DTN Midday Grain Comments 06/18 11:21
Soybeans Lead Grains Higher at Midday
Light firmness is the midday tone at midday for the grain trade.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are higher with the DOW futures up 25. The
interest rate products are flat to lower. The dollar index is 16 lower.
Energies are mixed with crude up $.10. Livestock trade is mostly higher.
Precious metals are lower with gold off $19.
Corn trade is 1 lower on July, 3 higher on September and 6 higher on
December at midday. The weekly condition reports held little surprise and the
market is holding onto the upward momentum started late Monday. Weather ideas
are mixed, but the wetter weather has moved back into the wettest areas in the
near term, which is the main item to note for our midday support. Bull
spreading has remained a feature with July moving to over $1.30 over December
overnight, near its 3-month high, but we are seeing some profit taking at
midday. September moved to over 40 cents over December which was the highest
inverse since August 2012. The December contract has chart support at $5.25
then $5.12. Chart resistance was at the $5.44 20-day moving average, which we
moved above but are back at it at midday. Crop progress pegged corn at 64% good
to excellent, up 1 percentage point from last week, with 92% emerged. Basis
remains strong across most areas of the nation. The trade tried to sell off
Sunday night, but could not. Our action may illustrate we want to stay sideways
until we see the USDA Stocks and Acreage numbers next Friday.
Soybean trade is 5 to 9 higher across the board at midday after planting
progress was a little less than expected. Meal is $3 to $7 higher and bean oil
is flat to 10 higher. The market view is weather has improved but too much of
the crop is slow or will be planted late. This would warrant weather premium at
this juncture. The charts are trying to turn down, but we have seen limited
follow-through up to midday today. November beans slipped below the 200-day and
20-day averages, $12.92 and $12.88 respectively, but have bounced back and hung
around those levels here at midday. Soybean planting progress moved to 85%
complete at the low end of expectations, and initial crop condition was pegged
at 64%, on 84% emerged.
Wheat trade is 1 to 3 higher across the three exchanges at midday in slow
trade. The limited row crop movement has provided little spillover direction.
The July Chicago contract has support at $6.74, the May low, then $6.65, the
April low. Resistance is in the $6.95-$7.00 area. Harvest should continue to
expand this week as hotter temps push the wheat towards maturity, with moisture
moving out of most of the hard wheat areas. Spring wheat will continue to
debate acres for a while until Canadian planting is mostly complete as well.
The weekly report listed winter wheat at 31% good to excellent with 89% headed
and 11% harvested, up 6 percentage points from last week. Spring wheat was
rated 68% good to excellent on 92% planted. The numbers were no surprise.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Trading Adviser
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