DTN Midday Grain Comments

General Comments

The U.S. stock market indices are firmer with the Dow 300 points higher. The interest rate products are firmer. The dollar index is 25 points lower. Energies are firmer with crude up $0.80. Livestock trade is mixed with hogs leading. Precious metals are mixed with gold up $1.20.

CORN

Corn trade is 2 to 3 cents higher at midday with light buying returning after trade fell into support levels and oversold conditions to open the week. The second crop in Brazil is being planted in good condition for now with planting heading towards the halfway point. Ethanol margins remain poor with futures finding some strength to start the week, getting back over $1.33, and we are getting closer to the spring unleaded blends that will boost blender margins. The USDA announced 122,036 metric tons sold to unknown. Corn basis should firm again with more weather disruptions. On the March chart support is the $3.72 lower Bollinger Band and the fresh low at $3.71 3/4. Resistance is at the $3.77-$3.78 cluster of major moving averages again.

SOYBEANS

Soybean trade is 4 to 6 cents higher at midday with overall rangebound action continuing amid trade talks and South American harvest. Meal is $1.50 to $2.50 higher and oil is narrowly mixed. South America weather looks to continue to drift towards improvement in Brazil and Argentina with harvest continuing to move in Brazil and pod fill starting in Argentina. Crush margins remain strong overall, with basis likely to turn steadier on weather and the futures pull back. More private sources in Brazil continue to migrate production towards the 112 million metric tons area with CONAB at 115 million metric tons, but a downward bias. Trade talks are underway in China. On the March chart resistance is now the 50-day at $9.13, and support the 100-day at 9.00.

WHEAT

Wheat trade is flat to 4 cents lower in quiet midday trade with the intramonth spreads still firming and KC being the weak side of the trade. The US has seen better export business lately, and more sales confirmation will boost the spread action with Egypt and Nigeria buying in recent days, along with potential Indonesian interest. The dollar rally has paused today at the top end of the range. Southern Hemisphere harvest will continue in the near term. On the March Kansas City chart support is low at $4.87 1/2 with resistance the 10,20, and 50-day moving averages clustered at $5.02-5.04.

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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