DTN Midday Grain Comments 05/18 10:46
Corn Headed Higher Midday Tuesday
Corn is 9 to 11 cents higher, soybeans are 2 to 3 cents lower with new crop
4 to 5 cents higher and wheat 3 to 6 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is mixed with the Dow down 60 points. The U.S. Dollar
Index is 0.30 lower. Interest rate products are mixed. Energies are mixed with
crude down $0.50. Livestock trade is mixed. Precious metals are flat with $1.50
Corn trade is 9 to 11 cents higher at midday with slightly stronger spread
action as the July contract continues to lead with little surprise on the
weekly crop progress report and good demand. Trade looks for more new-crop
sales with another 1.36 million metric tons sold to China. Ethanol margins
should remain solid with ethanol values offsetting the corn rebound. Weather
looks to warm up with better moisture for many areas. Brazil continues to
struggle with dryness during pollination and crop estimates still falling but
time running out to change the crop size much in either direction, albeit with
some relief rains out there. Corn basis wobbled a little bit with the river
issues. Weekly crop progress put corn planting at 80% complete versus 68% on
average, with emergence at 41% versus 35% on average. On the July contract,
chart resistance is the 20-day at $6.69, with support the fresh low at $6.33.
Soybeans is 2 to 3 cents lower at midday with weaker spread trade after
testing $16.00 again overnight, while new crop holds on to 4- to 5-cent better
action; meal is $1.00 to $2.00 lower and oil 0.20 cent to 0.30 cent lower.
Planters will continue to roll short term with some areas of rain slowing
action and warmer temps to boost emergence by the end of the week, with
planting well ahead of average at 61% versus 37% on average and emergence at
20% versus 12%. South America should continue to see shipping progress short
term, while domestic crush will carry U.S. basis with oil continuing to lead
action but notable processor weakness in some areas. On the July soybean chart,
support is the 20-day at $15.53, with resistance at the upper Bollinger Band at
Wheat trade is 3 to 6 cents higher at midday with support from the dollar
making new lows and spillover from the row crops. Seasonal weather on the
Plains should boost growth with big rains in parts of Kansas and a better
forecast for the North, with conditions down 1% at 48% good to excellent and
19% poor to very poor, and heading at 53% versus 58% on average. Spring wheat
is 85% planted versus 71% good to excellent, and 47% emerged versus 36% on
average with better rains expected. Other Northern Hemisphere weather will
continue to be watched as well with little fresh news on the front. The dollar
remaining at the lower end of the range should add support as well. KC July on
the chart has remains below the 20-day at $6.90 with the lower Bollinger Band
below that at $6.38.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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|Prices subject to change without notice.
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