DTN Midday Grain Comments 09/13 11:08
Soybeans Higher in Midday Trade
Corn is 1 cent to 2 cents higher; soybeans are 4 cents to 6 cents higher,
and wheat is 1 cents to 4 cents higher. Outside markets are lightly mixed.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed to flat with the Dow 50 higher. The
U.S. dollar index is 9 points lower. Interest rate products are firmer.
Energies are lower with crude down .25 cent. Livestock trade is mixed with hogs
limit higher. Precious metals are mixed with gold $6.00 lower.
Corn is 2 cents to 3 cents higher at midday with follow-through buying from
the strong finish Thursday and more optimism on the trade front. Weather
remains a short-term nonissue with higher temperatures and wetter weather to
the north. Corn basis should start to see more pressure in the south with
harvest soon. The expected ethanol policy announcements have yet to come this
week, with margins still under pressure and flat futures Friday morning. The
WASDE report pegged yield at 168.2 bushels per acre (bpa), down 1.3 bpa from
August, but above expectations, with old crop carryout at 2.446 billion bushels
(bb), up 84 million bushels (mb) from last month, and new crop at 2.19 bb up, 9
mb from last month, with acres unchanged on softer demand. On the December
contract support is at the 20-day at $3.66 with the upper Bollinger band above
trade at $3.79.
Soybean trade is 4 cents to 6 cents higher with trade optimism helping us
consolidate action right around $9.00 on the November contract. Meal is $2.50
to $3.50 higher, and oil is flat to 10 cents higher. Crush margins remain
positive with meal back to $300 a ton. The bullish export story needs China
coming forward as U.S. export competitiveness improves on the world market with
active bookings off the Pacific Northwest the last few days with 204,000 metric
tons (mt) on the daily wire Friday. Bean basis remains flat in the interior.
South American currencies remain weak as planting season draws closer. On the
report, yield was 48.2 bpa, down .3 bpa with larger but fewer pods, with
old-crop carryout at 1.054 bb, down 65 mb from last month, and new crop at 640
mb, down 105 mb from last month, with acres unchanged. On the November chart we
have support at the 50-day at $8.84 and the upper Bollinger band at $8.91, with
resistance being the 200-day at $9.15.
Wheat trade is 1 cent to 4 cents higher with trade following the lead of the
row crops with the winter wheat leading with little fresh news for the wheat.
The Kansas City/Chicago spread is at 82 cents, back at the high end of the
range. The corn/HRW spread is tight hanging around the 37-cent area. KC wheat
is competitive on the world market, but we need to see the business and more
buyers to move the board out away from our lows. Spring wheat harvest is in the
home stretch. The report came in unchanged at 1.98 bb of production, and stocks
at 1.014 bb. The December KC chart support is at the 20-day at $4.00, with
resistance at the upper Bollinger Band at $4.13.
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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