DTN Midday Grain Comments 10/23 11:37
Grains Lighly Mixed at Midday
Corn, soybeans, and wheat are flat to lower at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are weaker with the Dow futures down 420. The
interest rate products are weaker. The dollar index is 15 lower. Energies are
weaker with crude down 2.15. Livestock trade is mixed with hogs higher and
cattle lower. Precious metals are mixed with gold up $12.
Corn trade is narrowly mixed in quiet trade midday with trade looking to
hold the support found to open the week. Outside markets are negative limiting
upside. The harvest pace should be good the next few days with the more open
weather expected to persist into late October. Some forecasts have started to
drift wetter towards the end of the month, which is keeping combines rolling as
much as possible. Ethanol margins remain tight with futures below $1.30 a
gallon, and further energy complex weakness here at midday. Corn basis should
see some pressure with better harvest pace. The weekly crop progress showed
harvest at 49%, 2 percentage points ahead of average with conditions unchanged
at 68% good to excellent, and 12% poor to very poor. On the December chart
support is at the 20-day at $3.68 then the 50-day at $3.65. Resistance is at
the 10-day at $3.71 then the $3.78 1/2 recent high.
Soybean trade is flat to 2 cents lower at midday with trade bouncing back
from some of the early weakness. Meal is $2 lower and bean oil is 25 to 35
points lower. Soybean basis will likely see pressure with harvest continuing to
expand with some areas wrapping up. Quality concerns remain at the forefront as
well, with some areas showing more damage than others. Crush margins remain
strong in the near term. South America should continue to see fairly normal
early season progress in the near term with good moisture with the biggest
concerns in Argentina, and potentially NE Brazil longer term. The Brazil real
has held near the upper end of the recent range, keeping effective nearby
values well above the U.S. The weekly crop progress left conditions unchanged
at 66% good to excellent, 12% poor to very poor with harvest at 53%, 14% behind
the five-year average. On the November chart support is the 50-day at $8.55
which we have tested this morning, with the lower Bollinger band at $8.40
support, and resistance the 20-day at $8.63.
Wheat trade is flat to 2 cents with trade continuing to test the lower end
of the range with the ongoing oversold conditions. The US dollar has faded
slightly this morning with world wheat values again steady to firmer. Winter
wheat planting is ongoing with better conditions in North America than Europe
with some relief in the Black Sea areas. Prevent Planting dates are approaching
soon on the plains. Australia remains in the recent weather pattern with
harvest coming soon, MATIF milling wheat is firmer this morning. Planting
progress was rated at 72%, 5 percentage points behind average, and emerged at
50%, 5 percentage points behind average. On the December Kansas City chart, we
are below at the 10-day and 20-day at 5.21 with the lower Bollinger Band
support at 5.05, and then $5.00.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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