DTN Midday Grain Comments 07/20 11:21
All Grains Higher at Midday
Warm weather has corn and beans near the daily highs at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower with the Dow futures down 50 points.
The interest rate products are higher. The dollar index is 15 higher. Energies
are mixed with crude down 0.10. Livestock trade is mostly lower. Precious
metals are mixed with gold up $4.30.
Corn trade is 7 cents higher at midday and at new highs for the week. The
near term heat is keeping sellers away. Some rains have visited the dry areas
of the western belt with storm damage coming along with storms. Corn is in the
middle of pollination this week so some heat stress is the concern. Ethanol
production margins are going backwards this week with the strength in corn but
margins are okay. The weekly export sales were at 466,500 metric tons of old
crop, and 212,100 metric tons of new crop. Midday forecasts should provide
direction into the afternoon with short covering late in the day a possibility.
On the December chart support is the $3.91 20- and 50-day moving averages, then
resistance is the $3.98 10-day which we have eased above overnight with the
weekly high at $4.04 1/2 above that.
Soybean trade is 12 to 15 cents higher at midday with trade continuing to
find light buying as we consolidate back above $10.00. Meal is $4 to $5 higher
and oil is 25 to 35 higher. Futures are adding weather premium this week due to
the heat and concerns over the important soybean weather over the next six
weeks. China is expected to remain active for forward pricing in the near term
with weekly export sales showing up strong today at 409,600 metric tons old
crop, 1.52 million new, 41,400 metric tons of old crop meal, 75,200 of new, and
25,400 oil. On the November chart support is at the 200-day moving average at
$9.84 with resistance at the 10-day at $10.15 which we are solidly above at
midday, with last week's highs at $10.47 as the higher resistance levels.
Wheat trade is 6 lower to 2 higher at midday with the KC wheat taking the
lead as Minneapolis wheat fades further off the early week rally. Spread trade
remains soft for the winter wheat, and spring wheat continues to slowly add
carry. Most world export business remains focused on the Black Sea area as
harvest begins to progress there, with the dollar making new lows again today.
Australia continues to see dryness, raising concerns for production in the
coming months but near term supplies remain ample. The weekly export sales were
improved at 669,500 metric tons. On the December Kansas City contract support
is the 50-day at $5.08 with the 20-day at $5.42 resistance.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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