DTN Midday Grain Comments 01/23 10:58
Grain Trade Mixed at Midday
The U.S. stock market is weaker with the Dow down 180. The dollar index is
25 points higher. Interest rate products are weaker. Energies are weaker with
crude down $1.30. Livestock trade is mixed with hogs leading. Precious metals
are mixed with gold $8.60 higher.
By David Fiala
DTN Contributing Analyst
Corn trade is 3 to 4 cents higher at midday with trade scoring a new high
for the move before fading slightly at midday. Ethanol margins continue to
decline with flat futures action post report with production down 46,000
barrels per day, with stocks up 1.025 million barrels, putting stocks ahead
year on year. U.S. weather will likely limit short-term movement in most areas
with warmer weather expected to be on the way into the end of the month. Basis
should remain sideways to slightly firmer. The export wire showed some lift
with 114,224 metric tons sold to Guatemala, and 141,000 metric tons sold to
unknown. On the March contract support is the 20-day at $3.86, with resistance
the new high at $3.93 3/4.
Soybean trade is 3 to 5 cents lower with trade continuing to bore into
resistance levels with export support lacking and South American progress
remaining robust. Meal is flat to $1.00 higher and oil was 35 to 45 points
lower. The Brazilian ral remains very cheap as well hurting U.S. export
competitiveness, although it has gained slightly this morning. South American
weather remains within the recent pattern for soybeans as well with early
harvest underway. Basis has remained steady at processors with the strong crush
margins. The March chart support is at $9.00 with psychological support there,
and resistance is the lower Bollinger band at $9.11.
Wheat trade is narrowly mixed with trade working to hold the upper end of
the range after the reversal yesterday and overbought conditions along with
little fresh news. Cold threats remain limited for the Plains with most of the
moisture staying to the east, with western snow cover remaining limited, and
warmer conditions expected to return to most short term. Kansas City is at an
86 cent discount to Chicago, while Minneapolis is back to a 20 cent discount.
The March Kansas City chart support is the 20-day moving average at $4.85, with
resistance the upper Bollinger Band at 5.05.
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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