DTN reports:

December KC wheat closed up 16 cents Tuesday, posting a new three-month high after cold morning temperatures invaded the southwestern U.S. Plains and prompted short-covering among bearish noncommercials. December corn was up 4 1/2 cents and January soybeans ended unchanged ahead of Tuesday afternoon’s harvest update.



December KC wheat closed up 16 cents at $4.38 3/4 Tuesday, the first close above the 100-day average since early July and a new three-month high. Sub-freezing temperatures reached all the way to central Texas early Tuesday with single-digit readings in Kansas. We can’t say this will ruin winter wheat crops as they are proven to be hardy, but it may have been enough of a threat to spark short-covering among the speculative crowd. The other factor favoring Tuesday’s higher wheat prices is that the bearishness of the market is well known and we are now entering a time of year when commercials will have to bid up to entice supplies to come their way. Tuesday’s report of weekly export inspections was also supportive for wheat prices. USDA said 19.4 mb of wheat were inspected last week, putting total inspections up 23% in 2019-20 from a year ago, just a few weeks from the season’s halfway mark. Fundamentally speaking, world wheat supplies remain a bearish weight on wheat prices, but the bearish view is well advertised and prices are entering a time of year when they tend to drift higher. Technically, the near-term trend remains up for Chicago wheat and sideways for KC and Minneapolis wheat. DTN’s National HRW Index closed at $3.97 Monday, down from its three-month high and 26 cents below the December contract. DTN’s National SRW Index closed at $4.95, down from its four-month high.



December corn closed up 4 1/2 cents at $3.77 3/4 Tuesday, a day of quietly higher trading ahead of Tuesday afternoon’s update from USDA on harvest progress. Except for snows of various depths across the Midwest, the weather has been mostly dry and cold, which works for corn harvest progress. The catch is that propane supplies have been difficult to secure across the northern Midwest and that may encourage some to leave corn in the field to dry. The seven-day forecast remains mostly dry across the central U.S. with temperatures turning warmer after Tuesday. Increased chances for rain in the extended forecast may change minds about leaving crops out. Earlier Tuesday, USDA said 22.1 million bushels (mb) of corn were inspected for export last week, twice the previous week’s amount. However, with total corn inspections down 61% in 2019-20 from a year ago, inspections remain well below USDA’s export estimated pace. Fundamentally speaking, USDA’s ending stocks estimate of 1.91 billion bushels (bb) should keep a lid on corn prices, unless the January WASDE report is holding a significant surprise in the crop estimate — still a possibility in this unusual year. Technically, the trend for cash corn is down, but keep in mind we are entering a less-volatile time of year for trading. DTN’s National Corn Index closed at $3.59 Monday, down from its two-month high and 14 cents below the December contract. In outside markets, the December U.S. dollar index is up 0.17 and outside commodities are mixed.

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