DTN Midday Grain Comments 08/17 11:49
Grains Mixed at Midday
Trade is mixed at midday; very slow trade.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower with the Dow futures down 140
points. The interest rate products are higher. The dollar index is 12 higher.
Energies are mostly higher with crude up 0.20. Livestock trade is lower.
Precious metals are mixed with gold up $7.10.
Corn trade is 2 to 3 cents lower at midday with trade testing the lows again
after two sided trade overnight. December hit a new 2017 low at $3.63 1/4
yesterday and came within a quarter cent this morning. Long liquidation this
afternoon into Friday could help accelerate downside if the new low gives way.
Ethanol futures have edged slightly lower this morning. The weekly export sales
were sub-par with 62,400 metric tons of old crop sales, and 671,800 of new crop
sales. Chinese corn values have hit a 14 month high as well and gulf origin US
corn is cheaper than South American corn so export optimism is improving with
the lower prices. On the December chart support is at $3.63 1/4 which is the
new low for the move and the lower Bollinger Band. Resistance is at the 10-day
moving average at $3.76.
Soybean trade is 1 to 2 cents higher at midday with light buying after rains
disappointed in Iowa again. Meal is flat to $1 higher with bean oil 15 points
higher. Trade will assess crop progress in the drier areas, which more
potential short covering if the trade decides it was more disappointing, along
with whether or more new demand surfaces with more frame contracts signed. The
weekly export sales were good at 453,200 metric tons of old crop, and 899,200
new crop, 74,200 metric tons of old crop meal, 68,800 new, 23,900 new and 3,000
old of oil. On the November chart support is at the fresh low for the move at
$9.21, then the one-year low printed in June at $9.07. The 10-day moving
average is chart resistance at $9.47 3/4.
Wheat trade is mixed with the winter wheat contracts down 4 to 7 cents and
Minneapolis up 3 to 6 cents. Both Kansas City and Chicago have slipped to new
contract lows with these markets now oversold. The trend of growing global
supplies has not been broken; lower prices economically discourage production
and encourage greater usage. This is what the market is doing. The poor spring
wheat production year is expected to keep Minneapolis firm versus Chicago or
Kansas City and just stay volatile. The dollar is working against U.S. business
at the moment, with Russia still securing the bulk of the upfront business.
Exports did improve on the week at 633,800 with the weak dollar last week. On
the December Kansas City contract support is the $4.41 3/4 fresh low with
resistance at the 10-day at $4.72.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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