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DTN Midday Grain Comments 08/18 10:56
Corn, Beans Seeing Green; Wheat in the Red Midday Thursday
Corn trade is 5 to 6 cents higher; beans are 16 to 19 cents higher and wheat
is 22 to 32 cents lower.
David M. Fiala
DTN Contributing Analyst
MARKET SUMMARY:
Corn trade is 5 to 6 cents higher; beans are 16 to 19 cents higher and wheat
is 22 to 32 cents lower. The U.S. stock market is mixed with the Dow down 30
points. The U.S. Dollar Index is 0.40 higher. Interest rate products are
firmer. Energies are mostly higher with crude up 2.40. Livestock trade is
weaker. Precious metals are mixed with gold $2.00 lower.
CORN:
Corn trade is 5 to 6 cents higher at midday Thursday with buying starting to
develop during the day session after early weakness as trade follows the lead
of soybeans. Short-term forecasts have the center of the belt drier with milder
temperatures short term. The export wire remains quiet with export sales
showing improvement at 99,300 metric tons of old crop and 750,000 of new crop.
Ethanol margins will continue to be limited by driving demand and seasonal
slowdowns with unleaded futures finding support in recent days to keep blender
margins flat while natural gas remains near the highs, hurting some plants
margins. Basis will be watched to see how much further strength fades
especially with the board rally and harvest starts in the South with mixed to
lower yields and aflatoxin concerns so far. On the September chart, support is
the 20-day at $6.08 and the upper Bollinger Band is the next round up at $6.41.
SOYBEANS:
Soybean trade is 16 to 19 cents higher at midday with spreads flattening out
as broad buying returns during the day session with meal leading the product
side to support crush margins. Meal is $9.00 to $10.00 higher and oil is 1.05
cents to 1.25 cents lower. Biodiesel margins remain positive but narrowing in
recent days with overall crush margins good. South America is on post-harvest
footing for shipping with their advantage to persist until September with
nothing on the daily wire Thursday, while the bulk of the U.S. is heading into
the start of podfill season with less stressful weather this week temperature
wise, with follow-up moisture limited for most of the west. Basis has been more
mixed as we head towards harvest. Weekly export sales showed some strength as
well with 96,900 metric tons of old crop, 1.3 million of new, with 66,600 of
old meal, 296,700 of new, and 1,600 of oil. On the September soybean chart,
support is the 20-day at $14.53, which we are well above while November has
edged back above the 20-day at $14.04, with the upper Bollinger Band at $15.58,
which we have faded from as resistance.
WHEAT:
Wheat trade is 22 to 32 cents lower at midday with early gains giving way to
fresh lows being scored as selling picks up in low volume, with fresh bullish
news lacking and liquidation after trade failed to extend gains Wednesday,
along with wheat being the short leg of spreads and hints of possible broader
progress in Black Sea geopolitics. Weather in the Plains looks for better
short-term moisture with deficits needing to be eased ahead of planting for
Oklahoma and Texas, while spring wheat harvest should expand significantly this
week. The dollar is rebounding a bit with mixed inflation ideas along short
term with Egypt making some purchases without tenders while MATIF values fade
further in low volume. Weekly export sales were softer at 207,200 metric tons.
The KC September chart has resistance at the 20-day at $8.63, which we broke
below Thursday morning, with the fresh lows at $8.07 scored Thursday morning as
support.
David Fiala can be reached at dfiala@futuresone.com
Follow him on Twitter @davidfiala
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