DTN Grain Midday: Weather Market Takes Over

Wet fields delay spring planting. ©Debra L Ferguson

Grains enter a weather market trade on planting delays.

CORN

Corn trade is 13 to 14 cents higher at midday with trade gapping higher with the focus turning to slow planting and the wet forecast. Drier weather should be in play for this week for many with scattered showers with wetter weather for most expected to return after that with prevent plant dates getting closer.

Ethanol margins have remained stable with ethanol futures sharply higher. Basis will be choppy with river disruptions, and mixed demand, along with slow movement by farmers.

Weekly crop progress showed 30% planted, vs. 66% on average, with 10% emerged vs. 29% on average. This is the 3rd slowest since 1987, with only 1993, and 2013 slower at this point, and only 1995 as the only other year below 50% at this point.

On the July nearby chart support is the contract low at $3.43 with trade with the 10-day and 20-day moving average at $3.62 which we are above at midday, with the 50-day at $3.71 just above the market at midday.

SOYBEANS

Soybean trade gapped higher last night, following the lead of the corn and is trading 30 to 33 cents higher at midday. Meal is $11.00 to $12.00 higher and oil is 40 to 50 points higher. Crush margins remain solidly positive. South American currencies remain cheap at the end of harvest, but rising basis is helping US offers with 180,000 metric tons of crop hitting the daily wire.

Field work should generally remain slow in the near term but more progress is likely into next week with little incentive for farmers to push right now.

Trade talks are expected to continue, but more US gov’t payments to farmers looks to be the more likely outcome at this point with up to 15 billion in aid hinted at by the President yesterday. The weekly crop progress report showed planting at 9% vs. 29% on average.

The July chart support is the fresh low at $7.91, with resistance the 10-day moving average at $8.27, which we are above at midday with the 20-day at $8.53.

WHEAT

Wheat trade is 9 to 12 cents higher with winter wheat leading and support from the row crops this morning. Europe and the Black Sea area will be watched with dryness in the Volga Valley, and wet weather in the US. The dollar has drifted back to the lower end of the range with US export offers more competitive.

Weekly crop progress kept winter wheat conditions at 64% good to excellent, and 8% poor to very poor, unchanged, with heading at 42% vs. 54% on average, and spring wheat 45% planted vs. 67% on average with 10% emerged vs. 34% on average.

On the July Kansas City chart, support the fresh lows at $3.82, with the lower Bollinger Band at $3.81, and resistance the 10-day at $4.00, which we closed just above at midday, with the 20-day at $4.07, which we are testing currently.

General Comments

The U.S. stock market indices are sharply higher with the Dow 300 points higher. The interest rate products are firmer. The dollar index is 20 higher. Energies are firmer with crude up 0.90. Livestock trade is higher with hogs leading. Precious metals are mixed with gold down 6.00.

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