The U.S. stock market indices are higher with the Dow futures up 50. The interest rate products are higher. The dollar index is 25 higher. Energies are mostly lower with crude up 0.10. Livestock trade is firmer, led by cattle. Precious metals are lower with gold down $5.90.
Corn trade is flat to 1 cent lower at midday in quiet trade, holding above the $3.50 area on the December contract so far. Early harvest should begin to expand with SE Nebraska/NE Kansas/NW Missouri seeing more progress into the weekend, along with parts of Illinois. Ethanol margins remain tight with futures still on the low end of the range but edging slightly higher this morning, while the blender margins remain solid. Corn basis will likely see more pressure harvest here in the near term. Most fundamental arguments are that corn has good value at or below our contract low, with the daily export wire quiet today. On the December chart support is at the low at $3.48 3/4 with the 10-day at $3.62 as resistance.
Soybean trade is flat to 1 cent higher at midday with trade trying to build better footing after failing to hold the midweek gains yesterday. Meal is $4 to $5 lower and bean oil is narrowly mixed. Soybean basis is expected to see more pressure as storage space will be at a premium once harvest gets rolling. Crush margins remain strong with the recent meal rally, along with outstanding biodiesel margins. Early planting in South America will be getting underway soon with conditions on the dry side going in but no major concerns expected for a while and the Brazil and Argentina currencies remain historically cheap with the real falling back to the lows. US and Brazil offers are near parity to China even with the tariffs. The second round of trade aid is being targeted for early December. On the November chart support is fresh lows at $8.21 scored Wednesday, with the 10-day at $8.39 and the 20-day at $8.53 noted resistance levels.
Wheat trade is 5 to 8 cents higher at midday with short covering heading towards the weekend after the midweek washout. The U.S. still struggling to secure export business. The U.S. dollar is chopping along at the lower end of the range with fall offers likely to get more export interest than nearby ones. Russia is expected to catch some rain in the near term while they try to cut spring wheat and plant winter wheat with some snow in Siberia. Australia looks to have more mixed weather in the near term with longer-term dryness still an issue as we get closer to harvest there. Matif Milling wheat is firmer this morning as well. On the December Kansas City chart we have support at the lower Bollinger Band at $4.92 with resistance the 10-day at $5.22.
David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered adviser.
He can be reached at firstname.lastname@example.org
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