September corn closed up 10 cents per bushel and December corn was up 11 1/4 cents. August soybeans closed up 14 1/4 cents and November soybeans were up 14 1/4 cents. September KC wheat closed up 5 3/4 cents, September Chicago wheat was up 1 1/2 cents and September Minneapolis wheat was up 1 1/2 cents. The September U.S. dollar index is down 0.201 at 96.465. The Dow Jones Industrial Average is up 167.80 points at 27,255.88. August gold is up $8.60 at $1,415.30, September silver is up $0.10 at $15.25 and September copper is up $0.0080 at $2.6955. August crude oil is up $0.06 at $60.26, August heating oil is down $0.0003, August RBOB is down $0.0073 and August natural gas is up $0.048.
For the week:
September corn closed up 15 1/2 cents and December 2019 corn was up 17 cents. August soybeans were up 37 1/4 cents and November 2019 soybeans were up 37 cents. September Kansas City wheat was up 22 cents, September Chicago wheat was up 8 cents, and September Minneapolis wheat was up 9 1/2 cents.
December corn closed up 11 1/4 cents at $4.59 1/4 Friday and was up 15 1/2 cents on the week, showing again the market believes U.S. ending corn stocks will be less than Thursday's USDA estimate of 2.010 billion bushels (bb). Supporting those claims, cash corn prices in the Eastern Corn Belt where crop conditions are struggling continue to trade above the September futures contract and some premium bids are also seen in the Western Corn Belt. Corn basis expressed as a national average was 9 cents below the September contract on Thursday evening, the narrowest in six years. Here in mid-July while corn plantings and yield remain a guessing game, the forecast is turning hot and dry for much of the Corn Belt with the hotter temperatures favoring the western side. That is a quick change from the extremely wet planting season and will stress late-planted corn crops as they enter pollination time. On the demand side, U.S. corn has largely priced itself out of the export market, but the first USDA export sale announcement of July did show up on Friday. USDA said 4.1 million bushels (104,100 mt) of U.S. corn were sold to Panama for 2019-20. Clearly, there is good reason to believe U.S. ending corn stocks will be lower than 2.0 bb in 2019-20. Just how low is the question of the moment, giving corn prices a neutral- to bullish-price outlook. Technically, the trend in cash corn is up, back to challenging its highest prices in five years. DTN's National Corn Index closed at $4.35 Thursday, 9 cents below the September contract. Outside commodities were mixed with Dow Jones Industrials trading at new highs, spurred by expectations for a rate cut, possibly later this month.
November soybeans closed up 14 1/4 cents at $9.31 1/2 Friday, the fifth consecutive close higher and securing a 37-cent gain on the week. There is a chance USDA's 80.0 million acre soybean planting estimate will be adjusted higher on Aug. 12, but because crop conditions are off to a poor start in 2019, there is also room for soybean yields to be adjusted lower. For that reason, Thursday's lower ending soybean stocks estimate of 795 million bushels (mb) from USDA is not out of line and helps take some of the bearish pressure off soybean prices. The lack of trade with China remains the primary bearish concern for soybeans and there has been talk lately that China may be close to making more U.S. ag purchases, but this is not the first time we have heard that rumor. As mentioned for corn above, the forecast looks hotter and mostly dry the next ten days for much of the Midwest, a new concern for developing corn and soybean crops. Technically, the trend in cash soybeans is sideways as the market considers a less-bearish fundamental outlook. DTN's National Soybean Index closed at $8.28 Thursday, 71 cents below the August futures contract and below its highest price in a year.
September KC wheat ended up 5 3/4 cents Friday at $4.67 1/4. For the week, KC wheat was up 22 cents, helped by Thursday's 20-cent jump after USDA handed out lower ending wheat stocks estimates for both the U.S. and the world. It wasn't so much that wheat production is in serious trouble in any one region, but several of the major areas showed small to modest reductions in USDA's crop estimates. Conditions in Europe remain on the dry side. Russia's crop estimate dropped from 78.0 mmt to 74.2 mmt (2.73 bb), but Russia is still expected to be the top exporter in 2019-20, shipping out 34.5 mmt (1.27 bb). Here in the U.S., the hot and dry weather expected in the southwestern U.S. Plains is favorable for harvest progress and no big interruptions are expected. For spring wheat, crop conditions remain favorable in the U.S. and moderate showers in the forecast for the western Canadian Prairies should be helpful to crops. For U.S. producers, Thursday's lower crop estimates from USDA offered welcome relief from the market's bearish mood, but so far, production problems remain limited and USDA is still expecting a record world wheat crop and record ending wheat stocks in 2019-20. Technically, the trends for SRW, HRW and HRS wheat are all sideways. DTN's National HRW Index closed at $4.40 Thursday, down 21 cents from the September futures contract. DTN's National SRW Index closed at $5.02 Thursday, down from its highest prices in ten months.
Todd Hultman can be reached at email@example.com
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