DTN Midday Grain Comments 06/21 11:38
Grain Trending Lower at Middayi
Trade is softer across the board at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are firmer with the Dow 100 higher. The dollar
index is 10 weaker. Interest rate products are firmer. Energies are firmer with
crude 0.40 higher. Livestock trade is lower with hogs limit down. Precious
metals are mixed with gold 2.30 higher.
Corn trade is 1 to 3 cents lower at midday with mixed action since
overnight; traders note little fresh news. The forecast looks to trend towards
warmer and drier into July with near term 1-4 inch rains lingering in many
areas. Ethanol margins remain tight with blender margins getting a boost from
the surge in crude values while ethanol futures have edged lower this AM. The
trade continues to debate acreage losses and the yield effects of the late wet
planting conditions that will keep uncertainty in this market for the growing
season. Corn basis remains on a firmer trend, especially for the Eastern Belt.
On the July nearby chart support is the 10-day at $4.41 1/2, with the 20-day at
$4.31 below there. Resistance is the upper Bollinger Band at $4.60.
Soybean trade is 7 to 10 cents lower with trade chopping lower as we start
to move into more of a short-term range. Meal is $3.00 to $4.00 lower, and oil
is flat to 10 points lower. Crush margins remain solidly positive overall with
oil leading again today. World export demand remains slow, and the South
American currencies cheap but firming vs. the dollar after the Fed statement.
Field work will likely be slowed again in many areas with more insurance days
passing for soybeans before potentially more open weather at the end of the
month with trade trying to hold on to acres with November near the contract
highs with changes to haying regulations on cover crops helping to finish
planting. The July chart support is the 200-day at $9.07, with next support the
100-day at $8.97, then the recent high at $9.21 as resistance.
Wheat trade is flat to 3 cents lower in choppy overnight trade ahead of
another harvest weekend. The Kansas City/Chicago spread is in the process of
scoring new highs again. The heavy rains are slated more for the north and east
parts of the winter wheat belt while harvest should build elsewhere, with heat
expected to help push things along to the west with harvest spreading into
south-central Kansas with north of I-70 not expected until the end of next
week. The dollar is testing 96 on the index with the sharp pullback after the
Fed Statement. Black Sea-area weather remains mixed with world values soft.
Hard red wheat is working into feed rations in some areas with the bounce in
corn values, and reduced quality may increase feeding on that front. On the
July Kansas City chart, support is the 100-day at $4.51 with resistance again
the 20-day at 4.59, which we are right at overnight.
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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