DTN Midday Grain Comments

General Comments

The U.S. stock market indices are mixed with the Dow futures down 6 points. The interest rate products are mostly higher. The dollar index is 38 lower. Energies are mostly mixed with crude down 0.70. Livestock trade is mostly lower. Precious metals are higher with gold up $5.

CORN

Corn trade is 4 to 5 cents lower at midday to open the week with trade chopping lower as rain works across Iowa this morning, and with crop tours heading out today. Ethanol margins remain solid with the corn and energy complex moving in tandem in recent days with the end of summer-driving season rapidly approaching. Ethanol futures are edging slightly higher this morning. The USDA weekly Crop Progress report is expected to show steady conditions and maturity remaining behind normal, with weekly export inspections softer at 691,442 metric tons of corn. On the December chart, support is the new low at $3.61, touched this morning with the contract low at $3.58 1/4 below that. Resistance is at the 10-day moving average at $3.72.

SOYBEANS

Soybean trade is 2 to 4 cents lower at midday with trade setting back on the rains working across Iowa this morning, although follow-up systems are expected to be limited. Meal is $2 to $3 lower, and oil is 30 to 40 points higher. The weekly Crop Progress report is expected to show steady to lower conditions, and maturity just above normal. The weekly export inspections were better at 665,283 metric tons, with new-crop sales of 198,000 and 463,000 to China and unknown. On the November chart, support is at the fresh low for the move at $9.21, then the one-year low printed in June at $9.07. The 10-day moving average is chart resistance at $9.50.

WHEAT

Wheat trade is 5 to 12 cents lower with winter wheat holding up better after the cold snap in Australia raised frost concerns. The dollar rally has faded further, which should help to keep the U.S. more competitive with Russian logistical bottlenecks coming forward with their big crop with U.S. soft wheat the most competitive on gulf origin. Spring wheat harvest should move past the halfway point with harvest pressure likely to ease coming forward. Weekly export inspections were OK at 583,126 metric tons. Trade is heavily oversold, which should translate into bigger short covering at some point ahead of winter wheat planting. On the December KC contract, support is the $4.35 fresh low with resistance at the 10-day at $4.61.

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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