DTN Midday Grain Comments

General Comments

The U.S. stock market indices are weaker with the Dow down 110 points. The interest rate products are weaker. The dollar index is 40 points higher. Energies are weaker with crude down 0.50. Livestock trade is sharply higher. Precious metals are mixed with gold up 1.00.

CORN

Corn trade is 2 cents higher at midday and near our daily highs and highs for the move; new highs on the December contract were seen moving just above $4.25. Warm weather should dominate the week, with rain coverage looking better for the west. The second crop areas of Brazil are trending back drier in the near term with some storm damage. Weekly ethanol production was down 350,000 barrels, stocks were up 625,000 barrels with rising gasoline demand, helping to keep futures flat. On the July chart we moved back above the 20-day at $4.01 with the next level of support is 50-day at 3.95 which we tested to start the week, with resistance at the recent high at $4.08.

SOYBEANS

Soybean trade is 4 to 7 cents higher with trade scoring new highs for the move with new crop approaching the $10.50 mark again. Meal is $1.50 to 2.50 higher and oil is 10 to 20 points higher. South America's recent pattern should remain intact near term, with the Real and Peso remaining near record lows and with harvest moving towards the home stretch in Argentina with quality concerns remaining. Crush margins have narrowed but remain positive, with meal starting to find buyers again today. On the July chart, trade is back just above the 20-day at 10.26, with the 50-day at $10.38 the next round up, which we are just below.

WHEAT

Wheat trade is 2 to 8 cents higher with spring wheat leading in two sided trade this morning. Warmer weather should help to boost maturity with the crop still behind normal, but catching up with another week of heat likely to add stress to the heading crop. Some better rain potential was showing for Kansas in the overnight forecast. Spring wheat should see better progress with warmer weather helping to catch up emergence. The Black Sea area will continue to dominate export trade with weather issues limited for the moment but some dryness so far with concerns starting to build, but better rains forecasted. Black Sea values are at $205 a ton. On the July Kansas City contract support is the 20-day at 5.33, with the upper Bollinger Band at 5.65.

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

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