DTN Midday Grain Comments

All Grains Higher at Midday

David M Fiala
By  David Fiala , DTN Contributing Analyst
(DTN photo by Nick Scalise)

General Comments

The U.S. stock market indices are higher with the Dow 110 points higher. The interest rate products are weaker. The dollar index is 5 higher. Energies are firmer with crude up 0.35. Livestock trade is higher with hogs leading. Precious metals are mixed with gold down 0.50.


Corn trade is 5 to 7 cents higher at midday with the ongoing wetter forecast and planting concerns driving the market with trade pulling back a little from the early highs. Drier weather will linger the next few days for many allowing some progress, with bigger rains expected into next week. The weekly ethanol report showed production up 15,000 barrels per day, with stocks down 218,000 barrels, and ethanol futures closing in on $1.35. Basis will see pressure from increased farmer selling on the rally. On the July nearby chart, support is 50-day at $3.71 which we moved through overnight, with the next level of resistance in the upper Bollinger Band at $3.75 5/8 which we are testing at midday, and then the 100-day at $3.81.


Soybean trade is 6 to 8 cents higher at midday with trade following the lead of corn, with the prior July gap at $8.40 being filled overnight. Meal is $2.00 to $3.00 higher and oil is 30 to 40 points higher. Crush margins remain solidly positive. South American currencies remain cheap at the end of harvest, but rising basis is helping U.S. offers with the export wire more active in recent days. Field work should generally remain slow in the near term but more progress is likely into next week with little incentive for farmers to push right now. Trade talks are expected to continue, but more U.S. gov't payments to farmers look to be the more likely outcome at this point. The July chart support is the 10-day moving average at $8.27, which we moved above overnight with the 20-day at $8.49.


Wheat trade is 4 to 10 cents higher at midday with winter wheat leading and support from the row crops again this morning. Europe and the Black Sea area will be watched with dryness in the Volga Valley, and wet weather in the U.S. potentially limiting planting and causing disease issues in the winter wheat. The dollar remains rangebound. Hard red wheat is working into feed rations in some areas with the bounce in corn values. On the July Kansas City chart support the 20-day at $4.06 that we moved above overnight, with the 10-day at $4.02 below that, and the 50-day at $4.28 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


David Fiala