DTN Midday Grain Comments 07/16 11:38
Soybeans Leading Grains at Midday
Soybeans are posting double-digit gains at midday, corn is flat, and wheat
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed with the Dow up 5. The interest rate
products are firmer. The dollar index is 20 points lower. Energies are weaker
with crude down 2.65. Livestock trade is mixed with cattle leading. Precious
metals are weaker with gold down $2.20.
Corn trade is flat at midday with two-sided trade so far with generally
positive trade during the day session. Cooler weather looks to hang around the
next couple weeks. Ethanol board margins remain positive with some pressure
from crude with ethanol futures edging higher to narrow blender margins. Corn
basis has been flat to firmer in recent days with the lower board. The weekly
export inspections were on the lower end of the range at 1.217 million metric
tons. The weekly crop progress report is expected to show slightly lower
conditions and maturity well ahead of normal. On the September chart we remain
below the 10-day at $3.48, with the 20-day at $3.55 the next round up. Support
is the fresh low of $3.37 scored yesterday with the lower Bollinger Band at
$3.38 above that.
Soybean trade is finding good short covering this morning with soybeans 12
to 16 cents higher at midday after fresh lows overnight. Meal is $6 to $7
higher and oil 25 to 35 points lower. Brazil remains at a stout premium to US
origin, which is compounded by the ongoing logistics issues with Brazil with
premiums around $1.90 right now. Bean basis has remained steady with processors
taking the lead. The daily export wire has remained quiet. Weather shouldn't be
a major driver near term for soybeans but podfill will be here soon. Weekly
export inspections were good seasonally at 635,429 metric tons. Weekly crop
progress is expected to show slightly lower conditions with maturity well above
normal. On the August chart, the 10-day at $8.43 is again the first level of
resistance which we are still below at midday with further support the lower
Bollinger Band at 8.11 with the next level resistance the 20-day at 8.63.
Wheat trade is 4 to 8 cents lower at midday with trade struggling again to
open the week. Harvest progress should continue to push along with the
homestretch ongoing for the plains. Spring wheat should see good progress with
Canada with drier weather showing up again. Russian harvest continues to move
along as well with production estimates dropping another 3 million metric tons.
HRW basis has remains solid through harvest with the better protein with
offered premiums declining. The weekly export inspections improved at 469,523
metric tons. Weekly crop progress is expected to show winter wheat harvest past
70%, with spring conditions steady with conditions above normal. On the
September chart, Kansas City was able to finish last week just below the 10-day
moving average at $4.90 with the 20-day the next resistance at $4.93.
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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