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DTN Grain Midday: Trade Continues to Slip

Ernst Undesser
By David Fiala DTN Contributing Analyst October 17, 2017

DTN Grain Midday: Trade Continues to Slip

Trade is mostly lower across the board at midday.

CORN

Corn trade is narrowly mixed in quiet trade at midday with harvest pressure and weaker soybean trade weighing on the market, with some light two-sided action. Ethanol margins are stable with the seasonal usage expected to work lower but with blender margins improving with the recent firmer action in the energy complex.

The condition report had good to excellent 1 percentage point higher to 65% good to excellent. The weekly crop progress report had maturity at 90%, 4 percentage points behind average with harvest at 28%, 19 percentage points behind average with open weather this week likely allowing for much better progress. Basis should see harvest pressure, while carry remains at wide levels.

On the December chart support is at the 20-day at $3.50 which we are testing at midday with the contract low at $3.42 below that, with resistance the 50-day at $3.57.

SOYBEANS

Soybean trade is 3 to 6 cents lower at midday with pressure from expanding harvest and profit taking after the recent rally. Meal is $2 to $3 lower and oil is 5 to 15 points higher. NOPA crush came in at 136.42 million bushels, with oil stocks just below expectations at 1.302 billion pounds.

South American weather forecasts remains mixed with drier weather expected for Argentina to allow planting to progress while northern Brazil remains excessively dry for the early part of the growing season with the second week pattern looking to invert that which would allow for better progress.

Crop conditions had good to excellent 1 percentage point higher at 62% good to excellent. The weekly crop progress had 94% dropping leaves, 1 percentage point ahead of average, and 49% harvested, 11 percentage pointS behind average, and export inspections were strong at 1.77 million metric tons. Trade will be watching to see if activity continues to show up on the daily export reporting system with the rise in prices.

On the November chart, trade is above all the major moving averages, with the 200-day at $9.75 first support, with resistance the recent high at $10.03.

WHEAT

Wheat trade is narrowly mixed at midday with trade continuing to mark time near the lower end of the fall range, with pressure spilling over from the row crops, helping to blunt some early buying support. The dollar is solidly firmer this morning as it heads towards the recent highs.

U.S. exports have been slowed lately as Black Sea origin continue to dominate. Australia will see more focus coming forward as well as the growing season progresses with some flood damage concerns in South America. The weekly crop progress showed 60% planted, 11 percentage points behind normal, and 37% emerged, 6 percentage points behind.

On the December Kansas City support is the 10-day at $4.32 with resistance at the 20-day at $4.40.

General Comments

The U.S. stock market is higher this morning with the Dow up 35 points. The interest rate products are mostly lower. The dollar index is 35 higher. Energies are mixed with crude down $0.20. Livestock trade is mixed. Precious metals are lower with gold up $18.00.

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Ernst Undesser
By David Fiala DTN Contributing Analyst October 17, 2017