DTN Midday Grain Comments

General Comments

The U.S. stock market is lower at midday with the Dow down 65 points. Interest rate products are lower. The dollar index is 50 points lower. Energies are firmer with crude .70 higher. Livestock trade is mixed. Precious metals are mixed with gold up $4.10.

CORN

Corn trade is flat to 2 cents lower with trade chopping around as we head towards the December option expiration Friday. Ethanol margins should remain stable in the near term with the strength in the energy complex. Carry and basis is stable to a little weaker Friday. Trade will run from 8:30 a.m. CST to 12:05 p.m. CST today. Export sales were strong at 1.09 million metric tons. On the December chart support is the 10-day at $3.42, with the low at $3.36 1/4 below that. Resistance is at the $3.48 3/4 50-day moving then the $3.58 6-week high.

SOYBEANS

Soybean trade is flat to 2 cents higher with trade looking to pin the 10.00 area with significant December option interest there. Meal is $1.50 to 2.50 higher and oil is 10 to 20 points lower. South American weather looks like more of the same in the near term, with the Argentina forecast showing quite a bit of daily flux, dryness starting to build more in northern Argentina. Export business has been quiet for the bulk of November on the daily wire, but more action has shown up this week. The weekly export sales were mixed, 869,100 metric tons of beans, 379,800 of meal, and 4,200 of oil. Basis has continued to firm at processors. On the January chart futures moved back above all the major moving averages, with the 20-day at $9.86 the first level of support which we are just above, and the recent high at $10.08 the next level of resistance.

WHEAT

Wheat trade is 3 to 6 cents lower on the three contracts this morning with trade chopping back to the lower end of the range with buying interest from the start of the day session. KC is gaining vs. Chicago. The Plains look pretty warm and dry the next 7-12 days, which will attract more attention heading to dormancy. Spillover support from row crops will be needed to help with short-covering with trade struggling to hold intraday gains this week. Basis has firmed a bit on the Plains in recent days, but overall remains wide. Weekly export sales were soft at 199,500 metric tons. On the December KC support is the $4.13 1/2 low, with the 10-day and 20-day at $4.23, as resistance which we are tested but failed to hold.

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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