DTN Midday Grain Comments

General Comments

The U.S. stock market indices are firmer with the Dow up 140. The interest rate products are lower. The dollar index is 35 points lower. Energies are firmer with crude up 0.40. Livestock trade is mixed with hogs higher and cattle lower. Precious metals are firmer with gold up $3.40.

CORN

Corn trade is 1 to 2 cents lower at midday after trading over a penny higher overnight illustrating pre-report type action. The heat placement in the extended forecast is getting attention but with moisture and mild temperatures this week we are keeping the market near the summer lows. Looking to Friday, the average trade guess for the June USDA Planting Intentions is 89.82 million acres versus 89.996 in March and 94.004 a 2016. The range of estimates is 89-90.6 million acres. The June 1 Quarterly Grain stocks report is expected to have corn at 5.16 billion bushels versus 4.711 billion a year ago. The weekly ethanol report showed production 2.53% higher and stocks 1.98% lower with gasoline demand down 2.83%, leaving ethanol futures unchanged at midday. July corn futures have support at the new low printed Friday at $3.56 with resistance at the $3.67 10-day moving average.

SOYBEANS

Soybean trade is 3 cents higher at midday, which has us in the upper half of a 7 cent trading range. Meal is $1 higher and oil is 5 points lower. The weak dollar, moving to new lows for the move, has been supporting commodities. The heat in the extended forecast is also limiting downside this week after the pressure last week. Looking to Friday, the USDA June Planting Intentions expectations are limiting upside with the average trade guess at 89.95 million acres versus 89.5 million on the March report and up from 83.4 million a year ago. This would be the first year soybean acreage surpasses corn and frankly the first year they have been close to each other. The June 1 stocks are expected to be at 981 million bushels versus 872 a year ago. July beans have major support at the $9.00 14-month low made last week, with the 10-day at $9.20 first resistance.

WHEAT

Wheat trade is 2 to 3 cents higher on Chicago and Kansas City; Minneapolis wheat is leading again with trade up over 15 cents and above $7 at midday. Minneapolis has been up 30 cents. The poor spring wheat crop and short covering appears to promise us an active Minneapolis market the rest of the week. The average trade guess for the all wheat planted number on Friday is at 46.045 million acres versus 46.059 on the March report. The June 1 Quarterly Wheat stocks are expected to be at 1.154 billion versus 976 billion a year ago. The spring wheat acreage estimate is at 11.234 versus 11.308 on the March report. Winter wheat harvest should continue to progress this week with isolated storm delays and mixed yields, with the weaker dollar helping competitiveness on the export market coming forward. Europe conditions will continue to be watching with estimates in retreat. On the July Kansas City contract support is the 100-day at $4.52 with resistance the 10-day at $4.65.

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

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