DTN Midday Grain Comments 08/21 10:57
Grains Lower at Midday
Trade is lower at midday, led by wheat and corn.
By David Fiala
DTN Contributing Analyst
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 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.
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 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 firstname.lastname@example.org
Follow him on Twitter @davidfiala
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