DTN Before The Bell Grain Comments

Grains Mixed, U.S. Dollar Steps Higher

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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(DTN photo by Greg Horstmeier)

Morning CME Globex Update:

March corn was unchanged, January soybeans were up 2 1/2 cents, and March Chicago wheat was down 1 cent. Soybeans were higher early Monday while corn was steady and wheat was lower, pressured by a large number of delivery intentions on first notice day. The U.S. dollar index continues to trade higher.

Other Markets:

Dow Jones: Higher
U.S. Dollar Index: Higher
Gold: Higher
Crude Oil: Higher

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Corn:

March corn was steady early Monday with rain, snow, and ice over the central Plains, making travel difficult in areas. DTN's five-day forecast expects clearer weather after Wednesday. This is a quiet time of year for trading in corn and prices are lower than usual with bearish pressure coming from a rising U.S. dollar that is hurting export activity. March corn continues to trade at the lower end of its sideways range with support coming mainly from a reluctance of farmer-selling at these prices. DTN's National Corn Index closed at $3.39 Friday, below the 200-day average and priced 28 cents below the March contract. In outside markets, the U.S. dollar index is up .14 with many expecting more easing from the European Central Bank on Thursday. There were no deliveries of December corn reported early Monday.

Soybeans:

January soybeans were moderately higher even though Mato Grosso received beneficial rain over the weekend and has more chances this week. Soybean prices made an unexpected outside weekly reversal last week and it will be interesting to see if the low of $8.44 1/4 can hold. So far, conditions in Brazil are mostly favorable and there are still concerns that Argentina will make more soybean available to the market. The big wildcard is China's export demand and, so far, they have been holding back with U.S. sales and shipments of soybeans down 17% in 2015-16 from a year ago. January soybeans continue to trade sideways with increased commercial interest at these fundamentally cheap prices. DTN's National Soybean Index closed at $8.27 Friday, below the 200-day average and priced 46 cents below the January contract. There were 910 contracts of December soybean oil delivered early Monday, but no deliveries of meal.

Wheat:

March Chicago wheat was lower early Monday, pressured by news from the CBOT that 2,343 contracts of December Chicago wheat and 198 contracts of December K.C. wheat were given notice for delivery early Monday. With commercials showing over 56,000 contracts net long in the latest Commitment of Traders report, the deliveries should not be a problem, but they do keep prices near their September low of $4.72. This week's precipitation will have benefit for winter wheat crops in the eastern Midwest and Pacific Northwest, but don't offer much for the southwestern Plains. It is a quiet time of year for trading in wheat and December Chicago prices remain under bearish pressure with plenty of U.S. supply available. DTN's National SRW Wheat Index contract closed at $4.24 Friday, below the 200-day average and 55 cents below the March contract.

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

FollowTodd on Twitter @ToddHultman1

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Todd Hultman