DTN Midday Grain Comments 01/23 11:00
Soy Complex, Wheat Mixed at Midday
Corn trade is higher at midday following good weekly sales numbers, wheat
and beans are mixed.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed at midday with the Dow futures down
30 points. The interest rate products are lower. The dollar index is 50 higher.
Energies are flat to higher with crude narrowly mixed. Livestock trade is
sharply lower. Precious metals are lower with gold down $10.
Corn trade is 2 to 4 cents higher at midday with support coming from a much
stronger than expected export sales number. The weekly export sales were 2.19
million metric tons with significant buying interest showing up on the weakness
last week. Ethanol production is expected to ease lower going forward with
stocks building as blender margins discourage near term use. Nearby ethanol
futures have been sideways in recent days, but another round lower is possible.
The corn market is illustrating a sideways tone with resistance in the $3.88-90
area where the 10-day and 50-day moving averages sit, and support at the
100-day moving average around $3.76. The market may want to see several weeks
of high weekly sales to change market attitudes toward exports considering the
price broke last week and now we have the dollar surging higher this week.
Soybean trade is 1 to 4 cents lower at midday after trade made fresh lows
this morning after disappointing export trade. Meal is $2.00 to $3.00 higher
and oil is 20 to 30 points higher. South American weather forecasts remain
mostly good with a few limited areas of concern remaining as we get deeper into
the main growing season. Soymeal continues to maintain an inverse with good
demand for the front month. The weekly export sales were disappointing at
14,100 metric tons of old crop sales, 101,200 of new crops sales, but product
sales were strong with 284,500 of meal, and 17,100 of oil. The March soybean
chart resistance is the 10-day moving average at $9.98, with limited nearby
March support other than the $9.67 low printed this morning, and then $9.20
which is our contract low printed in early October.
Wheat trade is narrowly mixed across the three contracts this morning with
row crop trade drifting sideways, and the dollar sharply higher yet again,
although it has backed away from the highs. Trade is fairly oversold but the
consistent appreciation of the dollar is the bigger driver for right now.
Warmer weather across the Southern Plains will limit wheat stress but could
encourage some wheat to leave dormancy early. Export sales were a bit improved
at 458,400 metric tons. The March Kansas City 10-day and lowest major moving
average is at $5.77 which is nearby resistance with the $5.61 low printed this
nearby support; then $5.54, the October and contract low.
David Fiala is a DTN contributing analyst and the president of FuturesOne
and a registered Trading Adviser.
David Fiala can be reached at firstname.lastname@example.org
Follow David Fiala on Twitter @davidfiala
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