DTN Midday Grain Comments 07/28 11:12
Grains Mixed at Midday
Trade is narrowly mixed at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed with the Dow futures down 80 points.
The interest rate products are higher. The dollar index is 49 points lower.
Energies are mixed with crude 0.50 lower. Livestock trade has hogs lower and
cattle and feeders higher. Precious metals are higher with gold $7.80 higher.
Corn trade is 3 to 5 cents lower at midday with trade giving back early
gains as moderate termperatures and a lack of fresh demand news help trade to
set back. On ethanol, producer margins remain just okay and blender margins
remain poor with the weakness in unleaded values dragging the complex lower,
with ethanol futures a penny lower. The weather forecast is cooler in the near
term with rains looking for limited for the next week or so for much of the
belt, overall the crop should continue to develop at a good pace with strong
yields very likely. Export sales were mediocre at 438,800 metric tons of old
crop, and 476,500 of new. The bull argument here is strong demand is present to
take on the big supplies, with US origin at a discount to the rest of the
world. On the December contract support is the contract low at $3.33 1/4.
Resistance is the 10-day moving average at $3.46; then the 20-day at $3.53.
Soybean trade is narrowly mixed at midday with two sided trade as the market
digests a bit more moderate extended forecast, and demand items weren't enough
to trigger buying. Meal is mixed and oil is 10 to 20 points higher. Near term
weather looks non-threatening for the most part, but the extended weather
forecast is still showing hints of a warmer and drier early August weather.
Export business should continue to favor the US with the weekly sales were
mixed at -1,400 metric tons of old crop, 678,200 of new, 79,200 of old crop
meal, 71,500 of new crop meal, and 6,500 of oil. The USDA announced 328,000
metric tons sold to unknown, and 129,000 to China. On the November soybean
chart support is at the $9.63 3-month recent low, then the 200-day moving
average at 9.53, with resistance at the 10-day moving average at $10.07.
Wheat trade is flat to 3 cents higher across the three contracts at midday
with the sharply lower dollar adding support this morning, but weaker row crop
trade has limited upside. The heavy world and domestic supplies continue to
limit upside in wheat, but a reversal in the dollar would be broadly supportive
if it can be exteneded. Production estimates continue to slide out of
Continental Europe while Russian production estimates remains strong. A weekly
export sales were 506,100 metric tons, continuing to run well ahead of last
years pace. On the Kansas City December chart support is at the $4.24 contract
low. Resistance is at the 10-day and 20-day moving averages around $4.41 then
the 50-day at 4.73.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered trading adviser.
David Fiala can be reached at email@example.com
Follow David Fiala on Twitter @davidfiala
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