DTN Midday Grain Comments 09/17 11:37
Corn, Soybeans Lower at Midday; Wheat Mixed
Trade is lower at midday with early wheat gains fading.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are weaker with the Dow futures down 10. The
interest rate products are mixed. The dollar index is 40 lower. Energies are
mostly higher with crude up 0.05. Livestock trade is mixed after early
pressure. Precious metals are firmer with gold up $6.50.
Corn trade is 3 cents lower with trade easing into new lows on the December
contract to start the week. Wetter near-term weather may slow harvest progress
in the center of the Corn Belt later this week. Ethanol margins remain tight
with futures still on the low end of the range, while the blender margins
remain solid. Corn basis will likely see more harvest pressure here in the near
term. The weekly progress report is expected to show steady conditions with
maturity and harvest ahead of normal. The weekly export inspections were good
at 1.03 million metric tons. On the December chart, support is at the low at
$3.48 1/4 with the 10-day at $3.60 as resistance.
Soybean trade is 4 to 6 cents lower at midday with pressure from the ongoing
trade concerns and early harvest. Meal is $2.50 to $3.50 lower, and oil is flat
to 10 points lower. Soybean basis is expected to see more pressure as storage
space will be at a premium once harvest gets rolling with rain delays possible
later this week. Crush margins remain even as meal fades from the highs, along
with outstanding biodiesel margins. Early planting in South America will be
getting underway soon with conditions on the dry side going in but no major
concerns expected for a while. Brazil and Argentina currencies remain
historically cheap with the real falling back to the lows. U.S. and Brazil
offers are near parity to China even with the tariffs. The second round of
trade aid is being targeted for early December. Weekly Crop Progress is
expected to show steady conditions and maturity above normal. The daily wire
had 241,000 metric tons of soybeans sold to unknown. The weekly export
inspections ran in line with recent weeks at 784,752 metric tons. On the
November chart, support is fresh lows at $8.21 scored Wednesday and tested this
morning, with the 10-day at $8.37 and the 20-day at $8.46 noted resistance
Wheat trade is mixed at midday with trade mostly holding the gains from
Friday so far. The U.S. still struggling to secure export business but should
be positioned better soon with world tenders solidly higher last week. The U.S.
dollar is at the bottom of the recent range. Russia is expected to catch some
rain in the near term while they try to cut spring wheat and plant winter wheat
with some snow in Siberia. Australia looks to have more mixed weather in the
near term with longer-term dryness still an issue as we get closer to harvest
there, and some frost in Western Australia. Matif milling wheat is firmer this
morning as well. The weekly Crop Progress report should show winter wheat
planting near average and spring wheat harvest nearly wrapped up. Weekly export
inspections were in line with recent weeks at 406,004 metric tons. On the
December KC chart, we have support at the lower Bollinger Band at $4.95 with
resistance the 10-day at $5.19.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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