DTN Midday Grain Comments 12/03 10:56
Corn, Beans Higher at Midday
Corn is 1 to 2 cents higher, soybeans are 11 to 13 cents higher, and wheat
is flat to 7 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 175. The dollar index is 50
points lower. Interest rate products are firmer. Energies are firmer with crude
up $0.30. Livestock trade is weaker. Precious metals are mixed with gold up
Corn trade is 1 to 2 cents higher at midday with lightly firmer spread
action and support from soybeans spilling over. Outside markets are quiet for
the most part with the dollar making new lows. Ethanol margins continue to
deteriorate with the rebound in corn, with production falling slightly by
16,000 barrels per day, while stocks continue to grow as demand declines rising
by 374,000 barrels. Basis remains generally strong. Weekly export sales
remained solid at 1.37 million metric tons. On the March contract support is
the lower Bollinger Band at $4.10 with the 20-day at $4.25 becoming resistance
which we are just above overnight.
Soybean trade is 11 to 13 cents higher at midday with trade rebounding off
the lows scored yesterday with flat spread action as the South American weather
forecast is little changed short term, and trade looks for fresh export
business on the break as we close in on a month since the last announced sale.
Meal is $2.50 to $3.50 higher and oil is 60 to 70 points higher. South America
has rains moving into much of central and southern Brazil and Argentina short
term, with dry pockets and high temps still a worry. Basis remains strong as we
continue to work to max out our logistics capacity to ship the needed export
bushels with freight issues remaining in play. Weekly export sales were softer
at 406,900 metric tons, 163,800 of meal, and 2,500 of oil. The January chart
has resistance at the fresh high at the fresh high at 12.00 scored last week,
with the upper Bollinger band at $12.16, with support the 20-day at $11.58
which we are back above at midday with the lower Bollinger Band at 10.92 below
Wheat trade is flat to 7 cents lower with choppy trade continuing today with
little fresh news. The dollar remains at the lower end of the range but hasn't
shifted export competitiveness yet. World export tenders continue to go to
Black Sea origin for the most part, with little change in overall conditions
there going into dormancy. The western Plains look to mostly remain dry short
term with better moisture to the east. Kansas City is at 35-cent discount to
Chicago on the March with active trade continuing, with Minneapolis at -28.
Weekly export sales were off from the surge last week at 446,400 metric tons.
Kansas City March chart resistance is the 20-day at $5.57 which we failed to
hold late last week, and support is the lower Bollinger Band at $5.42 which we
tested before bouncing yesterday.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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