DTN Midday Grain Comments

General Comments

The U.S. stock market indices are mixed with the Dow futures up 70. The interest rate products are firmer. The dollar index is 30 higher. Energies are mixed with crude up 0.10. Livestock trade is mixed. Precious metals are mixed with gold down 10.00.

CORN

Corn trade is 2 to 3 cents higher at midday with trade trying to consolidate the midweek gains into the weekend. Wetter near-term weather may slow harvest progress in many areas this week, while other areas are moving along quickly. Ethanol margins remain tight with production likely to fade near term even after strong runs last week and futures continuing to trend lower, hanging around 1.25. More exports were booked on the daily wire with 121,700 metric tons on the daily wire. Corn basis will likely see more pressure harvest here in the near term. On the December chart, support is at the fresh contract low printed Tuesday at $3.42 3/4 with the 10-day at $3.53, which we are just above this morning with the 20-day at $3.57 the next level of resistance.

SOYBEANS

Soybean trade is 6 to 8 cents lower at midday with trade seeing some liquidation after the strong midweek gains, with the bulk of the gains still in place. Meal is $4 to $5 lower, and oil is 15 to 25 lower. Soybean basis remains historically wide across the belt with storage and shipping concerns continuing to dominate with more business to South America showing up to feed crushers. Crush margins remain strong in the near term with 100,000 metric tons of meal to unknown on the daily wire. Early planting in South America is underway with conditions on the dry side going in but no major concerns expected for a while. The Brazil and Argentina currencies remain historically cheap with the real firming a little midweek. China lowered tariffs on neighboring countries, which could offer some more workarounds on trade. On the November chart, support is the 20-day at $8.38 with the 10-day below that at $8.34. Resistance is the recent high at $8.55.

WHEAT

Wheat trade is 4 to 7 cents lower at midday with spread-unwinding keeping some pressure on wheat after the midweek gains. The U.S. dollar is at the bottom of the recent range but firmer this morning. Russia will continue to work on spring wheat harvest and winter wheat planting with little change in the weather patterns. Australia looks to continue the recent weather pattern with more feed grain imports possible. On the December KC chart, we have support at the 10-day at $5.19, which we moved above Friday with the 20-day at $5.26 the next round higher.

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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