DTN Midday Grain Comments 08/19 11:03
All Grains Lower at Midday
Broadly weaker grain trade at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are firmer with the Dow 290 higher. The dollar
index is 9 higher. Interest rate products are firmer. Energies are mixed with
crude up $0.85. Livestock trade is firmer. Precious metals are mixed with gold
Corn is 5 to 6 cents lower at midday with trade surrendering Friday's bounce
after rains across much of the belt, along with the start of the big crop tour.
Weather should continue to remain a short-term non issue. Ethanol margins
remain poor with blenders seeing the most short-term benefits with ethanol
futures drifting lower. Basis remains mixed overall with harvest getting
closer. Weekly export inspections remain soft at 510,334 metric tons. Weekly
crop progress is expected to show steady conditions, and lagging maturity. On
the September nearby chart support is likely the $3.59 low with the lower
Bollinger Band at $3.54 below that with resistance the 10-day at $3.83,
reflecting the break.
Soybean trade is 7 to 9 cents lower at midday with trade fading back to the
lower end of the range after the weekend rains. Meal is 1.00 to 2.00 lower and
oil is 35 to 45 points lower. Basis remains flat overall. The Brazilian ral is
recovering off of fresh lows scored last week and the Argentina peso still at
rock bottom prices. The weather looks to be a short-term non-issue for soybeans
as well coming forward. The trade situation remains little changed as well. The
weekly export inspections improved at 1.13 million metric tons. Weekly crop
progress will likely be steady conditions with maturity not catching up much.
September chart support is the lower Bollinger Band at $8.42, with the next
round up the 10-day $8.65.
Wheat trade is 2 to 5 cents lower, with Chicago trying to gain again, and
spring wheat harvest continuing along with spillover pressure from row crops.
The Kansas City/Chicago spread is at 78 after a high of 90 cents last week. The
corn/HRW spread is wider, back to 27 cents. Kansas City wheat is now back to
competitive on the world market trading at a discount to the lowest offers in
the most recent GASC tender. Spring wheat harvest should expand with winter
wheat just about wrapped up, with Europe continuing to move towards spring
wheat harvest as well. Weekly export inspections were 488,905 metric tons.
Weekly crop progress is expected to show winter wheat harvest effectively
complete, with spring wheat past the 25% mark. The September Kansas City chart
support is the new low at 3.80 3/4 with the first resistance the 4.00 area.
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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