DTN Midday Grain Comments 12/08 10:45
Corn Flat, Beans Up Midday Wednesday
Corn trade is flat to 1 cent higher, beans are 6 to 8 cents higher and wheat
is 14 cents lower to 1 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow off 95 points. The U.S. Dollar
Index is 0.40 lower. Interest rate products are lower. Energies are firmer with
crude up $0.30. Livestock trade is weaker. Precious metals are mixed with gold
Corn trade is flat to a penny higher with range-bound action continuing, and
a sale of 1.844 million metric tons of corn to Mexico on the daily wire of
mostly old crop. Ethanol margins should remain in the current range until after
the Christmas driving season, with support from cheaper natural gas and the
weekly report showing production 55,000 barrels per day higher; stocks were up
by 163,000 barrels per day. Basis should remain steady to firmer short term
with fall field work on the homestretch. On the March contract, we have support
at the 20-day moving average at $5.81, which we are just above, then the upper
Bollinger Band at $5.92 as further resistance.
Soybean trade is 6 to 8 cents at midday with trade bouncing back off the
lower end of the range and China securing 130,000 metric tons on the daily
wire, while meal carries the product trade so far. Meal is $6.00 to $7.00
higher and oil is 1.00 cent to 2.00 cents lower. South America looks to
continue short-term progress with issues remaining limited for now, and
short-term dryness expected in the southern growing areas for the balance of
the week. Crush margins remain solid but further product weakness would limit
enthusiasm with oil back at the lower end of the range. Basis remains mostly
flat near term. On the January soybean chart, we slipped back below the 20-day
at $12.50 before firming back at midday, with further support the lower
Bollinger Band at $12.14.
Wheat trade is 14 cents lower to 1 cent higher at midday with trade chopping
along the lower end of the range. The dollar is just above 96 points,
continuing to hold the upper end of the range with calmer and weaker trade.
Weather in the Plains looks little changed short term with longer-term dry
concerns for the Southern Plains heading towards dormancy and mixed forecasts
in Australia short term as harvest expands with various Black Sea area concerns
still in place. Spring wheat is firmer versus Chicago moving the premium to
2.40 cents on the March, with KC at a 16-cent premium in weaker action so far.
KC March chart resistance is at the 20-day at $8.39 with the recent low at
$8.08 as the first level of support.
David Fiala can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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