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DTN Midday Grain Comments 07/26 10:44
Grain Futures Slightly Lower Midday Monday
Corn is 4 to 5 cents lower, soybeans are 3 to 4 cents lower and wheat is 8
to 9 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is flat with the Dow up 15 points. The U.S. Dollar
Index is 0.35 lower. Interest rate products are mostly higher. Energies are
mixed with crude down $0.30. Livestock trade is mixed. Precious metals are
mixed with gold off $2.50.
Corn trade is 4 to 5 cents lower at midday to start the week with trade
remaining soft after some weekend rains and little fresh bullish news to induce
fresh buying, although we found buying on early weakness. Ethanol margins look
stable to start the week with energies moving more sideways after last week's
volatility. Brazil will continue to move along with the end of the second crop
season and frost issues still being watched, while near-term weather looks more
mixed into August for the U.S. Corn basis has remained flat with cash inverses
likely to see more pressure as wheat and southern sorghum start to become
available to feed. Weekly export inspections improved slightly to 1.037 million
metric tons (mmt), with weekly crop progress expected to show steady conditions
and average maturity. On the September contract, trade slipped further below
the 20-day at $5.60 with further support at the lower Bollinger Band at $5.22.
Soybeans are 3 to 4 cents lower with trade a bit off the early lows, and
meal remaining an anchor on the complex along with weather looking a little
less concerning short term. Meal is $2.00 to $3.00 lower and oil is 0.40 cent
to 0.50 cent higher. The weather pattern is warmer and drier short term with
more rain coverage in the extended forecast for many. South America will
continue to ship soybeans while the run in canola values turn more sideways.
Basis levels have been flat to weaker in recent days. Weekly export inspections
were rangebound at 241,187 metric tons with weekly crop progress expected to
show steady conditions and maturity just above normal. On the September soybean
chart, resistance is at the 20-day at $13.64, with the lower Bollinger Band at
Wheat trade is 8 to 9 cents lower at midday with early spread unwinding,
giving way to flatter action and little fresh news to push the complex appears
so far. Harvest will continue to expand across Europe and the Black Sea with
mixed results so far while the dollar is solidly lower Monday morning, which
could add support if sustained. KC holds at 39-cent discount to Chicago,
widening Monday, with Minneapolis at a 198-cent premium, moving sideways at
these levels. Winter wheat harvest is nearing its conclusion while spring wheat
conditions will likely stabilize at poor levels as harvest expands on the
cutable acres with export inspections in line with recent weeks at 477,964
metric tons. KC September on the chart has support at the 20-day at $6.29 with
resistance the upper Bollinger Band at $6.81.
David Fiala can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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