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DTN Midday Grain Comments     07/01 10:48

   Grains Lower at Midday

   Corn trade is 7 to 11 cents lower; beans are 44 to 57 cents lower and wheat 
is 36 to 40 cents lower. 

David M. Fiala
DTN Contributing Analyst


   The U.S. stock market is weaker with the DOW down 75 points. The dollar 
index is 70 points higher. Interest rate products are higher. Energies are 
firmer with crude up 2.20. Livestock trade is firmer. Precious metals are 
weaker with gold flat.


   Corn trade is 7 to 11 cents lower at midday with two-sided trade as selling 
in soybeans and wheat drags trade off early gains with position squaring and 
fund liquidation heading towards the long weekend. Trade will continue to watch 
the forecast with more focus on corn pollination temperatures as we push into 
July with the back of the forecast looking warmer with better short-term rains 
expected for many, especially this weekend. On the report, numbers were in line 
with expectations are 4.436 billion bushels on hand vs. 4.434 expected and 
acres at 89.921 million vs. 89.861 expected. The export wire will need to show 
value buyers picking up bushels on the break with nothing on the daily report 
yet. The ethanol margins are likely to remain rangebound with strong blender 
margins remaining in place with unleaded rebounding a bit. Basis remains solid 
through most of the Corn Belt, with most place moving their bids to the 
September contract. On the September chart, support is the fresh low at $6.16 
1/2 with lower Bollinger Band just above that at $6.28 1/2, with the 20-day 
well above the market at $7.00. 


   Soybean trade is 44 to 57 cents lower at midday with broad selling 
accelerating as funds liquidate after trade failed to hold post report strength 
on the sharply lower acre number at 88.325 million vs. 90.446 expected with 
weather threats remaining limited short term. Mea1 is 12.00 to 13.00 lower and 
oil is 160 to 180 points lower. Also on the report, stocks were 971 million 
bushels vs. 965 million expected. Bio-diesel margins are very good at the 
moment which should bolster crush recovery into fall with fresh capacity 
expected to come online then although futures targets are up in the air with 
yesterday's Supreme Court ruling. South America is moving towards post-harvest 
footing at this point with planting wrapped up for the full season in the US, 
and getting started on double crop with wheat harvest moving quickly with 
moisture needed to boost development. Basis is fading a bit at processors and 
exporters in recent days with the daily wire remaining quiet. On the August 
soybean chart support is the lower Bollinger Band at $14.94 with the 20-day 
well above the market at $15.98.


   Wheat trade is 36 to 40 cents lower at midday with continued harvest 
pressure and spillover pressure keeping selling rolling with no surprises on 
the report with 660 million bushels on hand vs. 655 expected, and acres at 
47.092 vs. 47.017 expected. Plains weather should allow for harvest to continue 
moving with few areas slowed by rains. The dollar continues to hold in the 
upper end of the range with the strong ruble helping competitiveness as well 
with Russia expected to have near-record supplies with other Black Sea supply 
diminishes short term with trade waiting for the next set of import tenders. 
The KC September chart has support at the fresh low at $9.09 scored this 
morning with the lower Bollinger Band at $9.13 and the 20-day still well above 
the market at $10.80.

   David Fiala can be reached at 

   Follow him on Twitter @davidfiala

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