DTN Grain Midday: Soybeans Reaching for the Sky

Soybean harvest. ©Debra L Ferguson

Corn is 4 to 5 cents higher, soybeans are 24 to 26 cents higher and wheat is 3 to 5 cents higher.

The U.S. stock market is firmer with the Dow up 110 points. The U.S. Dollar Index is 0.13 higher. Interest rate products are mixed. Energies are firmer with crude up $2.80. Livestock trade is mixed. Precious metals are mixed with gold flat.

CORN:

Corn trade is 4 to 5 cents higher at midday with trade shaking off poor export sales to follow soybeans higher. Ethanol margins are seeing support from energy values and rising world ethanol prices as well as spring driving demand. Trade will continue to look for further export-sale confirmations as the wire was quiet again Thursday with marketing-year low sales at 115,900 metric tons (mt) of old crop and 38,800 mt of new crop.

Basis should remain sideways short term as warmer weather will help to improve movement. Double-crop planting in Brazil is well underway as well but behind the usual pace. On the May contract, resistance is the 20-day at $5.46, which we failed to hold above Wednesday, with the lower Bollinger Band at $5.30 as support, which we bounced off Thursday morning.

SOYBEANS:

Soybeans are 24 to 26 cents higher at midday with strong spread action again as trade works to hold the upper end of the range, while new crop sees gains of 14 to 15 cents Thursday morning. Meal is $2.00 to $3.00 higher and oil is 1.90 cents to 2.00 cents higher.

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 as shipments build up steam with a record long line of ships to load. Argentina remains mostly dry short term. Weekly export sales were in line with expectations at 334,000 metric tons old crop and 199,400 mt of new crop, 187,400 mt of meal and 5,500 mt of oil. The May chart has resistance at the recent high at $14.45, with support the 20-day at $13.90.

WHEAT:

Wheat trade is 3 to 5 cents higher at midday with range-bound action continuing short term as trade looks for a spark from weather. The dollar is just above 91 points on the index, getting back to the upper end of the range with further consolidation needed to weigh on trade and choppy action so far 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. KC is at 29-cent discount to Chicago and Minneapolis is at 15-cent discount. Weekly export sales were soft at 219,200 metric tons of old crop and 23,500 mt of new crop. KC May chart support is the lower Bollinger Band at $6.11, with resistance the 20-day at $6.35, which we are just below at midday.

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