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DTN Midday Grain Comments     07/17 11:07

   Grains Trending Higher at Midday

   Row crops have some light buying at midday, with wheat drifting sideways.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are weaker with the Dow 60 lower. The dollar 
index is 16 lower. Interest rate products are weaker. Energies are mixed with 
crude 0.35 lower. Livestock trade is mixed with hogs leading. Precious metals 
are mixed with gold 12.80 higher.


   Corn trade is 2 to 3 cents higher at midday with trade unable to sustain 
either end of the range so far. The forecast will continue to draw attention as 
more of the crop pollinates with mostly dry conditions expected to continue 
with the second week cooler for a few days with the forecasts still moving 
around a bit. Ethanol margins will remain poor with production up 19,000 
barrels per day, and stocks up 356,000 barrels keeping supplies burdensome. 
Harvest should be on the downhill slide for Brazil with more signs of imports 
into the SE U.S., with mixed conditions elsewhere. Basis remains very strong 
across a variety of areas, especially the East with intramonth spreads steady 
today. There has been some talk of 7-8 million acres prevent plant out of the 
RMA today. On the September nearby chart support is at the 50-day at $4.23 with 
further resistance the 10-day at $4.39, which we tested but did not hold.


   Soybean trade is flat to 2 cents higher at midday with trade seeing light 
buying return after the early week selling. Meal is flat to $1.00 higher with 
oil 10 to 20 points higher. Crush margins remain positive with meal still 
holding around $310 a ton. World export demand remains slow, with the real 
still cheap vs. the dollar. Weather will come into focus more as we head 
towards August and podfill season with talk of 2-3 million acres of prevent 
plant from the RMA. The September chart support is the 50-day at 8.80, with the 
next level up the 100-day at 8.97 which we are just below at midday, with the 
20-day the next round at $9.04.


   Wheat trade is narrowly mixed with early strength fading again as harvest 
continues. The Kansas City/Chicago spread is 2 wider this a.m. The corn/HRW 
spread has widened again this morning as well. The warmer weather should allow 
harvest to progress to move to the home stretch, while Europe makes progress, 
and the Black Sea continues to see mixed yields with Russian estimates moving 
lower again this week. The dollar is just below 97 on the index with weaker 
action today. The September Kansas City chart support is the recent low at 
$4.39 with the first resistance the 10-day at 4.48, which we are just above 
overnight with the 100-day at 4.51 the next round up.


   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered adviser
He can be reached at 
Follow him on Twitter @davidfiala


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