DTN Midday Grain Comments 08/14 11:02
Grains Mostly Higher at Midday
Soybeans are the midday leader with corn and wheat mostly firmer.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed with the Dow futures up 110. The
interest rate products are firmer. The dollar index is 16 points higher.
Energies are firmer with crude up 0.20. Livestock trade is mostly higher.
Precious metals are mixed with gold 5.40 higher.
Corn trade is 2 to 3 cents higher at midday with trade trying to rebuild
some momentum at the lower end of the recent range with support from the
soybeans. The weather forecast looks fairly mild in the near term with most
rains south of I-80. Ethanol margins continue to not be great. Ethanol is down
again to start the week and is now nearly 70 cents a gallon cheaper than
unleaded futures with summer driving season coming to an end soon. This should
encourage more usage and blending in the near term with futures edging higher
this morning. Corn basis even with this board selloff is fading ahead of
harvest and late-season corn movement with harvest starting in the drier areas.
The weekly Crop Progress report had conditions 1 percentage point lower at 70%
good to excellent, and 10% poor to very poor. Seventy-three percent of the crop
was in the dough stage, 17 percentage points above average, and 26% was dented,
13 points ahead of average. On the September chart, futures have support at the
lower Bollinger Band at $3.42, and resistance the 20- and 50-day at $3.62.
Soybean trade is 7 to 10 cents higher at midday with support from Argentina
re-imposing export taxes on soy products amid ongoing governmental financial
issues. Meal is $7.50 to $8.50 higher, and oil is 15 to 25 points lower. The
weather forecast has drifted wetter for all but the northwest part of the belt.
Bean basis has started to slide ahead of harvest with the slow start to export
bookings offsetting strong crush margins. Early planting in South America will
begin next month with much of Brazil on the dry side at the moment. Weekly Crop
Progress showed conditions 1 percentage point lower at 66% good to excellent
and 10% poor to very poor. Soybeans were estimated at 96% blooming, 4
percentage points above average, and 84% were setting pods, 12 points above
average. On the September chart, trade has support at the lower Bollinger Band
at $8.38 and resistance the 20-day at $8.74.
Wheat trade is flat to 2 cents higher on the winter wheats, with spring
wheat 3 to 5 cents lower with harvest pressure, with trade pulling back from
dime higher action overnight on continued production concerns. Spring wheat
progress will pick up with the warmer weather returning this week with harvest
expanding. Yields are mixed so far. Trade continues to worry about taxes and
restrictions off of the Black Sea as harvest wraps up, but the cheaper currency
will help to offset in the near term with the Black Sea looking to be able to
maintain the pace near term. HRW basis remains sideways to lower as the U.S.
struggles to compete on the export market even with the end of European harvest
amid their difficulties. Australia remains on the dry side with the crop pace
ahead of normal as well. Weekly Crop Progress had spring wheat 1 percentage
point better at 75% good to excellent and 5% poor to very poor. Spring wheat
was estimated 35% harvested vs. 27% on average, and winter wheat 94% harvested
vs. 96% on average. Export inspections showed some improvement at 462,854
metric tons. On the September KC, we are have support at the 100-day at $5.33,
and resistance the 20-day at $5.44.
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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