DTN Midday Grain Comments 12/04 10:55
Grains Mixed at Midday
Soybeans lead mixed trade at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 200. The dollar index is 17
lower. Interest rate products are firmer. Energies are mostly higher with crude
$2.15 higher. Livestock trade is mostly lower. Precious metals are mixed with
gold down $6.60.
Corn trade is 3 to 4 cents lower with trade failing at resistance at $3.82
yet again, with spread unwinding vs. soybeans adding pressure at midday. The
weekly ethanol report showed production up 1,000 barrels per day, with stocks
362,000 barrels higher and stocks are slightly lower. Basis has held up well
with the slow pace of harvest so far with another storm stopping remaining
harvest for now, but warmer weather will return for many into midmonth. South
America should see areas of improvement as planting progresses, with a drier
week in Argentina expected through the weekend. On the March contract support
is the lower Bollinger Band at $3.74, with resistance the 20-day at $3.81 which
we failed again at.
Soybeans are 6 to 8 cents higher with the pattern of overnight strength
still intact, while we wait to see if trade can sustain during the day session
after finally holding on to a positive session yesterday with good progress at
midday. Meal is 2.00 to $3.00 higher, and oil is 10 to 20 points higher. The
real remains cheap vs. the dollar although slightly firmer overnight with the
export wire seeing 20,000 metric tons of oil to Morocco. Bean basis has moved
to a more sideways trend short term with pockets of firmness showing up on the
break. The January chart support is the lower Bollinger Band at $8.62, which we
are finally pulling away from, with resistance well above the market at $9.03
where the 20-day moving average, along with exceptionally oversold conditions
starting to ease.
Wheat trade is 1 cent lower to 3 cents higher with the Kansas City trade
leading over at midday after the higher protein wheats gained solidly vs. the
Chicago yesterday and today. The Chicago/Kansas City March spread is back to 86
cents. Chicago also holding a 9 cent premium to Minneapolis which has narrowed
sharply this week. The dollar remains rangebound but is starting to shift lower
again. Export business has been quiet so far this week. The forecast dries the
Plains back out short term, with the Black Sea seeing better short-term action,
while Australia's crop is estimated to be off about 20% on the year. The March
Kansas City chart support is the 20-day at $4.35, and resistance the upper
Bollinger Band at $4.47.
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
Copyright 2019 DTN/The Progressive Farmer. All rights reserved.
Your local weather forecast from DTN can be sent to your email every morning free through DTN Snapshot