DTN Midday Grain Comments 06/26 11:07
Grains Mixed at Midday
Trade has faded back to mixed action at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are firmer with the Dow 50 higher. The dollar
index is 8 lower. Interest rate products are firmer. Energies are firmer with
crude 1.65 higher. Livestock trade is mostly higher led by feeder cattle.
Precious metals are weaker with gold 3.90 lower.
Corn trade is 1 to 3 cents lower at midday with trade remaining rangebound
as we draw closer to the report on Friday. The forecast looks to trend towards
warmer and drier into July which will be needed to boost growth. The weekly
ethanol report showed production off by 9,000 barrels per day, and stocks down
48,000 barrels. Corn basis remains on a firmer trend, especially for the
Eastern Belt. Looking ahead to the report on Friday expectations are for 86.62
million acres of corn on a range of 82 million to 89.8 million vs, 92.79
million in March, with stocks at 5.35 billion on a range of 5.174 to 5.90
billion, with full prevent plant not expected to be incorporated until August.
On the July nearby chart support is the 10-day at $4.47 which we are test at
midday, with the 20-day at $4.35 below there. Resistance is the upper Bollinger
Band at $4.61.
Soybean trade is 2 to 4 cents lower with range bound trade continuing with
little fresh news today. Meal is 1.50 to $2.50 lower and oil is narrowly mixed.
Crush margins remain solidly positive overall with meal regaining the lead to
start the week and oil leading today. World export demand remains slow, with
the real remaining near the upper end of the range but still cheap vs. the
dollar, but the USDA did announce 145,000 metric tons of old crop sold to
unknown. Field work will likely be slowed again in many areas with days now
getting shorter for soybean growth. The report is expected to show soybean
acres as 84.35 million on a range of 81 million to 86.5 million. Stocks are
expected to be 1.861 billion bushels on a range of 1.7 billion to 1.962
billion. The July chart support is the 100-day at $8.93 with the 200-day above
the market at 9.07 which we failed to hold.
Wheat trade is 3 to 8 cents higher at with harvest for winter wheat expected
to expand more towards the weekend with delays still in place today. The Kansas
City/Chicago spread has widened to new records again this a.m. The warmer
weather should get combines moving more in the short term with above 90 degrees
expected for the Plains. The dollar is below 96 on the index with the slide
arrested for now. Black Sea area weather remains mixed with world values soft
and short term heat in place. Hard red wheat is working into feed rations in
some areas with the bounce in corn values, and reduced quality may increase
feeding on that front. On the report, wheat acres are expected to be 45.65
million acres on a range of 44.5 million to 46.10 million, and stocks at 1.10
billion with a range of 1.077 billion vs. 1.16 billion bushels. On the July
Kansas City chart, support is the 10-day and 20-day at $4.63-4.64, at which we
are tested this morning with more support at the lower Bollinger band at 4.43,
and resistance the recent high at $4.73.
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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