DTN Grain Midday: Soybeans Are Downside Leader

Photo: Kevin Hudson, Mississippi State University

Soybeans are the downside leader at midday.

CORN

Corn trade is 1 to 2 cents lower with spillover pressure from the soybeans turning action lower after light early gains. The western belt should be more open in the near term with the central part looking more open, and most rains concentrated to the east.

The weekly ethanol report showed production up 14,000 barrels per day, with stocks down another 514,000 barrels, with ethanol futures flat to slightly lower afterwards. South American harvest should continue to move along at a good clip.

On the May nearby chart support is the recent low at $3.55 then $3.52, with the 10-day at $3.61 nearby resistance, and then the 20-day at $3.66.

SOYBEANS

Soybean trade is 8 to 10 cents lower at midday with trade looking like it wants to set up a test of the lows after light early buying evaporated with little fresh news. Meal is $2.00 to $3.00 lower and oil is 10 to 20 points lower.

Crush margins have faded this week with basis trying to firm in spots of the central U.S. Brazil harvest is 88% complete with harvest pressure from South America likely to fade soon, while the ral and peso remain cheap vs. the dollar. Concrete trade progress remains lacking as well, but negotiations are continuing.

On the May chart support is the recent low at $8.79, and then the six-month low at $8.71, with resistance clustered in the $8.99 to $9.09 range.

WHEAT

Wheat trade is 2 cents lower to 3 cents higher with light profit taking on the winter wheats after the early week sell off. Europe and the Black Sea area will be watched closely for further rains, with a mixed start to the year.

The U.S. High Plains look drier in the near term, but moisture is very good for the moment with higher temps to boost growth, with progress in the north likely to remain behind pace but should be more open. The dollar remains in the upper end of the range. Russian estimates for this crop year indicate at rebound from 71-72 million metric tons to 83-84 million metric tons.

On the May Kansas City chart, support the fresh lows at $4.14, with the lower Bollinger band at $4.17, and resistance the 10-day at $4.29.

General Comments

The U.S. stock market indices are weaker with the Dow 35 points lower. The interest rate products are weaker. The dollar index is 2 points lower. Energies are narrowly mixed. Livestock trade is mixed. Precious metals are mixed with gold down $1.00.

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