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DTN Grain Midday: Wheat Leads to Downside

Ernst Undesser
By David Fiala DTN Contributing Analyst April 20, 2017

DTN Grain Midday: Wheat Leads to Downside

Wheat leads trade lower at midday.

CORN

Corn trade is 2 to 4 cents lower with trade seeing spillover pressure from wheat and a general lack of buying enthusiasm. The weather forecast should allow for mixed planting progress in the near term with Nebraska, Iowa, and Illinois looking drier near term. Ethanol margins are stable this morning with futures edging higher, while corn values fade.

Acreage concerns going forward will limit downside. The weekly export sales were 756,400 metric tons of old crop, and 91,800 of new which was within expectations. On the May chart support is at the $3.54 3-month low with resistance at the $3.66 1/2 100-day moving average.

SOYBEANS

Soybean trade is flat to 3 cents lower at midday with early gains fading during the day session. Meal is $1 to $2 lower and oil is 15 to 25 points higher. South American harvest is on the back stretch, and trade may look to discourage US soybean acreage with the slow pace of corn planting early on with the spreads widening out in favor of soybeans through midweek. Basis has remained steady this week with softer crush margins.

The weekly export sales were mixed with old crop sales of 211,000 metric tons, 14,000 of new, 135,000 metric tons of old crop meal, 18,100 of new meal, and 33,200 of oil. Support is the 10-day moving average at $9.47, with the multi-month low at $9.29 below that, with resistance the 20-day at $9.54 above that, which we have tested overnight.

WHEAT

Wheat trade has washed out to new lows this morning after flat overnight trade with supply concerns returning to the forefront with short sellers being rewarded again.

The cold threat looks to be fading for this weekend with moisture remaining ok for most of the winter wheat belt, with North Central and North West Kansas inline for better moisture the next week. The Dakotas look wet enough to keep planting slow for now, but plenty of time remains with North Dakota remaining wetter with better South Dakota progress.

The Black Sea area is showing some near term dryness, but concerns remain limited for now, with early estimates of the crop down 7% from last year. The dollar index continues to track below 100 for now.

Weekly export sales were ok at 414,000 metric tons of old crop, and 137,200 of new crop. On the May KC contract support is at the $4.10 life of the contract low made this morning with resistance at the $4.23 20-day moving average.

General Comments

The U.S. stock market indices are higher with the Dow 115 points higher. The interest rate products are lower. The dollar index is 25 points lower. Energies are mixed with crude down $0.05. Livestock trade is mixed. Precious metals are mixed with gold up 0.50.

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Ernst Undesser
By David Fiala DTN Contributing Analyst April 20, 2017