DTN Midday Grain Comments 01/18 10:55
Corn, Soybeans Lower at Midday; Wheat Higher
Corn futures are 1 to 2 cents lower at midday Tuesday; soybean futures are
10 to 12 cents lower; wheat futures are 13 to 19 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow off 555 points. The U.S. Dollar
Index is 55 points higher. Interest rate products are lower. Energies are
firmer with crude up 1.15. Livestock trade is mostly lower. Precious metals are
weaker with gold off 4.00.
Corn futures are 1 to 2 cents lower at midday with trade bouncing back from
a test of the lows Tuesday morning and seeing firmer spread action to start the
week. Ethanol margins will continue to be squeezed by tepid short-term demand
with production expected to slide further as demand looks to remain soft into
next week. Basis should remain rangebound to slightly weaker in the short term
with weather likely to slow short-term movement. Trade will continue watching
South American weather more as we get closer to the key weather time frames on
new crop as well as soybean progress for the timing of double-crop planting
with some relief rains to the south. Weekly export inspections improved a bit
at 1.204 million metric tons (mmt). On the March contract we have resistance at
the 20-day moving average at $5.99, then the lower Bollinger band at $5.85 as
further support, which we bounced from Friday.
Soybean futures are 10 to 12 cents lower at midday with trade firming back
from the overnight lows with some relief rains in South American and a better
short-term forecast for the moment as early harvest expands with the December
crush report coming Tuesday morning as well. Meal is $3.00 to $14.00 lower and
oil is 25 to 35 points higher. Basis remains mostly flat in the short term.
Crush margins remain solid with future renewable diesel demand likely to keep
good support under oil going forward. Weekly export inspections bounced back
sharply at 1.720 mmt, and 239,486 metric tons (mt) were on the daily wire as
sold to Mexico. On the March soybean chart, we have resistance at the fresh
high at $14.15 which we scored a week ago, with trade fading below the 20-day
at $13.63 at midday with the lower Bollinger Band well below the current action
Wheat futures are 13 to 19 cents higher at midday with oversold conditions
and political worries helping push trade back off the lower end of the range
with action just off the highs at midday. The dollar is bouncing back to the
middle part of the range. Plains weather looks drier with a little snow cover
out of the last system, while temps continue to fluctuate, keeping stress
intact with other Northern Hemisphere weather concerns fading for the moment
while political fears ramp up again. Spring wheat is softer vs. Chicago, moving
the premium to $1.32 on the March, with KC at a 4-cent premium in flat action
as well. Weekly export inspections improved at bit at 369,188 mt. KC March
chart support is the lower Bollinger band at $7.34 with the 20-day moving
average at $8.00, still well above the market.
David Fiala can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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