DTN Midday Grain Comments 09/03 11:05
All Grains Lower at Midday
Wheat and corn lead trade lower at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock markets are higher with the Dow futures up 145 points. The
interest rate products are lower. The dollar index is 65 points higher.
Energies are higher with crude up $1.20. Livestock trade is mixed with cattle
higher and hogs lower. Precious metals are mixed with gold down $10.
Corn trade is 5 to 7 cents lower at midday with trade continuing to grind
along at the lower end of the range approaching the lows from the August
report. Warmer weather is expected to continue into the weekend, which should
move maturity along with harvest expected to become more widespread in the next
couple of weeks. Ethanol margins have improved with ethanol futures gaining
this morning on broad based support in the energy complex. The USDA monthly
report is due out next Friday which will be the next major news trade this week
should be active with some direction from the outside markets. Weekly export
sales were disappointing at 112,700 metric tons of old crop, and 328,300 of new
crop. On the December chart support is at the low from this morning at $3.61
and then the contract low at $3.57. Resistance is at the $3.78 20-day moving
average then the $3.86 high printed last week.
Soybean trade is 5 to 7 cents lower at midday with trade giving back the
early gains seen after strong export sales. Meal is $4 to $5 lower and oil is
15 to 25 points higher. Beans have carved out a range in the $8.60 to $8.90
area with trade hanging in the middle to lower end of the range. The weather is
still important to determine how the crop will finish out but few worries are
around with dry pockets as we head towards the finish with the warmer weather
starting push maturity. The USDA announced strong sales on the daily wire with
110,000 metric tons to China, and 773,400 to unknown. The weekly export sales
were very strong at 1.53 million metric tons of new crop sales, 212,000 metric
tons of net soymeal sales, and 6,100 net soyoil sales. On the November soybean
chart support is at the contract low of $8.55 is support with resistance at
$8.88 the previous low then the 20-day at $9.08.
Wheat trade is 5 to 10 cents lower with the stronger dollar and poor export
sales help trade make new lows this morning. Weak fundamentals and chart
pressure will continue to limit upside, some profit taking vs. shorts is
probably needed in the near term, but further shorts continue to be added for
now with the market heavily oversold and no buyers are stepping up to buck the
trend. Spring wheat harvest will be wrapping up soon which should take some of
the pressure off the Minneapolis contract. The weekly export sales were
disappointing at 277,500 metric tons. Chart resistance for the December Kansas
City contract is at the $4.89 10-day moving average. Support is at the $4.67
fresh contract low reached this morning.
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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