DTN Grain Midday: A Red Wednesday

Corn is 6 to 8 cents lower, soybeans are 8 to 11 cents lower and wheat is 2 to 10 cents lower.

The U.S. stock market is mixed with the Dow up 140 points. The U.S. Dollar Index is 0.06 higher. Interest rate products are weaker. Energies are firmer with crude up $1.50. Livestock trade is firmer. Precious metals are weaker with gold down $11.50.

CORN:

Corn trade is 6 to 8 cents weaker at midday with broad selling returning to start the session after the Tuesday rebound, while new crop holds near the upper end of the range. Ethanol production rebounded sharply with gains of 191,000 barrels per day and stocks down another 360,000 barrels. Trade will continue to look for further export-sale confirmations as the wire is quiet again Wednesday.

Basis should remain sideways short term as warmer weather will help to improve movement. Double-crop planting in Brazil is well underway, but behind the usual pace. On the May contract resistance is the 20-day at $5.47, which we failed to hold above Tuesday; the lower Bollinger Band is at $5.32, which we remain just above.

SOYBEANS:

Soybeans are 8 to 11 cents lower at midday with spread action still strong, which has helped to limit further downside Wednesday morning, while new crop loses a little ground to corn. Meal is $4.00 to $5.00 lower and oil is flat to 0.10 cent lower.

Basis will likely remain flat at strong levels with slower movement as the export program winds down and a bigger focus is on crush margins. Brazil should remain rainy in the short term for most, with shipments building up steam and a record long line of ships to load; Argentina is remaining mostly dry short term. The May chart has resistance at the Upper Bollinger Band at $14.24, with support the 20-day at $13.87.

WHEAT:

Wheat trade is 2 to 11 cents lower with the Tuesday rebound fading again and intramonth trade slightly softer with fresh news lacking otherwise. The dollar is just below 91 points on the index, getting back to the upper end of the range with further consolidation at the upper end of the range needed to weigh on trade and choppy action returning this week. The Plains should see warmer weather, bringing the crop closer to exiting dormancy soon with some dry pockets persisting and spotty light rains possible across the Plains. KC is at 28-cent discount to Chicago and Minneapolis is at an 11-cent discount. KC May chart support is the lower Bollinger Band at $6.12, with resistance the 20-day at $6.35, which we have faded from overnight.

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