DTN Midday Grain Comments 08/05 10:49
Corn, Soybeans Up Midday Thursday
Corn is 8 to 13 cents higher, soybeans are 10 to 13 cents higher and wheat
is 1 cent lower to 3 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 195 points. The U.S. Dollar
Index is 0.05 lower. Interest rate products are weaker. Energies are firmer
with crude up $0.90. Livestock trade is weaker with hogs sharply lower.
Precious metals are mixed with gold down $9.30.
Corn trade is 8 to 13 cents higher with corn once again migrating back to
the $5.50 area and then higher with stronger spread action helping to find
buying. Ethanol margins will continue to see pressure with energies sliding
along with the coming shift to cheaper fall blends, while corn remains
rangebound. Brazil will continue to move along with the end of the second crop
season and harvest to expand soon with export estimates being cut again. Corn
basis continues to fade with cash inverses likely to see more pressure as early
harvest gets going to the south. Weekly export sales showed improvement at
68,200 metric tons of old crop and 830,200 of new crop. On the September
contract, we have moved back above at $5.53 20-day moving average, which we
went just below overnight with the upper Bollinger Band at $5.75 the next round
Soybeans are 10 to 13 cents higher at midday with trade bouncing off support
levels and little fresh news to move the market as we await further rains to
push the crop into pod fill in many areas. Meal is $4.00 to $5.00 higher and
oil is 0.10 cent to 20 cent higher. The weather pattern looks dry short term
with better rains the second week. South America has a declining ship line up
while the run in canola values turned more sideways, keeping a lid on oil
values as well, along with crude oil weakness with meal still unable to sustain
rallies. Basis levels have been flat to weaker in recent days. Weekly export
sales improved at bit at 11,400 metric tons old crop and 424,800 of new, with
meal at 135,400 old and 18,700 new, and oil at 3,200. On the September soybean
chart, resistance is at the 20-day at $13.66, which we fell below last week,
with the lower Bollinger Band at $13.19 as support with $13.00 below that.
Wheat trade is 1 cent lower to 3 cents higher at midday with trade working
to consolidate the upper end of the range short term with Minneapolis wheat the
leader by a touch. The dollar has settled into a range around 92 points on the
index, keeping currency input more neutral. The U.S. has pushed above world
values, which should limit exports and upside short term, unless continental
values can catch up further. KC holds at 27 cent-discount to Chicago, widening
a bit with Minneapolis at a 183-cent premium fading back to the lower end of
the range. Weekly export sales were a bit at softer at 308,300 metric tons. KC
September on the chart has support at the 20-day at $6.55 with resistance the
upper Bollinger Band at $7.16.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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