DTN Grain Midday: Futures Up Before WASDE

Young corn midrow. Image from University of Minnesota

Corn is 12 to 14 cents higher on the front month, 6 to 7 cents higher on new crop, soybeans are 2 to 4 cents higher and wheat 1 to 10 cents higher.

CORN:

Corn trade is 12 to 14 cents higher on the front month as spread strength continues to rebuild, with new crop 6 to 7 cents higher and little change to nearby forecasts. On the WASDE report later Thursday morning, trade is looking for steady yield projections with old-crop carryout at 1.207 billion bushels and new at 1.423 billion, both down slightly from last month, with world numbers to edge lower.

Ethanol margins remain solid with the energy complex remaining elevated. Brazil weather looks mostly unchanged short term as the crop advances towards harvest with some late rains while U.S. weather keeps the western part of the corn belt drier short term, with better rains to the east. Corn basis should remain flat to weaker near term with more attention going to new crop.

Weekly export sales were soft at 189,600 metric tons, and 26,400 of new. On the July contract, chart resistance is the upper Bollinger Band at $7.04, which we are testing at midday with the 20-day as support at $6.64.

SOYBEANS:

Soybeans are 2 to 4 cents higher at midday with flat to weaker spread action as trade stays near the upper end of the range but struggles to hold strength. Meal is flat to $1.00 higher and oil is 0.20 cent to 0.30 cent lower. The WASDE report is expected to keep yields steady with old-crop carryout at 122 million bushels and new crop at 146 million — both edging higher.

The weather pattern should allow for the end of first-crop planting and spraying of earlier planted soybeans with rains on the edges of the belt. South America should continue to see shipping progress short term, with U.S. basis soft and processors widening bids in recent days before stabilizing into midweek.

Weekly export sales were soft at 15,700 metric tons of old crop, 105,000 of new; meal 136,600 of old and 26,400 of new, and 3,200 of oil. On the July soybean chart, support is the 20-day at $15.53, which rallied back above, with resistance the upper Bollinger Band at $16.04.

WHEAT:

Wheat trade is 1 to 10 cents higher at midday with spring wheat leading in low volume so far and more relief showers expected. The WASDE report is expected to show old-crop carryout at 863 million bushels and new crop at 783 million bushels, both up slightly. Warmer weather this week should help to bring winter wheat along after the slowdown last week with early harvest getting underway on the far Southern Plains.

Other Northern Hemisphere weather will continue to be watched as well with little fresh news on the front. KC continues at a 43-cent discount to Chicago narrowing a bit, with Minneapolis at a 90-cent premium, almost 60 cents off the early week spike highs. Weekly export sales were soft at -1,400 metric tons of old crop and 325,900 metric tons of new.

KC July on the chart has resistance the 20-day at $6.31, which we are just above with the lower Bollinger Band below that at $6.00.

MARKET SUMMARY:

The U.S. stock market is firmer with the Dow up 110 points. The U.S. Dollar Index is flat. Interest rate products are mixed. Energies are flat to firmer with crude up $0.20. Livestock trade is mixed. Precious metals are mixed with gold down $3.00.

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