DTN Midday Grain Comments 01/15 10:52
Beans, Corn Lower at Midday; Wheat Mixed
Corn is 1 to 2 cents lower, soybeans are 6 to 8 cents lower, and wheat is 1
cent lower to 5 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow down 130. The dollar index is
48 points higher. Interest rate products are firmer. Energies are weaker with
crude down $1.50. Livestock trade is mostly higher. Precious metals are weaker
with gold off $27.50.
Corn trade is 1 to 2 cents lower with early gains fading to weaker action
during the day session with flat to weaker spread action and little fresh news
outside 110,000 metric tons booked to Mexico. Ethanol margins will remain poor
with soft demand, and no relief from corn values. Basis is likely to weaken
further in the short term as fresh cash demand remains weak. On the March
contract support is the 20-day at $4.80, with the next level up the upper
Bollinger Band at $5.42, and the contract high at $5.41 1/2 just below that.
Soybeans are 6 to 8 cents lower at midday with trade seeing pushes in both
directionS and new crop gaining vs. the front months but losing a bit vs. corn
on the new crop months, with confirmation of 368,000 metric tons of soybeans
booked for new crop. Meal is flat to $1.00 lower and oil is 100 to 110 points
lower. Basis has started to show pockets of weakness with crush likely to take
precedence over shipping in coming weeks with crush margins narrowing overall
although we have seen fresh bookings in recent days. Brazil should catch rains
short term, with the better action sticking around in Argentina for now with
labor unrest remaining an issue. The March chart has resistance at the fresh
high at $14.38 then the upper Bollinger Band at $14.58, with support the 20-day
Wheat trade is 1 cents lower to 5 cents higher at midday with trade spiking
on confirmation of Russian export tax hikes near term, with the possibility of
extending taxes post harvest before fading during the day session. The dollar
remains above 90 on the index with solid buying this morning. The Plains are
expected to see limited moisture with cold scares remaining limited for now.
Kansas City is at 29-cent discount to Chicago after hitting the tightest level
in weeks and then reversing, with Minneapolis at -29 tightening back up from
early weakness. Kansas City March chart support is the 20-day at $5.98, and
resistance is the fresh high at $6.60.
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