DTN Midday Grain Comments 02/18 11:28
Wheat, Corn Higher at Midday
Corn is 3 to 4 cents higher at midday, soybeans are narrowly mixed, and
wheat is 7 to 15 cents higher.
By David Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow down 270. The dollar index is
20 higher. Interest rate products are weaker. Energies are mixed with crude
down $0.50. Livestock trade is mostly lower. Precious metals are firmer with
gold up $19.00.
Corn trade is 3 to 4 cents higher at midday to open the week, with trade
extending the streak of hitting $3.80 during the session to 13 in a row with
the early buying. Ethanol margins are little changed with ethanol futures flat
to start the week. Corn basis remains steady to slightly softer, with little
change in recent days but more open weather should help movement along with
March basis contracts coming due. Weekly export inspections showed improvement
at 795,228 metric tons. On the March contract support is the lower Bollinger
Band and the fresh lows at $3.75, then the $3.71 four-month low, with
resistance at the $3.94 recent 2 1/2 month high with the 20-day just above the
market at $3.83 which we remain just below.
Soybean trade is narrowly mixed with trade finding light buying with China
relaxing more tariffs as part of the trade process, along with the expectations
of new bookings for fall but they have yet to appear. Meal is flat to $1.00
higher, and oil is narrowly mixed. South America continues to make good
progress with weather and harvest moving forward with little change on the
horizon with some rains delays in Brazil last week. The Brazilian ral remains
very cheap as well hurting U.S. export competitiveness near term with the
end-of-week gains evaporating again. New-crop soybeans will need to gain vs.
corn to provide an acreage incentive ahead of planting in the U.S. as well with
some gains last week. Weekly export inspections were in line with recent weeks
at 992,294 metric tons. The March soybean chart support is the 20-day moving
average at $8.91, with resistance $9.00 nearby.
Wheat trade is 7 to 16 cents higher at midday with Chicago gapping higher
overnight to lead action with further reductions to the Australian crop
headlining the news to open the week. Weather threats for the Plains remain
limited near term domestically with limited short term moisture across most of
the Plains. Kansas City is at a 83-cent discount to Chicago, regaining a dime
the last few days while Minneapolis is back to an 19 cent discount as well.
World values remain mostly elevated with Chicago wheat expensive, and Kansas
City wheat on the low end with Black Sea and European origin still the better
deals for Middle East tenders. Weekly export inspections were better at 501,990
metric tons. The March Kansas City chart support the lower Bollinger band at
$4.55, with resistance the 20-day at $4.74.
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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