DTN Midday Grain Comments

General Comments

Corn is 1 cent lower, soybeans are 4 cents lower, and wheat is 5 to 11 cents lower at midday. Outside markets are mostly positive.

CORN

Corn trade is narrowly mixed at midday with trade trying to hold gains amid spillover selling pressure from soybeans and wheat. The second crop in Brazil is being planted in good condition for now with planting heading past the halfway point with early rains looking to be good for germination. The energy complex remains near the upper end of the range, with ethanol futures still struggling to extend into the mid $1.30 range, with the weekly report delayed until tomorrow. Corn basis should firm again with more weather disruptions. On the March chart trade has support at the recent $3.68 1/2 low, the lower Bollinger Band at $3.70 7/8, with more notable chart resistance clustered at $3.76-$3.78. The trading range has been tight but we are near a 3-month low.

SOYBEANS

Soybean trade is 3 to 5 cents lower at midday with selling returning overnight after some early buying with little concrete fresh news. Meal is $1 to $2 lower and oil is flat to 10 points lower. South America weather should maintain the recent pattern in the coming days with Brazil harvest moving along and drier weather in Argentina. Crush margins remain strong with meal holding $300 a ton or better still. Trade talks will continue in the US this week with some progress scored this week according to most sources and the March 1 deadline looming, although there is more talk of an extension. On the March chart resistance is now the moving averages clustered at $9.13-9.15 which we just below, with support at the lows from today at $8.93 with oversold conditions as well.

WHEAT

Wheat trade failed to sustain early buying again with trade 4 to 12 cents lower with spread trade starting to unwind vs. Chicago today. The US has seen better export business lately, but world prices have followed the US selloff with some Black Sea and French tenders securing business to Egypt today, with selling prices $20 a ton lower than last time. The dollar reversed yesterday with trade looking to see if it becomes a multiday thing with Fed guidance today. Cold weather is expected to keep some stress on the plains in the near term with winter wanting to hang around. On the March KC chart support is low at $4.49 3/4 with resistance the 10-day at $4.91.

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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