DTN Midday Grain Comments 01/20 10:59
All Grains Lower at Midday
Corn is 5 to 6 cents lower, soybeans are 17 to 19 cents lower, and wheat is
4 to 6 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 195. The dollar index is
flat. Interest rate products are flat to lower. Energies are mostly higher with
crude up $0.45. Livestock trade is mostly higher. Precious metals are firmer
with gold up $24.50.
Corn trade is 5 to 6 cents lower with spread trade firming after trade
filled the $5.17 gap area and then bounced back into the day session. Ethanol
margins will remain poor with soft demand, and with limited relief in the cash
market short term. Basis is likely to weaken further as trade assesses near
term cash needs with the futures break adding support. The daily export wire
quiet today. On the March contract, support was the gap area at $5.17 which we
fell through overnight with the 20-day at $4.88 below that, with the next level
up the upper Bollinger Band at $5.47, and the contract high at $5.41 1/2 just
Soybeans is 17 to 19 cents lower at midday with trade off the 30 cent lower
overnight trade with spread action weaker to flat after some early strength.
Meal is $7.50 to $8.50 lower and oil is 60 to 70 points higher. Basis will
likely remain flat with crush likely to take precedence over shipping in coming
weeks with crush margins narrowing overall and new crop seeing more interest in
recent export bookings with nothing on the wire today. Brazil should catch
rains short term with very early harvest underway, with Argentina action mixed.
The March chart has support at the 20-day moving average of $13.36 with
resistance likely to start at the $13.82 area on a rebound which had been
Wheat trade is 4 to 6 cents lower at midday with trade following the lead of
the row crops in coming off the lows, and the higher protein wheats holding up
better so far. The dollar remains above 90 on the index with flat to higher
action this a.m. The Plains are expected to see limited moisture with cold
scares remaining limited for now. Kansas City is at 30-cent discount to Chicago
with sharply narrower trade overnight trade widening back out, with Minneapolis
at -30 as well. Kansas City March chart support is the 20-day at $6.05, and
resistance is the fresh high at $6.60.
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