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DTN Midday Grain Comments 05/16 10:51
Grain Futures Seeing Green Midday Monday
Corn trade is 13 to 20 cents higher; beans are 9 to 11 cents higher and
wheat is 53 to 70 cents higher.
David M. Fiala
DTN Contributing Analyst
MARKET SUMMARY:
The U.S. stock market is weaker with the S&P down 30 points. The U.S. Dollar
Index is 0.05 lower. Interest rate products are mostly higher. Energies are
firmer with crude with crude $1.10 higher and natural gas up $0.30. Livestock
trade is mostly higher. Precious metals are mixed with gold up $3.40.
CORN:
Corn trade is 13 to 20 cents higher at midday Monday with trade pushing back
into fresh highs after briefly softening a bit. The export wire has been quiet
with trade looking for when value buyers start to show up, with the rebound
likely to limit that again short term. The ethanol margins will continue to be
squeezed by input costs with soft driving demand and still burdensome stocks
short term. The second crop in Brazil will head for the homestretch with drier
weather in much of Brazil while the U.S. weather remains challenging for many
short term, with cooler weather to the north limiting drying. The weekly export
inspections faded slightly again to 1.037 million metric tons, with weekly crop
progress expected to show a good jump on planted acres but will remain well
behind average, with emergence following suit. On the July contract chart, we
have resistance at the 20-day moving average at $7.96, which we are just above
at midday with the height at $8.24 1/2 above that, then the lower Bollinger
Band at $7.72 as support.
SOYBEANS:
Soybean trade is 9 to 11 cents higher at midday with trade fading off the
overnight highs as November action works to consolidate above $15.00, with July
remaining well off the highs. Meal is $5.00 to $6.00 higher and oil is 1.00 to
1.15 cents lower. South American is moving toward post-harvest footing at this
point, with better progress likely made on U.S. planting last week, although we
will likely remain behind average on the weekly report with emergence lagging
as well, with weekly export inspections soft at 784,187 metric tons. New crop
November continues to lose ground to corn short term as well with planting
delays lessening the urgency of competition for now, with better-than-expected
corn progress needed to push trade. USDA announced 132,000 metric tons of old
crop soybeans sold to China, breaking the recent silence on the daily wire on
Friday, but nothing announced Monday. On the July soybean chart, we are just
below the 20-day at $16.56 with the $17.00 area as the next level of
resistance, and further support at the lower Bollinger Band at $15.79.
WHEAT:
Wheat trade is 53 to 70 cents higher at midday with trade pulling back from
the initial limit-higher surge as India formalized export restrictions while
expecting to honor previously booked contracts, while weather remains
concerning in the Northern Hemisphere, and little changes on the Ukraine/Russia
front for now. The dollar remains at the upper end of the range but has done
little to limit upside so far. KC wheat is back to a 30-cent discount to
Minneapolis in narrower action, and at a 100-cent premium to Chicago, holding
at the high end of the range. Weekly export inspections remained range bound at
348,048 metric tons, with winter wheat conditions steady and heading catching
up closer to average with the recent heat, while spring wheat planting and
emergence will continue to lag well behind average. The KC July chart has
resistance at the fresh high at $13.52, with support the upper Bollinger Band
at $12.89 with the 20-day well below the market at $11.72.
David Fiala can be reached at dfiala@futuresone.com
Follow him on Twitter @davidfiala
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