DTN Midday Grain Comments 05/23 11:37
All Grains Lower at Midday
Trade is lower across the board at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are higher with the Dow futures up 30. The
interest rate products are lower. The dollar index is narrowly mixed. Energies
are mixed with crude up 0.25. Livestock trade is mixed. Precious metals are
mixed with gold $1.60 lower.
Corn trade is 3 cents lower at midday with trade continuing to grind around
the recent trading range. The market focus is on near term weather forecasts.
Soggy conditions are expected to continue this week in much of the belt, with
some improvement in extended forecasts. Ethanol margins are stable, but have
narrowed in recent days. The weekly crop progress showed planting progress at
84%, same as last year, and 1% behind average with emergence at 54% versus 58%
last year and 55% on average. Illinois improved 9% on good to excellent ratings
to 51%, and Iowa started at 75% good to excellent. The trade took the news
Monday afternoon as uneventful. On the July chart support is at the 20-day at
$3.70. Resistance is at the May $3.79 high.
Soybean trade is 3 to 5 cents lower at midday with trade continuing to chop
in the lower end of the recent range with some light two sided trade early on.
Meal is $1 to $2 lower and oil is 20 to 30 points lower. Trade will need to
digest the increased movement from South America on the slide in the Brazilian
currency, although it has stabilized somewhat to start the week. U.S. basis
should stay steady for the moment with slower movement and the USDA announced
126,000 metric tons of old crop soybeans sold to unknown. The weekly crop
progress has planting progress at 53%, same as last year, and 1% ahead of
average, with emergence at 19% emerged, 1% behind last year, and 2% behind
average. July beans have support at the longer term low of $9.40, with the
weekly low of $9.42 just above that, with resistance at 10-day moving average
Wheat trade is 1 to 5 cents lower at midday with trade seeing some selling
after the light improvement noted on the weekly numbers. Early harvest has been
lower yields and protein than expected so far but we are still a ways from
significant harvest pressure, with the protein spreads bouncing around this
morning. The dollar is back to the lowest levels since the election with trade
just below 97 on the index. Crop progress showed winter wheat conditions at 52%
good to excellent, and 17% poor to very poor, 1% better, with heading at 72%
versus 74% last year and 67% on average. Spring wheat planting was at 90%
planted, 4% behind last year but 6% above average with emergence at 62%, 13%
behind last year, and 3% ahead of average. Soft wheat conditions slipped more
which has spread trade shifting that direction early in the week. On the July
Kansas City contract support is the 10-day at $4.33, which we are just below at
midday with 50-day at 4.39 resistance, which we failed to hold above Monday.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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