DTN Midday Grain Comments 11/26 10:37
Grain Futures Spending Black Friday in the Red
Corn trade is 9 to 10 cents lower, beans are 23 to 24 cents lower and wheat
is 8 to 20 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is sharply lower with the Dow down 900 points. The
U.S. Dollar Index is 0.84 lower. Interest rate products are firmer. Energies
are sharply lower with crude down $9.20. Livestock trade is mixed. Precious
metals are mixed with gold up $13.50.
Corn trade is 9 to 10 cents lower with spillover from risk-off trade Friday
ahead of option expiration for December, along with the pending first notice
day and the reversal scored on Wednesday. USDA announced 100,000 metric tons
sold to Mexico on the daily wire with export sales strong at 1.429 million
metric tons. Ethanol margins take a hit if the sharp energies sell-off
persists, but tight stocks and holiday demand will limit downside for now.
Basis should remain steady to firmer short term with harvest wrapping up and
more of a focus shifting to fall fieldwork as producers try for a good fall NH3
run. On the December contract, we have resistance at the recent high of $5.89,
with the upper Bollinger Band at $5.87, and the 20-day moving average as
support at $5.69, which we are testing at midday.
Soybean trade is 23 to 24 cents lower at midday with broad-based selling at
midday with meal and oil weaker and spillover from the outside markets. Meal
was $4.00 to $5.00 lower and oil was 1.90 cents to 2.00 cents lower. South
America looks to continue short-term progress with issues remaining limited for
now with good recent rains for many as planting wraps up. Crush margins remain
solid with the pullback. Weekly export sales were decent at 1.564 million
metric tons of beans, 136,900 of meal and 42,000 of oil. On the January soybean
chart, support is the 20-day at $12.44 which we are testing at midday with the
$12.84 fresh high as the next round up from there, with the upper Bollinger
Band above that at $12.95.
Wheat trade was 8 to 20 cents lower at midday with Minneapolis wheat leading
as overall wheat trade holds up better than the other grains amid the
widespread liquidation Friday morning, as Australian harvest concerns and
Russian concerns keep trade near the highs. The dollar is fading back below 97
points on the index with the commodity selling. Weather in the Plains looks
little changed short term with longer-term dry concerns for the Southern
Plains. Spring wheat is firmer versus Chicago, moving the premium to 2.07
cents, with KC at a 40-cent premium in firmer action scoring new highs. Weekly
export sales were good at 567,600 metric tons. KC December chart support is at
the 20-day at $8.18 with resistance at the upper Bollinger Band at $8.80 with
the fresh high at $8.87.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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