DTN Midday Grain Comments 01/19 11:10
Corn, Beans Lower; Wheat Mixed
Corn is 5 to 6 cents lower, soybeans are 24 to 27 cents lower, and wheat is
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 80. The dollar index is 20
points lower. Interest rate products are firmer. Energies are mostly higher
with crude up $0.70. Livestock trade is mixed. Precious metals are firmer with
gold up $12.50.
Corn trade is 5 to 6 cents lower at midday with two-sided trade so far
turning weaker during the day session, with spread action still solid up front
with sales of 128,000 metric tons to Japan, and 100,000 to Israel announced.
Ethanol margins will remain poor with soft demand, and no major relief from
corn values short term. Basis is likely to weaken further as trade assesses
near-term cash needs. Weekly export inspections were ok at 876,774 metric tons.
On the March contract support is the gap area at $5.17 with the 20-day at $4.85
below that, with the next level up the upper Bollinger Band at $5.47, and the
contract high at $5.41 1/2 just below that.
Soybeans is 24 to 27 cents lower at midday with wild trade continued with
early positive trade giving way to a 31 cent break before trade rebounded with
better spread action before sliding again. Meal is 10.50 to 11.50 lower and oil
is 10 to 20 points lower. Basis mostly stabilized to end the week with crush
likely to take precedence over shipping in coming weeks with crush margins
narrowing overall and new crop seeing more interest in recent export bookings
with 132,000 metric tons to China. Brazil should catch rains short term, with
Argentina action mixed. Weekly export inspections were very strong at 2.058
million metric tons. The March chart has resistance at the fresh high at $14.38
then the upper Bollinger Band at $14.59, with support the overnight low at
$13.85, with the 20-day still well below the market at $13.30.
Wheat trade is narrowly mixed at midday with trade finding support from
Russian export taxes announced last week, along with a cap on Argentine exports
as well as food inflation remains a concern in many exporting countries but
early gains have faded with spillover from the row crop. The dollar remains
above 90 on the index with light selling to start the week. The plains are
expected to see limited moisture with cold scares remaining limited for now.
Kansas City is at 32-cent discount to Chicago after hitting the tightest level
in weeks and then reversing, with Minneapolis at -32 tightening back up from
early weakness. Weekly export inspections remain a bit soft at 276,898 metric
tons. Kansas City March chart support is the 20-day at $6.02, and resistance is
the fresh high at $6.60.
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