DTN Closing Grain Comments

General Comments:

September corn closed up 17 3/4 cents per bushel and December corn was up 15 1/4 cents. August soybeans closed up 10 cents and November soybeans were up 10 cents. September KC wheat closed up 11 1/4 cents, September Chicago wheat was up 10 3/4 cents and September Minneapolis wheat was up 3 3/4 cents. The September U.S. dollar index is trading up 0.036 at 96.310. The Dow Jones Industrial Average is up 179.32 points at 26,966.00. August gold is up $11.90 at $1,419.90, September silver is up $0.10 at $15.34 and September copper is up $0.0195 at $2.6835. August crude oil is up $0.77 at $57.02, August heating oil is up $0.0187, August RBOB is up $0.0490 and August natural gas is up $0.040.

Corn:

December corn got an early start on Thursday's fireworks with a 15 1/4 cent gain to finish at $4.41 1/4, a second day higher. It is fair to say the market is starting to push back on Friday's higher-than-expected planting estimate of 91.7 million acres from USDA. Trading volume was lower on the day, which is not unusual given Wednesday's shorter trading session and customary lack of trade ahead of holidays. In prior years, we would be hearing about shoulder high corn by now and start guessing yields after the June planting estimate, but in 2019, the variety of crop conditions is widely different throughout the Corn Belt and that planting estimate is going to have to wait until at least Aug. 12. The uncertainty of this year's corn crop sets the market up for volatile and possibly choppy trading this summer and it may be difficult for noncommercials to become too confident about either being long or short the corn market. The northwestern Corn Belt is expecting heavy rain the next seven days while the Eastern Corn Belt has lighter amounts. Fundamentally, the outlook for corn prices remains neutral to bullish with a wide range of uncertainty. Technically, the trend in cash corn has turned sideways after hitting the highest prices in five years. DTN's National Corn Index closed at $4.03 Tuesday, 16 cents below the September contract. In outside markets, Dow Jones Industrials are up 179 points with talk of a possible rate cut later this month.

Soybeans:

November soybeans closed up 10 cents at $9.08 3/4 Wednesday, helped by the low-volume rally in corn on a day when trade is usually lifeless. Similar to corn, it is difficult to assess how many soybean acres were planted in 2019, but it would not be a surprise to see USDA lower its 49.5 bushel per acre yield estimate, informed by the lowest good-to-excellent crop rating in seven years. In general, the higher crop conditions are in the western Midwest and poorer conditions in the eastern Midwest. The seven-day forecast is giving crops in the eastern region a break with light to moderate rain amounts expected, while the heavier amounts are headed for the Western Corn Belt, reaching as far south as northern Kansas. With the state of the soybean crop so uncertain in 2019, commercial and noncommercial traders are positioned roughly neutral and that is likely helping prices from falling under the weight of other bearish concerns. Lack of trade with China remains the primary bearish concern for soybeans. Technically, the trend is back to sideways in cash soybeans as prices have been unable to trade above their one-year high at $8.41. DTN's National Soybean Index closed at $8.04 Tuesday, 75 cents below the August contract.

Wheat:

September KC wheat broke its string of four consecutive losses, taking advantage of Wednesday's rally in corn to gain back 11 1/4 cents to $4.43 3/4. Similarly, September Chicago wheat was up 10 3/4 cents at $5.14. Winter wheat harvest is currently underway and the seven-day forecast looks more helpful with a dry forecast for the southwestern U.S. Plains and only light to moderate amounts expected in the eastern Midwest. Anecdotal reports are mixed, finding high yields and good quality in many areas, but also fields damaged by too much rain in others. Overall however, there is a risk USDA's crop estimate for HRW wheat could be increased on July 11. September Minneapolis wheat ended up 3 3/4 cents Wednesday, a modest break from the recent selling. High good-to-excellent crop ratings for spring wheat in the U.S. plus some moisture improvement in the western Canadian Prairie is keeping spring wheat prices under bearish pressure. As long as world wheat production appears to be doing well, it is difficult to expect higher wheat prices in 2019. Weather will still need to be monitored, however as surprises are always possible. Technically, the trend is currently sideways for cash SRW wheat and down for HRW and HRS wheats. DTN's National HRW Index closed at $4.11 Tuesday, 22 cents below the September contract. DTN's National SRW Index closed at $4.86, down from its highest prices in four years. U.S. grain and livestock futures resume trading at 8:30 a.m. Friday.

Have a safe and enjoyable Independence Day.

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

Follow him on Twitter @ToddHultman1

(CZ)

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