DTN Closing Grain Comments
The bearish start to September continued early Thursday before buyers stepped up by late morning, eventually turning soybean and corn futures slightly higher by the close. Meanwhile, wheat futures remain under heavy pressure but are quickly approaching long-term chart support. For now, with a lack of significant market-moving news traders are opting to trade seasonality, of which 5- and 10-year indices suggest a weak start to September while also suggesting the market may start feeling for a pre-harvest bottom over August and September as well. Outside markets were mixed on Thursday with energies mostly lower, but stock indices recovered from a sluggish restart to trade post Labor Day.
(DTN illustration by Nick Scalise)
DTN Closing Grain Comments
GENERAL COMMENTS:
December corn closed up 1 3/4 cents and March corn was up 1 1/2 cents. November soybeans closed up 1 1/2 cents and January soybeans were up 1 1/2 cents. December KC wheat closed down 4 cents, December Chicago wheat was down 2 1/2 cents, December MIAX Minneapolis wheat was down 2 3/4 cents.
The U.S. Dollar Index is up 0.20 at 98.34. The Dow Jones Industrial Average is up 331.0 points at 45,639.0. December gold is down $34.00 at $3,601.50, December silver is down $0.82 at $41.25 and December copper is down $0.0650. October crude oil is down $0.52 at $63.45, October ultra-low sulfur diesel is down $0.0327, October RBOB gasoline is down $0.0035 and October natural gas is up $0.010.
CORN:
December corn futures rose 1 3/4 cents on Thursday to $4.19 3/4. March corn was 1 1/2 cents higher, closing at $ 4.37 1/2. It was a technically optimistic session after December futures again held support on a test of the 50-day moving average of $4.14 1/4, encouraging buyers to send prices over a nickel off the daily low by the close. To me, key resistance is now in the upper $4.20s near $4.27. Eventually the corn market will need to make headway to the upside otherwise pressure against the 50-day moving average is bound to prevail if tested one to two more times.
The Energy Information Administration released ethanol production data for the final full week of the 2024-25 corn marketing year on Thursday morning, pegging last week’s average at 1.075 million barrels per day, up 5,000 barrels from the prior week. All totaled, weekly production averages point to ethanol production through 2024-25 at roughly 3% higher than the previous year, despite lower corn usage overall, suggesting higher use of other feedstock such as sorghum and perhaps higher plant yields as well.
The past 24 hours showed much needed rain showers in the Eastern Corn Belt, specifically across the Illinois, Ohio, and Kentucky three-state area, although it would appear many needy areas were again missed. The next 2-week forecast shows spotty coverage across those areas from Missouri eastward, which may prove challenging to finishing out the corn crop.
The DTN National Corn Index finished Wednesday at $3.77. Thursday’s futures close and implied corn basis of 41 cents under the December board would indicate the index on Thursday afternoon to be near $3.79.
SOYBEANS:
November soybeans closed up 1 1/2 cents on Thursday to $10.33. January futures were also up 1 1/2 cents to $10.51 1/2. November futures narrowly avoided trading lower for the third straight session, rallying over a dime off daily lows by the close. Early Thursday, the November contract had traded to a 50% retracement of the August rally from the mid $9.80s, with buyers stepping up orders near this area, which helped stage the rally back above the 50-day moving average near $10.23 1/2, with prices eventually reclaiming the 100-day moving average near $10.30 in an all-around optimistic technical session for the soybean market.
The same weather concerns touched on for corn certainly apply to the soybean crop in those areas and perhaps have higher stakes for the soybean crop given the geography of the emerging dryness through August as well as the significance of August in general for soybean development. However, as mentioned in previous daily comments, the trade for now is more focused on the lack of export demand from China, with Friday’s delayed export sales report from USDA offering the next update on that front.
Adding pressure to the soybean market recently has been the falloff in soybean oil prices, dropping on Thursday to the lowest price since the bullish June 13 EPA biofuel mandate proposal, and officially filling the chart gap left by that news. It was optimistic to see prices rally off this level and also managing to finish with daily gains, perhaps a sign of significant support here for prices.
The DTN National Soybean Index finished Wednesday at $9.54. Thursday’s futures close and implied soybean basis of 77 cents under the November board would indicate the index on Thursday afternoon to be near $9.56.
WHEAT:
December Kansas City futures fell another 4 cents on Thursday to $5.06 1/4, setting yet another contract low in the process. The market traded to within 1 3/4 cents of the $5.00 mark, again finding support. Front-month futures have now challenged that level three times through 2025 — in May, early August, and again on Thursday — with buying interest prevailing on each attempt thus far. Chicago and Minneapolis wheat varieties were also lower for Thursday.
Continued dry weather across the Northern Plains is keeping harvest rolling for the 2025 U.S. spring wheat crop. Meanwhile, in Canada, spring wheat harvest in Saskatchewan was noted at 14% complete at the beginning of September according to the Ministry of Agriculture’s weekly Thursday update. Yields are expected to be slightly lower than a year ago, although total production is expected to still be ahead of the 5-year average. On the U.S. front, strong export demand has been the shining star of the wheat market, with inspections as of Tuesday’s USDA update running 15% ahead of a year ago. Friday’s delayed export sales report will offer further clues into demand for U.S. wheat amid falling world values.
The DTN National HRW Index finished Wednesday at $4.33, while the DTN National HRS Index was at $5.19. Thursday’s futures closes and implied basis of 78 cents under the December board for HRW, and 54 cents under the December board for HRS, would indicate the indices for Thursday afternoon to be near $4.29 and $5.16, respectively.
Rhett Montgomery can be reached at Rhett.Montgomery@dtn.com
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