DTN Midday Grain Comments

General Comments

The U.S. stock market indices are mixed with the Dow 80 higher. The dollar index is 15 lower. Interest rate products are mixed. Energies are weaker with crude $0.10 lower. Livestock trade is mostly lower. Precious metals are weaker with gold 13.70 higher.

CORN

Corn trade is flat with trade around 3 lower to 3 higher overnight up through midday. Most traders are noting the weather forecast has, or has had, a little for the bulls and bears since Friday. Cooler, wet weather looks to remain into the middle of June for most of the belt with rain moving across the western belt this morning. Bigger rains are expected mid belt to east the rest of the week, mostly in the southern half of the main Corn Belt. The ethanol margins are struggling with the pullback in the energy complex with ethanol futures hanging around $1.52, well off the recent lows. Basis has seen selling pressure from farmer movement and the higher board. The weekly export inspections softened with the holiday week at 743,077 metric tons. The weekly Crop Progress is expected to show planting in the 66%-73% range with emergence just short of 50%, which remains record slow. On the July nearby chart, support is the $4.10 10-day moving average with the recent high at $4.38, and then the upper Bollinger Band at $4.40.

SOYBEANS

Soybean trade is 1 to 2 cents higher with choppy midday trade as the markets are still working to defend acres. Meal is $2 higher and oil is 30 points lower. Crush margins remain solidly positive overall with meal pushing back above $320 last week. South American currencies remain cheap at the end of harvest but are back off the recent lows, with the export wire quiet for the U.S. Fieldwork should generally remain slow Monday, but more progress is likely early in the week. The higher price of corn is pulling soybean prices higher along with fears of high prevented planting acreage. The price is pushing for acres to shift to corn or milo when possible, but late plantings may still force beans as the better alternative. The weekly export inspections remained soft at 498,771 metric tons. Weekly planting progress is expected to remain record slow with most focusing on corn first. The July chart support is the 50-day at $8.71, and resistance the 100-day at $9.01 1/2.

WHEAT

Wheat trade is 10 to 13 cents higher at midday with trade finding support from wet weather on the Plains hurting crop quality and warmer weather in the Black Sea testing the growing crop there. KC continues to narrow the discount to Chicago, down to 26 cents from 51 cents a couple weeks ago. The dollar has dropped with the trade concerns as well. Hard red wheat is working into feed rations in some areas with the bounce in corn values, and reduced quality may increase feeding on that front. The weekly Crop Progress report is expected to show reduced good-to-excellent ratings and slow maturity, with spring wheat catching up closer to normal. Export sales inspections were off a little at 592,744 metric tons. On the July KC chart, support is the 10-day at 4.52, and the 100-day at 4.58, with the next round up the $4.95, the daily high, and then the 200-day at $5.02.

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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