DTN Before The Bell Grains

DTN Before The Bell Grains

CME GLOBEX RECAP:

December corn is up 1 3/4, November soybeans are down 1/4 cent. December KC wheat is down 1/2, Dec Chicago wheat is up 3/4, and December MIAX Minneapolis wheat is up .0150 cents. 

OUTSIDE MARKETS:

The Dow Jones Industrials Index surged 350 points Thursday and Dow futures are down 40 points early Friday. October crude oil is down $0.81 per barrel. The U.S. Dollar Index is down .692 and October gold is up $23.50 an ounce.

CORN:

After December corn fell to the 50-day moving average Thursday some buying was found which enabled the higher close. Early Friday that strength continues. The drier outlook for the Eastern Corn Belt along with the first freeze warnings for the northern belt likely influenced traders. There are some areas that are too dry in the south and the east and after recent showers, the 6- to 15-day portion of the weather forecast calls for drier conditions in the east. On next Friday’s USDA crop production report, it is expected that NASS will likely cut corn yield by 1 to 2 bushels per acre (bpa) from the lofty 188.8 bpa forecast in August. A yield such as that would still result in an all-time monster corn crop. While the east is looking too dry in spots, the Central and Western Corn Belt enjoyed some good rain in the past week. On the demand side, traders look for old-crop corn to reflect some cancellations in Friday’s delayed export sales report. U.S. demand remains stout for new crop but with the recent fall in South American and Ukraine corn premiums, there is plenty of competition ahead. Brazil corn FOB basis is reported to have fallen by 30 cents in the past week, with Argentine premiums dropping by 10 cents. Brazil corn exports in August rose to 6.85 million metric tons (mmt) compared to just 2.4 mmt in July. Argus Media pegged the Ukraine corn crop at 31.3 mmt compared to 26.9 mmt a year ago, and they expect Ukraine corn exports to surge by 6 mmt to 26 mmt. It has been quite a while since we have seen a new U.S. morning flash sale announced. The EIA on Wednesday pegged ethanol production at up just 0.2% to 1.075 million barrels per day with stocks little changed from the previous week. The average Midwest plant is said to be looking at 45 cent per gallon margins. On a positive note, the Census report showed the U.S. exported 245 million bushels (mb) of corn in July compared to 168 mb a year ago. That is the highest total since 2018 with Mexico, Korea and Japan the primary buyers. Traders are keeping an eye on a frost-freeze event in the Canadian Prairies and into the Northern Plains with a freeze warning issued for North Dakota. December corn’s ability to bounce above the widely watched 50-day moving average was a good sign, but a close below $4.14 is likely to lead the next leg down. U.S. corn export sales for the week ended Aug. 28 were a net cancellation of 11.1 mb for 2024-25 and 83.3 mb for 2025-26. Shipments last week were 68.3 mb and below the 91.2 mb needed to reach 2.820 billion bushels (bb). Total corn shipments are now 2.690 bb and are up 27% from a year ago. DTN’s National Corn Index closed at $3.78 and 42 cents below the December contract.

SOYBEANS:

November soybeans were also able to test and bounce from the 50-day moving average Thursday, finishing some 12 cents above that benchmark. Early Friday overnight strength has dissipated some, with November mixed, while soy products are also mixed with soymeal a bit higher and bean oil lower. Supporting soybeans is the mostly dry August and dry finish to soy crops in parts of the eastern belt and south, likely clipping yield from early robust expectations. Commission house and farm advisory firm Stone X dropped their soy yield to 53.2 bpa — down 0.4 bpa from the August USDA number. Perhaps the larger story is not so much the potential for falling production based on the less-than-ideal finish in the east, but more so on the failure to see any China demand. The clock is winding down as China has chosen to buy more expensive Brazilian beans and release some of their own reserves to avoid paying hefty tariffs. Right now any further trade negotiation could be pushed into October or November, likely reducing U.S. demand. The Brazilian ag minister reported that August soy exports reached 9.4 mmt compared to just 8 mmt a year ago, and Brazil’s export group, ANEC, pegs September exports to be 6.75 mmt compared to just 5.1 mmt a year ago. Traders are watching the freeze warnings in the north into the weekend that could compromise yield. Funds have a neutral soybean position while being net-short soymeal to the tune of 70,000 contracts. A break and close below the $10.23 level on November would be bearish. U.S. soy sales for the week ended Aug. 28 were a net decrease of 0.9 mb for 2024-25 and 30.1 mb for 2025-26. Shipments of 16.8 mb were below the 20.4 mb needed to reach 1.875 bb. Total soybean shipments are 1.828 bb and are up 12% from a year ago. DTN’s National Soybean Index closed at $9.56 with a soybean basis of 77 under the November futures. Friday morning, USDA reported private export sales of 123,000 metric tons (mt) of soybeans to unknown destinations for delivery during the 2025-26 marketing year. USDA also reported 204,650 mt of soybeans received for delivery to unknown destinations during the 2025-26 marketing year.

WHEAT:

After not only all three U.S. wheat markets again traded to new lows along with the Paris milling wheat December contract, all were recovering a bit early Friday, but are now mostly mixed. Weakening world wheat cash offers have pressured wheat markets to new lows it seems each week. Russian FOB values, from the high a few weeks ago, have fallen more than $17/mt with plenty of competition from the EU and Ukraine. Also weighing on markets are good rain lately for both Argentine and Australian wheat areas. The U.S. spring wheat harvest as of Sunday last reached 72% done while the Canadian harvest is now 14% complete. Argentine wheat conditions improved in the last week to 79% good to excellent and just 2% poor. That compares to last year at just 44% good to excellent and 17% poor at this time. Wheat tenders include Bangladesh for 50,000 mt, and Jordan returning for 120,000 mt after passing on their last tender. Next week, Syria will seek 200,000 mt of optional soft milling wheat. The Census reported July U.S. wheat exports were 84.7 mb and that is up 22.5% from last year, with Mexico, Nigeria and Japan the prominent buyers. Funds have not wavered on their bearish outlook for wheat with a net-short in Chicago still estimated to be 89,000 contracts. Wheat export sales for the week ended Aug. 28 were 11.5 mb for 2025-26 and just 0.2 mb for 2026-27. Shipments for last week of 32.7 mb were above the 16.7 mb needed to reach 875 mb. Total wheat commitments are now 456 mb and are 22% higher than a year ago. DTN’s National HRW Index closed at $4.29 and 77 under the December futures board.

Dana Mantini can be reached at Dana.Mantini@dtn.com