DTN Midday Grain Comments 03/19 11:32
All Grains Lower at Midday
Wheat and soybeans lead double-digit-lower midday trade.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower at midday with the Dow futures down
256 points. The interest rate products are firmer. The dollar index is 25
points lower. Energies are lower with crude down 0.60. Livestock trade is
lower. Precious metals are mixed with gold up $1.30.
Corn trade is 5 to 6 cents lower at midday to open the week with trade
seeing spillover pressure from the weak soybean and wheat trade. Another big
jump in the fund length seen on the Friday afternoon CFTC report and some
triggered chart selling is also noted for our lower midday action. Ethanol
margins remain positive with spring driving season approaching, bolstering
blender demand. Double-crop areas in Brazil look to build some moisture in the
coming days; with early harvest starting in Argentina. The USDA announced
206,000 metric tons sold to Japan, and 115,000 metric tons to unknown. The
weekly export inspections were strong at 1.409 million metric tons. On the May
chart, we slipped below the 200-day moving average at $3.79, with the 50-day at
$3.72 3/4 the next level of support.
Soybean trade is 16 to 24 cents lower at midday with wetter weather in
Argentina over the weekend and long profit taking noted for midday weakness.
Meal is $10-$11 lower and bean oil is 15 points lower. Outside markets have the
dollar 20 lower, stocks lower and crude lower giving negative commodity
influence. The weather pattern looks to return to some near-term dryness for
much of South America with U.S. weather viewed as neutral to negative with
rains in the western belt. Crush margins continue to narrow with meal dipping
lower, but they remain solidly positive. The weekly export inspections were
disappointing at 490,536 metric tons. On the May contract, support is the
50-day at 10.18 with resistance at the 20-day at 10.51.
Wheat trade is 10 to 25 cents lower with Kansas City trade seeing the most
pressure with rains moving across Oklahoma and Kansas last night and into the
this morning. The coming week looks drier again, but growth should be boosted
in the short term for many areas with good coverage across south-central Kansas
and parts of Oklahoma. The extended forecast is better for the eastern areas
with the west remaining on the dry side. The dollar index remains just below 90
on the index, with sideways trade continuing. Black Sea origin prices have
started to firm again, but the U.S. remains disadvantaged on the world market.
Weekly export inspections were on the upper end of expectations at 443,269
metric tons. On the May Kansas City wheat support is the 100-day at $4.65 after
we fell through the 50-day at $4.85 overnight.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at email@example.com
Follow him on Twitter @davidfiala
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