DTN Grain Midday: Wheat Leads Mixed Trade

Wheat harvest. Photo: Kansas State University

Corn and soybeans are narrowly mixed; wheat is 3 to 8 cents higher. Outside markets are positive.

CORN

Corn is narrowly mixed with light two-sided trade to start the week. Position squaring ahead of Thursday’s report is likely to dominate trade with oversold conditions in early week action. Ethanol margins will remain under pressure until we see improvement on the policy or margin side of things with futures flat and unleaded firmer this morning. Weather remains a short-term non-issue with warm temps for many, along with short-term rains.

Corn basis remains mixed to weaker overall with harvest getting closer but still too far away in some areas with board prices low. Export inspections remain soft at 590,013 metric tons. Weekly crop progress will likely show steady conditions and some gains in maturity with warmer temperatures.

On the December, nearby chart support is the $3.52 1/4 low with the lower Bollinger Band at $3.43 below that with resistance the 10-day at $3.63, with the 20-day next at $3.68.

SOYBEANS

Soybean trade is narrowly mixed with trade bouncing back from early selling in the day session as fresh news still limited. Meal is flat to $1.00 higher and oil is 0.10 cent to 0.20 cent lower. Crush margins remain bullish overall, with oil staying towards the upper end of the range and meal holding support so far.

Basis remains flat overall. The Brazilian real has found support versus the dollar but remains near record lows with Argentina expected to favor bean production because of political considerations. The weather looks to be a short-term non-issue for soybeans as well with maturity remaining the biggest concern with short-term warmth helping.

Weekly export inspections remain solid at 906,029 metric tons. Weekly crop progress is expected to show steady conditions, with maturity catching up some.

November chart support is the lower Bollinger band at $8.53, with resistance the 10-day at $8.65 that failed to hold last week.

WHEAT

Wheat trade is 1 to 9 cents higher with Chicago trade leading action higher at midday. The KC/Chicago spread is at 76, towards the top of the recent range. The corn/HRW spread is narrower, back to 34 cents. KC wheat is now back to competitive on the world market trading as well as into feed rations with Russian exports still working to get moving in a bigger way with a more sustained break needed in the dollar to help.

Spring wheat harvest is trying to play catch-up with the slow start in the northern hemisphere with difficulties lingering in many places. The weekly export inspections were softer at 402,486 metric tons, with inspections 1.3 million ahead of last year’s pace. Spring wheat harvest should be nearing 70% complete.

The December KC chart support is the new low at 3.80 with the first resistance the 10-day at $3.96, and the 20-day at $4.00.

General Comments

Corn and soybeans are narrowly mixed; wheat is 3 to 8 cents higher. Outside markets are positive. The U.S. stock market indices are firmer with the Dow 80 points higher. The dollar index is 18 points lower. Interest rate products are firmer. Energies are firmer with crude up $1.40. Livestock trade is mixed. Precious metals are weaker with gold $7.80 lower.

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