DTN Grain Midday: Soybeans Down Hard

Mid-season soybean field. ©Debra L Ferguson

Corn is 12 to 13 cents lower, soybeans are 37 to 40 cents lower and wheat is 9 to 25 cents lower.

CORN:

Corn trade is 12 to 13 cents lower at midday with trade pulling back from the gap area overnight with fresh bullish news needed to push the market. Ethanol margins should stabilize with the corn pullback and energy rebound Thursday. Brazil will continue to evaluate the second crop as estimates drift lower, while the U.S. pushes deeper into pollination with a warmer and drier week ahead.

Corn basis has remained flat with cash inverses likely to see more pressure as wheat and southern sorghum start to become available to feed. Weekly export sales were poor with -88,500 metric tons on old crop and 47,700 of new.

On the September contract, trade is testing the 20-day at $5.58 at midday and the top of the gap at $5.88 looms above the market.

SOYBEANS:

Soybeans are 37 to 40 cents lower at midday with trade fading as meal is failing to hold gains while oil fades further from the highs to spur liquidation, and the forecast shows potential improvement down the road. Meal is $7.50 to $8.50 lower and oil is 1.70 cents to 2.00 cents lower.

The weather pattern is warmer and drier short term, with rains towards the end of the second week for much of the belt potentially. South America will continue to ship soybeans while the run in Canola values turn sharply lower.

Basis levels have been flat to weaker in recent days. Weekly export sales were poor at 62,000 metric tons of old crop, 176,300 of new crop; 68,300 of old meal and 19,100 of new, with oil at 700 metric tons.

On the September soybean chart support the 20-day at $13.58, which we are testing at midday, with $14.00 holding this week, and the upper Bollinger Band at $14.39 the next round up.

WHEAT:

Wheat trade is 9 to 25 cents lower at midday with spring wheat holding up better as spread trade shifts direction again with Chicago the short leg Thursday morning. Harvest will continue to expand across Europe and the Black Sea with mixed results so far while the dollar will provide headwinds at the upper end of the range with mild weakness so far Thursday.

KC holds at 38-cent discount to Chicago narrowing Thursday with Minneapolis at a 205-cent premium with a sharp swing from overnight levels. Weekly export sales were 473,200 metric tons of old and 5,000 for the 2022-23 crop year. KC September on the chart has support at the 20-day at 6.28 with resistance the upper Bollinger Band at $6.78.

MARKET SUMMARY:

The U.S. stock market is mixed with the Dow down 40 points. The U.S. Dollar index is 0.06 higher. Interest rate products are firmer. Energies are firmer with crude up $0.50. Livestock trade is mixed. Precious metals are firmer with gold up $2.50.

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