By MATT PIKE
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GENERAL COMMENTS:
December corn closed up 3/4 cent per bushel at $4.04 and March corn was up 1 1/2 cents at $4.22. November soybeans closed up 2 1/4 cents at $10.36 0/1 and January soybeans were up 2 cents at $10.55 1/4. December KC wheat closed up 1 1/2 cents at $5.23 1/4, December Chicago wheat was up 7 cents at $5.28 1/4 and MIAX December Minneapolis wheat was up 0.02 cents at $5.8975.
The September U.S. Dollar Index is trading down 0.064 at 98.055. The Dow Jones Industrial Average is down 88.22 points at 44,834.05. December gold is up $29.30 at $3,388.00, September silver is up $0.44 at $37.77 and September copper is up $0.0050 at $4.4275. October crude oil is up $0.95 at $62.72, October heating oil is up $0.0297, October RBOB is up $0.0367 and September natural gas is down $0.016.
CORN:
Corn futures were quietly higher Wednesday in slow trade, rejecting early weakness to finish higher. Reports from the ongoing Midwest annual crop tour showed more good numbers with record pod counts in Nebraska soy and higher corn yields and record ear counts in Indiana. However, there were some weather issues and tour participants found tip back on western and northern Illinois fields Wednesday, so perhaps some strength came from that. However, it is likely both Illinois and especially Iowa will show record potential when done. Some rust is being found in Kansas, Nebraska and Iowa fields, which could have a small impact on yield. Corn demand continues to be very good with two more sales to Colombia and Mexico announced on Wednesday amounting to 9 million bushels (mb). Corn sales and inspections continue to run at a solid pace, However, with Brazil's safrinha corn harvest nearing the finish line, they have become much more aggressive in selling corn, with shipping firm ANEC reporting Brazil would ship over 8 million metric tons (mmt) in August, 1.5 mmt higher than a year ago. IN EIA's weekly petroleum report ethanol production slipped 2% lower at 1.072 million barrels per day while stocks remained steady. Word from the University of Illinois is that the breakeven cost on corn, depending on the area, ranges from $4.64 to $4.94 with futures sitting at $4.06 currently. Funds remain net-short corn to the tune of 160,000 contracts. DTN's National Corn Index is $3.61 and 19 cents under the September futures.
SOYBEANS:
Soybeans were modestly higher Wednesday, drawing strength from the continuing rally in soybean meal. It is being reported that not only are funds covering some of their sizeable meal short, but traders are also unwinding September-October spreads, which has moved that from a $4.00 carry to a $2.00 inverse. Bean oil continues to show weakness with September threatening to fill an open chart gap left following the June announcement of the increased RVOs for biodiesel. Tour participants are finding record pod counts in many areas such as Nebraska and are hinting at the potential for record soy yields. Unlike corn, demand is not keeping pace with the expectation for increased supply. The ongoing tariff battle with China has sent them on a buying spree from Brazil all the way into November, and at close to a $1.00 premium to U.S. FOB beans. While China would typically take anywhere from 2 mmt to 8 mmt of U.S. new-crop beans by mid-August, with the 23% tariff they imposed on U.S. beans they have bought zero so far. China's July soy imports from Brazil jumped 14% from the previous year to 10.4 mmt. The American Soybean Association is urging the Trump administration to get a grain deal with China soon or many farmers would face financial hardship. The weather forecast is mostly dry this week until the weekend when we will see rain in the western Midwest. The soy crop will need some finishing rain to solidify record yields. DTN's National Soybean Index is $9.67 and 67 under the November futures.
WHEAT:
Wheat markets began Wednesday by falling to new contract lows, but each market recovered to finish higher, with Chicago leading the way. Both the KC and Chicago markets had become extremely oversold and due for a bounce. It is being reported that FOB soft red wheat had become so cheap at the Gulf and more than $10 below FOB Russian wheat that it has drawn some Asian interest. Growing supplies and aggressive marketing from other major wheat exporters, especially Russia and the EU, have pressured wheat lately. In other news, the U.S. spring wheat harvest is advancing and as of Sunday was over 36% done. Tenders include Bangladesh for 50,000 mt of optional milling wheat and Taiwan is tendering for over 90,000 mt of U.S. milling wheat. Jordan passed on its tender for 120,000 mt of milling wheat. Funds remain short both KC and Chicago wheat. DTN's National HRW Index is $4.50 and 50 cents under the September futures.