November soybeans closed down 5 1/2 cents Wednesday in spite of row crops in the central Midwest facing four days of extremely high temperatures before more moderate summer weather returns early next week. September KC wheat was down 4 1/2 cents and December corn ended up a quarter cent on a day when most other commodities were trading lower.
September KC wheat sagged quietly lower Wednesday, closing down 4 1/2 cents at $4.41 3/4, while September Chicago wheat was down 2 cents. The next four days of hot and mostly dry weather is tough on harvesters, but not a significant problem for the winter wheat harvest itself. The seven-day forecast is mostly dry for spring wheat in the northwestern U.S. Plains, but temperatures will be on the cool-to-mild side, favorable for wheat crops. September milling wheat in France posted a slight gain Wednesday, but it remains difficult to find any new or serious production threats outside of North America in 2019. News from Dow Jones that Egypt bought 60,000 metric tons of wheat from Russia gave us another reminder of who the world's largest exporter is. With world wheat production on track for a new record high in 2019, wheat's best hope for higher prices this year is a bullish surprise in corn. Until then, the price outlook for wheat remains bearish. Technically, the trend is currently sideways for all three cash wheats. DTN's National HRW index closed at $4.25 Tuesday, 22 cents below the September contract. DTN's National SRW index closed at $4.88, down from its highest prices in four years.
December corn ended up a quarter cent at $4.41 1/2 Wednesday, not showing much response to heat concerns for crops in the latest forecast. As noted the past two days, mostly dry weather and milder summer temperatures are expected in the extended forecast, but from Wednesday through Saturday, extreme heat is going to be felt in the central and southern U.S. Plains, stressful to crops, livestock and the rest of us. By contrast, moderate-to-heavy rains are in the five-day forecast for Minnesota, Wisconsin and much of Iowa. On the demand side, export activity for corn has slowed, but the pace of ethanol production remains supportive for corn prices. The U.S. Energy Department said last week's ethanol production increased from 1.047 to 1.066 million barrels per day, an active pace. Ethanol inventories increased from 23.0 to 23.4 million barrels, one million barrels below their spring peak. The fundamental situation for corn remains baffled by the lack of a credible planting estimate, and it is fair to say that corn yields will be lower in 2019, but it is difficult to guess how much lower. The most likely price outlook is neutral for corn while cash prices are near their highest level in five years, but a more bullish scenario is still possible. Technically, the trend in cash corn is up and choppy with plenty of unknowns still confronting traders. DTN's National Corn Index closed at $4.27 Tuesday, 8 cents below the September contract and a new five-year high. In outside markets, the September U.S. dollar index is trading down 0.24, taking back part of Tuesday's gain, while most other commodities are lower, except for metals, hogs, coffee and oats.