DTN Midday Grain Comments 05/20 10:52
Soybean Futures Higher at Midday; Corn, Wheat Lower
Corn futures are 4 to 5 cents lower at midday Friday; soybean futures are 7
to 15 cents higher; wheat futures are 22 to 48 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the S&P down 25 points. The U.S. Dollar
Index is 40 points higher. Interest rate products are firmer. Energies are
mixed with crude up .55 and natural gas down .17. Livestock trade is mostly
higher. Precious metals are mixed with gold up 3.50.
Corn futures are 4 to 5 cents lower at midday with flat spread action as
trade fades further back to the middle part of the range with little fresh
news. The daily export wire has been quiet, while basis is showing some signs
of life again. Ethanol margins will continue to be squeezed by input costs with
soft driving demand and still-burdensome stocks into late spring. The second
crop in Brazil will head for the homestretch with drier weather in much of
Brazil with some potential early frost threats short term. U.S. weather remains
challenging for many in the short term with the north seeing a more-open,
short-term forecast while remaining cool. On the July contract chart, we have
resistance at the 20-day moving average at $7.93 with the lower Bollinger Band
at $7.67 as support.
Soybean futures are 7 to 15 cents higher at midday with spread action
continuing to firm with July working just above the $17.00 area Friday morning.
Meal is $3.00 to $4.00 higher and oil is 170 to 180 points higher with crush
margins working to rebalance after meal led this week. South America is moving
toward post-harvest footing at this point, with planting in the U.S. to
continue to progress well in some areas with emergence catching up with the
warm stretch. New-crop November is gaining against corn this morning, with time
running short to hold acres. On the July soybean chart, we are well above the
20-day moving average at $16.50 with the upper Bollinger band at $17.19 the
next round up.
Wheat futures are 22 to 48 cents lower with spring wheat the downside leader
with better planting progress expected short term; however, we see little
change to Northern Hemisphere weather and the political situation. The U.S.
dollar has faded off the top of the range as well. Warmer weather is helping
maturity to catch up a bit, while the Kansas wheat tour finds generally
disappointing yields with an average below 40 bushels per acre (bpa). KC wheat
is back to a 21-cent discount to Minneapolis in narrower action, and at an
82-cent premium to Chicago, narrowing a bit as well. The KC July chart has
resistance at the upper Bollinger band at $13.73, with the 20-day moving
average well below the market at $12.04.
David Fiala can be reached at [email protected]
Follow him on Twitter @davidfiala
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