DTN Midday Grain Comments 07/25 11:10
All Grains Lower at Midday
Early overnight gains give way to broad selling at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are higher with the Dow futures up 110 points.
The interest rate products are lower. The dollar index is narrowly mixed.
Energies are firmer with crude up 1.30. Livestock trade is mixed. Precious
metals are mixed with gold down $4.00.
Corn trade is 5 to 7 cents lower at midday with cooler forecasts and near
term rain offsetting the decline in weekly crop conditions. Corn pollination
will continue with cooler temperatures after the next couple of days but rain
coverage remains less than ideal for the much western belt with signs of
improved coverage for Nebraska and Iowa Tuesday and Wednesday. There are also
spots of excessive moisture in areas of the east. The weekly crop progress
report showed corn ratings down 2 percentage points to 62% good to excellent,
and 12% poor to very poor. Progress was listed at 67% silking, 9% behind last
year, and 2 percentage points behind average, and 8% in the dough, 4 percentage
points behind last year, and 5 percentage points behind average. Ethanol
margins are improved this morning with the cheaper corn and firmer energy
complex. On the December chart support is at the July low of $3.81 3/4 with
resistance at the 100-day at $3.90 which we closed just above yesterday then
the 20-day at $3.94.
Soybean trade is 3 to 7 cents lower at midday, well off the overnight highs
after the initial snap higher. Meal is $3.50 to $4.50 lower and oil 15 to 25
higher. Cooler temperatures with some moisture was viewed as less threatening
for the coming weeks. We still have six important weeks of weather ahead for
beans. The western belt will likely see the most stress going into August with
rains limited after tomorrow. The weekly crop progress report had conditions
down 4 percentage points to 57% good to excellent, and 14% poor to very poor
with 69% blooming, 5 percentage points behind last year, and 2 percentage
points ahead of average, with 29% setting pods, 4 percentage points behind last
year, and 2 percentage points ahead of average. On the November chart support
is at the 20-day at 9.94 with resistance at the 10-day at 10.13.
Wheat trade is 8 to 25 cents lower at midday with Minneapolis trade leading
the way lower again as the ongoing correction continues. The spread trade
remains active with Minneapolis still $2.50 over Chicago. The September spread
was trading around $1 over in early May, then traded to nearly $3 over on July
5. Most world export business remains focused on the Black Sea area as harvest
begins to progress there, with the dollar around the yearly lows there is hope
for export U.S. improvement but world supplies remain ample. The Spring wheat
tour is in the better areas of the eastern growing area today. The weekly crop
progress had winter wheat 84% harvested 4 percentage points ahead of average,
spring wheat down 1 percentage point at 33% good to excellent, and 41% poor to
very poor with 96% headed, 2 percentage points ahead of average. On the
December Kansas City contract support is the 100-day at $4.94. Resistance is at
the 50-day at $5.06 then the 10-day at $5.31.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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