DTN Midday Grain Comments 10/19 11:27
Grains Trending Higher at Midday
Wheat is the leader at midday with trade lightly higher across the board.
By David Fiala
DTN Contributing Analyst
The U.S. stock market is lower this morning with the Dow down 55 points. The
interest rate products are higher. The dollar index is 25 lower. Energies are
lower with crude down $0.45. Livestock trade is mostly higher. Precious metals
are mixed with gold up $7.70.
Corn trade is flat to 2 cents higher at midday with range bound trade
continuing yet again. Ethanol margins are under a little bit of pressure this
morning, with ethanol futures back to $1.40. Basis should see harvest pressure,
while carry remains at wide levels. Weather looks to remain open and better
this week for drying corn with some weekend rains possible. Corn moisture has
been one of the biggest near term concerns as it has stayed stubbornly high in
some areas keeping the harvest focus on soybeans. The weekly export sales were
stronger at 1.25 million metric tons. On the December chart support is at the
$3.42 1/2 low with resistance at the $3.55 50-day moving average.
Soybean trade is flat to 4 cents higher with light buying continuing in the
early day session with 384,000 metric tons of soybeans going to China hitting
the daily wire. Meal is flat to $1 lower and oil is 35 to 45 points higher.
South American weather forecasts continue to show an uptick in moisture for
northern Brazil in the extended forecast with the wetter areas drying out,
which should boost planting progress. Harvest should be well past the halfway
point now, with open weather for the rest of the week. The weekly export sales
remained solid at 1.28 million metric tons with meal sales at 296,000 metric
tons, and 27,400 of oil. On the November chart, trade is above all the major
moving averages, with the 200-day at $9.75 support, with resistance the recent
high at $10.03.
Wheat trade is 2 to 7 cents higher at midday with trade remaining range
bound in more active trade. The dollar has turned solidly lower this morning,
moving back below $93 on the index. U.S. exports have been slowed lately as
Black Sea origin continues to dominate but exports exceeded expectations at
615,400 metric tons. Australia will see more focus coming forward as well as
the growing season progresses with some flood damage concerns in South America.
Planting progress should pick up substantially for winter wheat this weeks,
along with warmer weather supporting emergence. On the December Kansas City
support is the lows at $4.20 after the 10-day at $4.32 being tested to the
upside this morning with further resistance at the 20-day at $4.39.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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