DTN Midday Grain Comments 08/31 11:14
Grains Mixed at Midday
Early strength gives way to mixed trade at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower with the Dow down 65 points. The
interest rate products are mostly higher. The dollar index is 6 points higher.
Energies are weaker with crude down 1.40. Livestock trade is mostly lower.
Precious metals are mixed with gold down $6.20.
Corn trade is flat to 1 cents higher at in quiet trade with a nickel range
so far, as early buying gave up mid-morning. Ethanol margins are softer this
morning with futures turning lower after weekly ethanol production came in
0.49% lower, with stocks .52% higher, and gasoline demand .21% lower. Corn
basis will remain on the defensive as harvest approaches with the last on farm
bushels moving to town. The crop is expected to continue to advance with warmer
temperatures as silage cutting moves through the belt and limited wet corn
harvest gets started in some areas. The USDA announced 275,000 metric tons of
corn sold to Mexico. On the chart, trade has support at the $3.14 3/4 low, with
resistance at the 10-day of $3.31 if the trade can find buying support, as the
trend remains down with successive new lows being put in.
Soybean futures are 4 to 8 cents lower at midday this morning with trade
testing the low end of the recent range. Meal is $1 to $2 lower and oil is 30
to 40 points lower. Trade will be looking for more export announcesmens with
the Chinese trade delegation visiting this week, as 187,000 metric tons of
beans were announced as sold to China on the daily wire. Early planting in
Brazil is now about two weeks away which will start attracting more attention
soon. Wetter weather in much of the belt should help the crop to finish out. On
the November soybean chart support was at the $9.60 low from Friday with the
200-day at $9.66 above that; longer term support is the $9.30 area from April,
with the $9.43 area of August support above that.
Wheat trade is mixed at midday as early short covering gave way to selling
during the day session. Canadian harvest will be hitting full stride soon, and
Russia looks to continue an aggressive export pace with ongoing issues in Egypt
causing problems, although Egypt has returned with another tender overnight.
Tunisa also secured some wheat and barely from the Black Sea this morning. The
USDA also announced a sale of hard red wheat to unknown of 125,000 metric tons.
U.S. spring wheat harvest should be nearing the end with spring wheat trade
finding more support early in the week. On the Kansas City December chart
support is now the $3.95 low from yesterday, with trade well below the nearby
moving averages. Chicago has printed a new contract low for the fifth day in a
row, which Kansas City holding back above Chicago values.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered trading adviser.
David Fiala can be reached at firstname.lastname@example.org
Follow David Fiala on Twitter @davidfiala
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