DTN Midday Grain Comments 06/21 12:00
Grains Mixed at Midday
Mixed midday trade is seen with active trading ranges on the session.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower with the Dow down 155. The interest
rate products are lower. The dollar index is 22 points lower. Energies are
lower with crude down $0.30. Livestock trade is lower. Precious metals are
Corn trade is 1 to 2 cents higher at midday with trade again fighting off an
attempt to break lower overnight. The overnight to midday trading range is over
a dime and we are a few cents off the high here at midday. Outside markets have
the dollar, crude and the stock market all lower giving mixed market direction
to the grain trade. Harvest should continue to expand in the double crop areas
of Brazil with open weather continuing, while Black Sea area corn remains
mostly dry. U.S. weather looks to remain wet in the near term, with heat still
showing in the extended forecast, along with good moisture prospects. Ethanol
blending margins remain exceptionally strong with unleaded trading at a 60 cent
premium to ethanol. Basis has been flat to firmer in recent days with the lower
board. The weekly export sales were low at 165,900 tons of old crop and 339,700
of new. Reductions of primarily unknown destinations totaled 584,700 tons. On
the July chart we remain below the 10-day, at $3.64 which is now nearby
resistance and then the 200-day at $3.82. Nearby support is the $3.44 lower
Bollinger Band then the $3.38 3/4 spike low from Tuesday.
Soybean trade is 3 to 5 cents lower with trade coming back from dime lower
trade overnight. Meal is flat to $1 lower and oil is 15 to 20 points lower.
Trade concerns will continue to fuel volatility with little fresh news on that
front overnight. Bean basis has remained steady to firmer, with trade likely to
remain quiet in the near term as old crop exports remain slow with Brazilian
values remaining strong on the anticipation of future business. Widespread
rains should boost near term growth. Brazil continues to struggle with the
logistical issues compounded by the trucker strikes with a large shipping line
up. The weekly export sales were in line with expectations at 301,700 tons of
old crop and 227,600 tons of new. Meal sales were at 115,100 tons and bean oil
at 16,000. On the July chart support is at lower Bollinger band at 8.63, and
resistance the 10-day at $9.22.
Wheat trade is 4 to 6 cents higher at midday with harvest pausing for rains,
while weather concerns build in Russia with trade bouncing back from the
overnight weakness. Wet weather for Kansas should slow harvest in the next week
or so, with good overall progress so far and much of the eastern part of the
state wrapped up, and heat returning next week to finish harvest. Spring wheat
should see good progress with Canada remaining drier. Australia should see some
improvement but overall remains mixed. Russian winter wheat is likely to remain
on the dry side, with the spring wheat cool and wet with growing concerns
there. HRW basis has remains solid ahead of the anticipated harvest protein
improvement and board weakness. The weekly export sales were within
expectations at 461,600 tons. On the July chart, Kansas City is back below all
the major moving averages with the 200-day at $4.96 the closest to the market,
and $4.71 becoming support as the fresh low.
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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