DTN Midday Grain Comments 10/16 11:38
Grains Mixed to Lower at Midday
Row crops are holding near the daily lows at midday, wheat is mixed.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are firmer with the Dow futures up 370. The
interest rate products are mostly higher. The dollar index is 8 lower. Energies
are mixed with crude down 0.15. Livestock trade is mixed with hogs leading.
Precious metals are mixed with gold up 1.90.
Corn trade is 3 to 4 cents lower overnight with trade pulling back from the
fresh highs scored to open the week with spillover pressure from soybeans. More
open weather should return this week, but will take a bit to get everyone back
up to speed. Ethanol margins remain tight with ethanol futures still struggling
to extend gains, with futures falling back to $1.28 this morning. Corn basis is
expected to stay sideways with wet weather limiting weakness in some areas. The
weekly crop progress showed unchanged conditions at 68% good to excellent, and
12% poor to very poor, 96% mature, 5% ahead of average, with 39% harvested, 4%
ahead of average. On the December chart support is at the 100-day at 3.73, and
the 200-day next resistance at $3.88.
Soybean trade is 7 to 10 cents lower with trade pulling back from the fresh
highs scored yesterday with harvest starting to resume. Meal is $3.50 to $4.50
lower and oil 10 to 20 points lower. Soybean basis will likely see pressure
again later in the week as farmers get back into the fields. Crop losses from
the weather will likely take a while for trade to sort out, which will likely
trigger volatile trade, especially with overbought conditions. Crush margins
remain strong with September crush another record at 160 million bushels. South
America should continue to see fairly normal early season progress in the near
term with good moisture with the biggest concerns in Argentina. The weekly crop
progress showed conditions down 2 percentage points at 66% good to excellent,
and 12% poor to very poor, 95% dropping leaves, 3% ahead of average, and
harvest at 38%, 15% behind average. On the November chart support is the 10-day
at $8.67, with resistance the 100-day at $8.89 that we tested on Monday but
Wheat trade is narrowly mixed with Chicago trade leading at midday with
gains from the last two days holding for the most part. The U.S. dollar has
faded back below 95 with some light selling to start the week. World spring
wheat harvest is nearing completion, while winter wheat planting is ongoing
with better conditions in North America than Europe with plenty of moisture on
the plains. Australia remains in the recent weather pattern with some relief in
the drier areas. The weekly crop progress showed planting at 65%, 2 percentage
points behind average, and emergence at 44%, 3 percentage points ahead of
average. MATIF milling wheat is flat to lower this a.m. On the December Kansas
City chart, we are just above the 10-day and 20-day at 5.21 with the lower
Bollinger Band support at 5.09, and resistance the upper Bollinger Band at
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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