DTN Midday Grain Comments

General Comments

The U.S. stock market indices are higher with the Dow up 100 points. The interest rate products are lower. The dollar index is 14 points higher. Energies are weaker with crude down 0.80. Livestock trade is mixed with cattle lower and hogs firmer. Precious metals are mixed with gold down $.80.

CORN

Corn trade is 3 to 4 cents lower at midday with early support giving way to new lows for the move. Spillover pressure from wheat is a midday issue. The crop tour wrapped up with a 170.2 BPA projected yield, versus the 175.1 USDA number, giving us 14.7 billion bushel production. This only provided light support last night, with a mostly red morning so far. Ethanol margins have improved with ethanol futures stable to firmer with the cheaper corn. Corn basis will remain on the defensive as harvest approaches. The weekly conditions and progress report is expected to show steady conditions and maturity remaining ahead of normal. The weekly export inspections were good at 1.422 million metric tons. On the chart, resistance is in the area in between the 10-day and 20-day moving averages at $3.34 - 3.36, then the $3.44 1/4 August high. The fresh contract low of $3.20 3/4 is December support.

SOYBEANS

Soybean futures are flat to 3 cents lower oat midday; it has been a mixed session. Meal is $1 to $2 higher and oil is 35 to 45 points lower. Supoprt has come from another daily sales annoumcement with 393,000 metric tons of soybeans sold for new crop. The crop tour pegged soybean yields at 49.3 BPA and production at 4.093 billion bushels versus the USDA 48.9 BPA and 4.06 billion bushel production number. Good to excellent ratings should remain steady if not go up a percentage point next week with neutral weather going into midweek. Maturity should remain ahead of normal pace. The weekly export inspections remain strong at 921,137 metric tons, with the inspection pace now ahead of last year. On the November soybean chart support is at the $9.60 low from Friday with the 200-day at $9.64 above that; we are holding that area this morning. Chart resistance is at the 20-day at $9.87.

WHEAT

Wheat trade has seen continued selling after the collapse on Friday, with trade 5-15 cents lower at midday led by Chicago again. Spring wheat will continue to see harvest pressure with ample supply weighing on all classes. Canadian harvest will be hitting full stride soon, and Russia looks to continue an aggressive export pace with ongoing issues in Egypt causing issues. The weekly export inspections were down a bit to 511,965, with action solidly ahead of last years pace. On the Kansas City December chart support is now the $4.00 area, with trade well below the nearby moving averages. Chicago has printed a new contract low for the fourth day in a row, which Kansas City starting to reestablish its typical premium over the contract.

David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered trading adviser.
David Fiala can be reached at dfiala@futuresone.com
Follow David Fiala on Twitter @davidfiala

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