DTN Grain Close: Corn, Soybeans Higher as Rally Quiets

Photo: University of Minnesota

July contracts of corn and soybeans posted small gains Wednesday, but were down from higher levels in the morning when markets appeared more excited. Wheat prices finished mostly lower with July K.C. wheat down 6 3/4 cents.

 

Midday: The wet forecast boosts trade again on Wednesday.

CORN

Corn trade is 5 to 7 cents higher at midday with the ongoing wetter forecast and planting concerns driving the market with trade pulling back a little from the early highs. Drier weather will linger the next few days for many allowing some progress, with bigger rains expected into next week.

The weekly ethanol report showed production up 15,000 barrels per day, with stocks down 218,000 barrels, and ethanol futures closing in on $1.35. Basis will see pressure from increased farmer selling on the rally.

On the July nearby chart, support is 50-day at $3.71 which we moved through overnight, with the next level of resistance in the upper Bollinger Band at $3.75 5/8 which we are testing at midday, and then the 100-day at $3.81.

SOYBEANS

Soybean trade is 6 to 8 cents higher at midday with trade following the lead of corn, with the prior July gap at $8.40 being filled overnight. Meal is $2.00 to $3.00 higher and oil is 30 to 40 points higher. Crush margins remain solidly positive.

South American currencies remain cheap at the end of harvest, but rising basis is helping U.S. offers with the export wire more active in recent days.

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 U.S. gov’t payments to farmers look to be the more likely outcome at this point.

The July chart support is the 10-day moving average at $8.27, which we moved above overnight with the 20-day at $8.49.

WHEAT

Wheat trade is 4 to 10 cents higher at midday with winter wheat leading and support from the row crops again this morning.

Europe and the Black Sea area will be watched with dryness in the Volga Valley, and wet weather in the U.S. potentially limiting planting and causing disease issues in the winter wheat. The dollar remains rangebound. Hard red wheat is working into feed rations in some areas with the bounce in corn values.

On the July Kansas City chart support the 20-day at $4.06 that we moved above overnight, with the 10-day at $4.02 below that, and the 50-day at $4.28 the next round higher.

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