DTN Grain Midday: Early Gains Fade to Mixed Action

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Corn futures are 1 to 2 cents lower; soybeans are flat to 1 cent higher, and wheat is flat to 4 cents higher.

CORN

Corn futures are 1 to 2 cents lower at midday with prices surging on trade optimism and weather before fading with details still lacking on the nature of the China deal struck Friday. Harvest will remain slow but should show progress again by late week with the extended forecast looking wetter. Ethanol margins have improved to start the week with ethanol futures edging higher with idled plants still needing a return to harvest basis to restart.

Basis remains flat to weaker with anticipation of more inbound bushels soon. South American corn planting is underway, with second-crop shipments out of Brazil remaining active.

Weekly export inspections and crop progress will be delayed until Tuesday because of Columbus Day. On the December contract, support is at the 10-day at $3.90, and resistance the upper Bollinger Band at $4.02.

SOYBEANS

Soybeans futures are 1 to 3 cents higher after initially trading nearly a dime higher before fading with more details on trade and potential weather losses before shifting to two-sided action at midday. Meal is flat to $1.00 higher and oil is narrowly mixed. Crush margins remain good. Economically, U.S. export competitiveness remains improved, but at a steep currency disadvantage to South America with harvest needed to boost competitiveness.

Bean basis should see pressure again if the combines get rolling again next week. South America should make more progress this week and into the second half of the month with some weather issues remaining. On the November chart support is the 200-day at $9.10 with the upper Bollinger band at $9.39, and the spike high at $9.45 as resistance.

WHEAT

Wheat futures are flat to 4 cents higher, with the higher protein wheats leading and concerns about milling quality adding the most support after the row-crop spillover faded. The Chicago/KC December spread is 85 cents with choppy action continuing and KC gaining this morning.

Remaining spring wheat harvest will likely be stopped with the incoming cold front. The corn/HRW spread has widened back to 28 cents from 13 cents at the recent low, working wheat back out of rations. Export action continues to be dominated by Black Sea origin.

The December KC chart support is the $4.07-$4.09 area where the 10-, 20-, and 50-day moving averages are clustered with the upper Bollinger band at $4.27 3/4 as the new high is resistance.

General Comments

Corn futures are 1 to 2 cents lower; soybeans are flat to 1 cent higher, and wheat is flat to 4 cents higher. U.S. stock markets are mixed with the Dow up 40. The dollar index is 25 higher. Interest rate products are closed for Columbus Day. Energies are weaker with crude down 1.40. Livestock trade is firmer, led by cattle. Precious metals are mixed with gold up $8.00.

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