DTN Midday Grain Comments 01/25 12:03
Corn, Beans Lower at Midday
Midday trade has row crops softer, while wheat moves higher.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are higher at midday with the Dow futures up
35. The interest rate products are higher. The dollar index is 18 lower.
Energies are mostly lower with crude down $0.20. Livestock trade is mixed with
cattle higher. Precious metals are lower with gold off $9.
Corn trade is 3 to 5 lower after mixed trade early in the morning. Trade
held support at $7.19 so far, keeping trade range bound in the near term.
Resistance will stay at $7.27 for now, where trade failed at today. Outside
markets are mixed. Export news remains quiet for the time being, although US
price competitiveness is improving. Ethanol production data showed a slight
increase week on week, with a small inventory draw. With margins improving, we
may have a low in production in for the near term. Some bear spreading has
returned in the front months, and basis has stabilized for the moment. The
weekly export sales expectations were only 150,000-350,000 tons, and we managed
to come in below that range with a disappointing 139,000-metric-ton number.
This stopped the nearby March from testing back up around $7.30. the overnight
high was 7 cents away from the high of this move.
Soybean trade is 2 to 5 lower midday after testing resistance at $14.45
again this morning, and also testing support at $14.25. Meal is $1 to $2 lower,
while oil is flat. The South American forecast has light showers working
through the dry areas today, and after that the forecast models disagree but
there does appear to be a system a week out. The intensity of that system is up
in the air. The USDA announced 623,000 metric tons of new crop soybean sales,
mostly to China. The weekly export sales estimates are 700,000 to 1.2 million
tons, meal is 150,000-300,000 tons and bean oil 15,000-30,000 tons, and
reported numbers were 383,000 of old crop, 595,000 of new, 218,000 of soymeal,
and 26,300 metric tons oil.
Wheat trade is 2 to 5 higher at midmorning. The row crops remain soft,
keeping some pressure, while forecasts for the heaviest rains shift more into
Missouri than Kansas. Russia is seeing winterkill worries recede in the near
term, but there are concerning areas of dryness. On the chart, March Chicago
has support at $7.66, with resistance at $7.75, and trade has tested both
today. World export offers remain priced above U.S. offers, and additional
export trade should be forthcoming if we stay flat to lower on the board. The
weekly export sales estimates are 300,000-550,000 tons, and were slightly
exceeded with 572,500 metric tons reported.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Trading Adviser
Copyright 2013 DTN/The Progressive Farmer. All rights reserved.
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