DTN Midday Grain Comments

General Comments

The U.S. stock market indices are lower with the DOW futures down 65 points. The interest rate products are higher. The dollar index is 25 lower. Energies are mixed with crude down 0.80. Livestock trade is mostly higher. Precious metals are higher with gold up $5.80.

CORN

Corn trade is 6 to 8 cents lower at midday with profit taking as rains fall across parts of Iowa as we head towards the weekend. Heat and mixed rain coverage remain in the near-term forecast with the more extended forecast hinting at improvement. Corn is in the middle of pollination this week, so some heat stress is the concern with trade looking towards the conditions on Monday to assess the effects of this week. Ethanol production margins are mixed overnight with the crude rally fading along with the cheaper corn. Midday forecasts should provide direction into the weekend, with more action late depending on forecasts. On the December chart support is the $3.97 10-day moving average, with the 20-day at $3.93 below that, resistance will be the weekly high at $4.06.

SOYBEANS

Soybean trade is 6 to 10 cents lower midday with trade backing away from the weekly highs on the rains in the central belt overnight. Meal is $1 to $2 lower and oil is 20 to 30 lower. Futures added weather premium this week due to the heat and concerns over the important soybean weather over the next 6 weeks. China is expected to remain active in secure fall supplies on break as we head into August as well. On the November chart support is at the 10-day at $10.16, which we are about a nickel above overnight, with the recent high at $10.47 above the market.

WHEAT

Wheat trade is narrowly mixed in quiet trade at midday, with the winter wheats trying build on the positive finish from Thursday, as trade has gotten pretty heavily oversold along with spread unwinding, while spring wheat has turned 7 to 10 lower. Spread trade remains soft for the winter wheat, and spring wheat continues to slowly add carry. Most world export business remains focused on the Black Sea area as harvest begins to progress there, with the dollar making new lows again this morning. Australia continues to see dryness, raising concerns for production in the coming months, but near-term supplies remain ample. On the December KC contract support is the 50-day at $5.09 with the 20-day at $5.44 resistance.

David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered Advisor.
He can be reached at dfiala@futuresone.com
Follow him on Twitter @davidfiala

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