DTN Midday Grain Comments 09/24 11:36
Wheat, Corn Higher at Midday
Corn has extended the bounce to begin the week, while beans have remained
red since the opening last night to midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower with the Dow futures down 150. The
interest rate products are firmer. The dollar index is 15 lower. Energies are
firmer with crude up 1.40, unleaded up 4 cents and ethanol mixed. Livestock
trade is weaker with only nearby hogs firmer. Precious metals are mixed with
gold up $2.
Corn trade is 1 to 2 cents higher at midday with trade firmer after seeing
two-sided trade overnight. Mother Nature is providing some wet harvest
conditions which are noted slowing harvest progress in many areas, with a few
spots moving along quickly. Ethanol margins remain tight with production likely
to fade near term due to the higher corn and lack of upside movement in
ethanol. Crude and RBOB are firmer so blender margins continue to look good.
Corn basis will likely see more pressure harvest here in the near term but
delays could limit pressure. The weekly export inspections were strong at 1.263
million metric tons. The weekly crop progress should show steady conditions,
above average maturity, and harvest close to average. On the December chart
futures support moved above the 10-day, at $3.52, on Friday then 20-day at 3.58
today which are our support levels at midday. Resistance is at the $3.67 1/2
50-day then the $3.69 3/4 1-month higher.
Soybean trade is 3 to 5 cents lower at midday with trade up 3 to 5 from the
early lows. China trade issues flaring up again in the news over the weekend as
tariffs take effect. Meal is $1.50 lower, and oil is 35 to 45 points higher at
midday. Soybean basis remains historically wide across the belt with storage
and shipping concerns continuing to dominate with the recent uptick in fresh
sales needing to be sustained with another 162,000 metric tons announced this
morning. Crush margins remain strong with oil starting to show broader
strength. Early planting in South America is underway with conditions on the
dry side going in but no major concerns expected at this juncture. The
Brazilian and Argentine currencies remain historically cheap. China lowered
tariffs on neighboring countries which could offer some more work-a-rounds on
trade with US/China trade talk progress remaining at a standstill. The weekly
crop progress is expected to show steady conditions, ahead of normal maturity
and average harvest progress. The weekly export inspections were in line with
recent weeks at 693,860 metric tons. On the November chart support is the
20-day at $8.37 with the 10-day below that at $8.34, with resistance the recent
high at $8.55.
Wheat trade is 1 to 3 cents higher at midday with with the weaker dollar and
world prices adding support. Trade was unable to extend the early morning
strength though. The US dollar is at the bottom of the recent range but firmer
this morning. Russia will continue to work on spring wheat harvest and winter
wheat planting with little change in the weather patterns, with harvest in
Canada impacted by snow as well. Australia looks to continue the recent weather
pattern with more feed grain imports possible. The weekly export inspections
remained in line with recent weeks at 409,452 metric tons. The weekly crop
progress is expected to show spring wheat harvest complete, and winter wheat
planting near average. On the December Kansas City chart, we have support at
the 10-day at $5.19 with resistance at the 200-day at $5.43.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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