on Tuesday as July KC wheat dropped 18 1/4 cents to $4.68 1/2, posting an outside bearish reversal for the day. Part of Tuesday's selling may have been related to a seven-day forecast that now has more moderate amounts in Kansas and Oklahoma where flooding has been a problem lately. Heavy rain amounts are still headed for the southeastern U.S. and SRW wheat areas. USDA said late Monday that 64% of winter wheat was rated good-to-excellent, up from 61% a week ago. The ratings are high and probably deserved in the northwestern U.S., but the moderately high ratings of 57% in Kansas and 64% in Oklahoma could be masking some problems related to too much moisture. USDA also said 83% of the spring wheat crop is rated good-to-excellent, an odd finding given only 69% of the crop has emerged. Outside of the U.S., the western Canadian Prairies are expecting helpful rains this weekend and world crop conditions are generally favorable with some limited concerns of dryness. Technically, the trend is currently up for all three U.S. wheats, but Tuesday's peak of $4.97 in July KC wheat is a sign of resistance. DTN's National HRW index closed at $4.68 Monday, up sharply from its lowest close in over a year and 17 cents below the July contract. DTN's National SRW index closed at $4.82, near its highest prices in three months.

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

Follow Todd Hultman on Twitter @ToddHultman1

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