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DTN Midday Grain Comments     02/20 11:04

   Grains Trending Lower at Midday

   Corn is flat to 2 cents lower at midday, soybeans are 1 to 2 cents lower, 
and wheat is 3 to 5 cents lower. 

By David Fiala
DTN Contributing Analyst

 General Comments



   The U.S. stock market is weaker with the Dow down 310. The dollar index is 
15 higher. Interest rate products are weaker. Energies are firmer with crude up 
$0.80. Livestock trade is weaker. Precious metals are mixed with gold up $12.00.


   Corn trade is flat to 2 cents lower with range-bound trade continuing as we 
already marked trade at $3.80 for the 15th-straight session with spread trade 
remaining firm. Ethanol margins are little changed with ethanol futures flat to 
start the week, with spring driving season and better blender margins getting 
closer and the weekly report showing production up 8,000 barrels per day, and 
stocks up 424,000 barrels to new record levels. Corn basis remains steady to 
slightly softer, with little change in recent days but more open weather should 
help movement along with March basis contracts coming due. Weekly export sales 
are delayed until tomorrow. On the March contract, support is the lower 
Bollinger Band and the fresh lows at $3.75, then the $3.71 4-month low, with 
resistance at the $3.94 recent 2 1/2 month high with the 20-day just above the 
market at $3.83 which we remain just below.


   Soybeans trade is flat to 2 cents lower at midday with the late gains from 
yesterday fading overnight before light buying during the day session. Meal is 
flat to $1.00 higher, and oil is 5 to 15 points lower. South America continues 
to make good progress with weather and harvest moving forward with little 
change on the horizon with some rain delays in Brazil in recent days. The 
Brazilian ral remains very cheap as well hurting U.S. export competitiveness 
near term with new lows scored this a.m. New crop soybeans will need to gain 
vs. corn to provide an acreage incentive ahead of planting in the U.S. with 
little progress on that front this week so far. The March soybean chart support 
is the 20-day moving average at $8.89, with resistance the upper Bollinger band 
at $9.08.


   Wheat trade is 4 to 6 cents lower with trade still trying to consolidate the 
move higher and buying remaining in short supply. Weather threats for the 
plains remain limited near term domestically with limited short term moisture 
across most of the plains and the east seeing the bulk of that, and most wheat 
still dormant with the cold snap. Kansas City is at an 86-cent discount to 
Chicago, regaining a dime the last few days while Minneapolis is back to an 29 
cent discount as well. World values remain mostly elevated with Chicago wheat 
expensive, and Kansas City wheat on the low end with Black Sea and European 
origin still the better deals for Middle East tenders, and Australia mostly out 
of the market at the moment. The March Kansas City chart supports the 20-day at 
$4.74, which we are testing, and resistance the upper Bollinger Band at $4.90. 

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered adviser. 
He can be reached at 
Follow him on Twitter @davidfiala


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