DTN Midday Grain Comments 09/16 11:09
All Grains Higher at Midday
Wheat and corn lead firmer trade at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow 135 lower. The dollar index is
400 points higher. Interest rate products are weaker. Energies are sharply
higher with crude up $6.00. Livestock trade is mixed. Precious metals are mixed
with gold $10.00 higher.
Corn is 3 to 5 cents higher with buying building during the day session.
Weather remains a short-term non-issue with higher temps and wetter weather to
the north before trending drier. Corn basis should start to see more pressure
with harvest underway in more areas. The expected ethanol policy announcements
have yet to come this week with hints towards larger quotas to offset waivers,
with blender margins seeing a big boost from the the jump in unleaded this a.m,
and ethanol futures 2 cents higher. Weekly crop progress should show steady
conditions with some catch-up in maturity with the warmer weather. The weekly
export inspections remained soft at 421,083 metric tons. On the December
contract, support is at the 20-day at 3.65 with the upper Bollinger Band above
trade at 3.77.
Soybean trade is flat to 2 cents higher with trade initially moving higher,
but failing to hold above $9.00 again. Meal is 2.00 to 3.00 lower and oil is 70
to 80 points higher. Crush margins remain positive overall with meal testing
$300 a ton again overnight before fading. The positive export story needs China
coming forward as U.S. export competitiveness improves on the world market with
active bookings off the PNW the last few days with 256,000 metric tons on the
daily wire today. Bean basis remains flat in the interior. South American
currencies remain weak as planting season draws closer. Weekly crop progress
should show steady conditions, and some gains in maturity, with export
inspections disappointing at 666,490 metric tons. On the November chart we are
have support at the 50-day at $8.84 and the upper Bollinger Band at 8.91, with
resistance the 200-day at 9.15.
Wheat trade has found better buying at 2 to 8 cents higher with Kansas City
leading at midday with spillover support and seasonal action. The Kansas
City/Chicago spread is at 81, back at the high end of the range. The corn/HRW
spread is tight, hanging around the 34 cent area, starting to narrow again.
Kansas City wheat is competitive on the world market but we need to see the
business and more buyers to move the board out away from our lows with feed
competitiveness improving again. Spring wheat harvest is on the home stretch.
Weekly crop progress should show spring wheat harvest near the end, with winter
wheat planting starting to get underway soon. The weekly export inspections
were rangebound at 459,258 metric tons. The December Kansas City chart support
is at the 20-day at $3.99 3/4, with resistance at the upper Bollinger Band at
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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