DTN Midday Grain Comments

General Comments

The U.S. stock market is lower at midday with the Dow down 50 points. The interest rate products are mostly higher. The dollar index is 45 lower. Energies are lower with crude was 1.50 lower. Livestock trade is lower. Precious metals are mixed with gold up $1.00.

CORN

Corn trade is 4 cents lower at midday with new lows being scored about every 15 minutes or so by a quarter cent, with some noting this slow but lower trade as death by a 1,000 cuts to market bulls. Soybean trade is also very slow but slowly slipping to new lows for the move which yesterday and today the spillover soybean pressure appears to be behind lower corn trade. Also South American weather is viewed as non-threatening. Ethanol margins not gaining today with ethanol futures down 2 cents at midday. The USDA announced 133,096 metric tons of corn sold to unknown. The weekly progress report showed harvest at 83% complete, 9% behind average but at this juncture the market does not appear to view this as anything but some producers taking their time on the last part of harvest. On the December chart support is at the new low at $3.37 3/4 with resistance at the $3.50 50-day moving then the $3.58 6-week high.

SOYBEANS

Soybean trade is 5 cents lower at midday with chart pressure and a lack of fresh friendly fundamentals. Meal is $1 lower and bean oil is 25 points lower. Outside markets have crude and the stock market lower giving pressure but the weaker dollar is limiting downside. South American weather looks good as a whole. The weekly crop progress showed the 2017 soybean U.S. harvest at 93%, 2 percentage points behind average. The USDA WASDE last Thursday was negative for beans and corn; with limited friendly news this week chart pressure is what thee trade is talking about. On the January chart futures fell below all the major moving averages yesterday with the 100-day at $9.76 now resistance with the September low of $9.60 the next notable support with many chart analysts mentioning the $9.50 level.

WHEAT

Wheat trade is 1 lower to 2 cents higher at midday with trade trying to regain some momentum after the poor start to the week. Minneapolis wheat trade has cooled off as basis movement has slowed. The winter wheat weekly crop conditions had good to excellent ratings down 1 percentage point at 54% with 95% planted, same as the average pace. Dryness is a concern which is limiting downside on the winter wheat contracts. Emergence was at 84%, 1 percentage point ahead of average. The Russian ruble weakness this week helps Russian competitiveness on the world market. No one is mentioning this as a case of Russian meddling at this juncture. On the December Kansas City support is at the $4.27 20-day, which is we are just below overnight then the $4.13 1/2 low. Resistance is at the $4.36 50-day then the $4.60 three-month high.

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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