DTN Midday Grain Comments

General Comments

The U.S. stock market indices are higher with the Dow up 30. The interest rate products are mostly lower. The dollar index is 10 lower. Energies are mostly lower with crude down 0.10. Livestock trade is mixed. Precious metals are mixed with gold narrowly mixed.

CORN

Corn trade is 4 to 5 cents lower at midday with early gains evaporating into fresh one-week low with harvest pressure picking up. Ethanol margins are stable but some seasonal shut downs could slightly lower usage near term. The weekly report Monday afternoon showed conditions unchanged at 61% good to excellent and 13% poor to very poor which the market viewed as favorable for market bears. Progress numbers were at 86% dented, 4 percentage points behind average, 34% mature, 13% behind average, and 7% harvested, 4 percentage points behind average. The weather should allow good maturation in the week ahead. On the December chart support is at the $3.44 1/4 low with resistance at $3.54 1/4, where we find the 10-day and 20-day moving averages; which are also the lowest major moving averages. The technical trend remains down with trade below all major moving averages and we are not in oversold conditions at this juncture.

SOYBEANS

Soybean trade is 7 cents lower at midday with trade seeing harvest pressure, along with the string of sales on the daily wire being broken. Meal is $4 to $5 lower and oil is 10 points higher. South America looks to remain mostly dry near term with major planting progress just around the corner so the extended forecasts are drawing more attention. The weekly crop conditions had 59% rated good to excellent, down 1% on the week. This should help give light support tonight. Progress numbers listed 41% dropping leaves, 2% behind average, and 4% harvested, 1% behind average. The daily export wire is expected to remain active going forward even as we had nothing to announce today. On the November chart support was at the 10-day moving average at $9.65 which is now resistance, with the 200-day at $9.79 3/4 major resistance. The 20-day at $9.54 is new support.

WHEAT

Wheat trade is 5 to 8 cents lower at midday with the weaker row crop trade overcoming the early supportive trade. We remain within the recent range on winter wheat, and at the lower end on spring wheat. Australia continues to see some struggles as the crop emerges from dormancy, while the large Russian crop will continue to keep pressure on the ability of the US to compete on the world market, even as the dollar values remain soft. Egypt is starting to look around for cargos again. Winter wheat planting was 2% behind average at 13%, and spring wheat harvest is complete. On the December KC contract we slipped below the 20-day at $4.37 with longer term support the $4.20 contract lows with resistance at the recent high at $4.51 3/4, with the 50-day at 4.74 above that.

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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