DTN Midday Grain Comments

General Comments

The U.S. stock market indices are firmer with the Dow up 90. The interest rate products are weaker. The dollar index is 5 points higher. Energies are mixed with crude up 0.70. Livestock trade is mixed. Precious metals are mixed with gold down $3.80.

CORN

Corn trade is 3 to 4 cents lower at midday with trade seeing spillover pressure from the soybeans rolling lower after initial strength following the report and overnight. Cooler weather begins working through the belt today with wetter weather also expected. Ethanol board margins remain stable with corn and ethanol futures lower this morning. Corn basis has been flat to firmer in recent days with the lower board. The WASDE report kept yields unchanged at 174.0 BPA with production up slightly to 14.320 billion bushels, with old crop carryout at 2.027 billion bushels, and new at 1.552, vs. expectations of 2.106 and 1.733 billion bushels. The world stocks were 191.7 million metric tons of old crop vs. 191.3 expected, and new crop at 152.0 vs. 154.7 million metric tons expected. On the September chart we remain below the 10-day at $3.50, with the 20-day at $3.57 the next round up. Support is the fresh low of $3.37 scored yesterday with the lower Bollinger Band at $3.39 above that.

SOYBEANS

Soybean trade is 11 to 14 cents lower at midday with trade going to new lows this morning before firming a bit, with the big carryout increasing hanging over the market. Meal is $3 to $4 lower and oil is 30 to 40 points lower. Brazil remains at a stout premium to US origin, which is compounded by the ongoing logistics issues with Brazil with premiums around $1.90 right now. Bean basis has remained steady with processors taking the lead. The daily export wire has remained quiet. Weather should continue to push growth along in the near term. On the WASDE report, yield was unchanged at 48.5 BPA with production of 4.310 billion bushels, with old crop carryout at 465 million vs. 507 million expected, with 580 million of new vs. 385 expected. World stocks were 96.0 million old crop vs. 92.5 million expected, and new crop at 98.3 million metric tons vs. 87.0 expected. On the August chart the 10-day at $8.48 is again the first level of resistance with further support the lower Bollinger Band at 8.18 with the next level resistance the 20-day at 8.69.

WHEAT

Wheat trade is 4 to 10 cents higher at midday with trade trying to separate from the row crop trade and continue to firm again. Harvest progress should continue to push along with the homestretch ongoing for the Plains. Spring wheat should see good progress in Canada with better rains starting to show up over the Prairie provinces. Russian harvest continues to move along as well. HRW basis has remains solid through harvest with the better protein with offered premiums declining. The WASDE report had production at 1.881 billion bushels, up from 1.827 last month with old crop carryout at 1.1 billion vs. 1.098 expected, and new at 985 million vs. 946 expected. World stocks were 273.5 million metric tons vs. 272.3 expected on old crop, with 260.9 on new vs. 264.1 expected. On the September Kansas City is back below the major moving averages with the 10-day at 4.90 as resistance which we have tested this morning and support the lower Bollinger Band at $4.57.

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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