DTN Closing Grain Comments

Corn Edges Higher; Other Crops Mixed

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN illustration by Nick Scalise)

General Comments:

September corn closed up 3 1/4 cents and December corn closed up 4 3/4 cents. August soybeans closed down 2 1/2 cents and November soybeans were down 2 cents. September KC wheat closed up 2 1/4 cents, September Chicago wheat was unchanged and September Minneapolis wheat was down 3/4 cent. The September U.S. dollar index is trading up .47 at 97.41. The Dow Jones Industrial Average is up 148.33 points at 27,320.23. December gold is down $8.10 at $1,431.60, September silver is up $0.02 at $16.44 and September copper is down $0.0185. September crude oil is up $0.44 at $56.66, September heating oil is up $0.0187, September RBOB gasoline is up $0.0223 and September natural gas is down $0.009.

Corn:

December corn gained back 4 3/4 cents to $4.31 1/2 Tuesday, finding some support after corn's crop rating slipped slightly from last week. USDA said 57% of corn was rated good to excellent late Monday, down one percentage point from the previous week and still the lowest score since the drought of 2012. Crops are slowly reaching silking stage, now 35% nationally. Minnesota is a concern with only 21% of crops silking so far. The highest poor-to-very poor ratings are in the eastern Midwest, Missouri and North Carolina. Nebraska and North Dakota are on the other end of the spectrum, sporting the highest good-to-excellent ratings. Estimating crop size for corn remains a difficult task without a credible planting estimate, but a 2019 crop in the low 13 billion bushel (bb) range seems reasonable in this highly uncertain atmosphere and translates very loosely to a $4.50 cash price. There are still plenty of blanks yet to fill in, but for now, the fundamental outlook for prices remains roughly neutral with a bullish possibility still on the table. Technically, the trend in cash corn is sideways and choppy in this uncertain environment. DTN's National Corn Index closed at $4.15 Monday, 7 cents below the September contract and down from its five-year high. In outside markets, Dow Jones Industrials are up 148 points and the September U.S. dollar index is up 0.47 after lawmakers reached an agreement to suspend the U.S. debt ceiling for two years.

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Soybeans:

November soybeans closed down 2 cents at $9.03 3/4 Tuesday as traders apparently found nothing in Monday's Crop Progress update to spark buying interest. USDA said 54% of the soybean crop is still good to excellent, the same as a week ago and the lowest in seven years. Forty percent of soybeans are blooming and 7% are setting pods, mainly in the southern states. As with corn, the biggest crop problems are in Missouri and the eastern Midwest, while Tennessee and Nebraska post the highest good-to-excellent ratings. The likelihood of a smaller soybean crop in 2019 is helping November soybean prices stay near their 100-day average and well above this year's low of $8.15 1/2. However, trading higher from here is difficult without some kind of trade improvement with China. The good news is that the two sides are still speaking, but there hasn't been any evidence of change yet. In this uncertain market environment with no movement on trade, November soybean prices seem content to chop sideways and remain limited by bearish pressure. Technically, the trend is sideways in cash soybeans with support around $7.85. DTN's National Soybean Index closed at $8.19 Monday, down from a new one-year high and 69 cents below the August contract.

Wheat:

September KC wheat ended up 2 1/4 cents at $4.31 1/2 with prices so quiet it looked like wheat traders took the day off. September Minneapolis wheat was also quiet, ending down 3/4 cent as the Wheat Quality Council's Spring Wheat Tour got under way, inspecting the fields of North Dakota and northern South Dakota. Except for some pest and disease concerns, the tour is likely to find fields of good-looking spring wheat this year as USDA gave spring wheat a 76% good-to-excellent rating late Monday. Harvest is also getting closer with 92% of the crop headed. In the western Canadian Prairies, there are beneficial rains in this week's forecast, but southern Saskatchewan is one area that keeps getting missed. For winter wheat, USDA said 69% of the crop was harvested, slowly making its way north with help from a mostly dry forecast this week. Outside of North America, high temperatures return to France this week, but French wheat prices were slightly lower Tuesday with rain expected by the weekend. The fundamental outlook for wheat prices remains bearish with most of the world's wheat regions doing well enough. Technically, the trend is currently sideways for SRW and HRS wheat with prices near support. For HRW wheat, the trend is down, but suspect in light trade. DTN's National HRW Index closed at $4.07 Monday, 22 cents below the September contract. DTN's National SRW Index closed at $4.69, down from its highest price in four years.

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

Follow him on Twitter @ToddHultman1

(CZ)

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Todd Hultman