DTN Midday Grain Comments 12/04 10:54
All Grains Lower at Midday
Corn is 3 to 4 cents lower, soybeans are 5 to 6 cents lower, and wheat is 2
to 8 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 175. The dollar index is
flat. Interest rate products are weaker. Energies are firmer with crude up
$0.40. Livestock trade is weaker. Precious metals are mixed with gold down
Corn trade is 3 to 4 cents lower at midday with flat spread action with
range bound action continuing amid a lack of fresh news, although we did see
another 182,020 metric tons announced as sold to Mexico. Ethanol margins
continue to be crimped by weaker demand despite the energy complex being at the
upper end of the recent range, along with corn values holding the upper end of
the range. Basis remains generally strong. On the March contract support is the
lower Bollinger Band at $4.14 with the 20-day at $4.25 becoming resistance
which we are just below overnight.
Soybean trade is 5 to 6 cents lower at midday with trade so far failing to
extend the midweek rebound with exports remaining lacking, while South American
weather sees little immediate change. Meal is $3.00 to $4.00 lower and oil is
30 to 40 points higher. South America has rains coverage looking better for
Brazil than Argentina in the short term. Basis remains strong as we continue
ship and crush at a good clip. The January chart has resistance at the fresh
high at the fresh high at 12.00 scored last week, with the upper Bollinger Band
at $12.09, with support the 20-day at $11.62 which we are testing overnight
with the lower Bollinger Band at 11.14 below that.
Wheat trade is 2 to 8 cents lower overnight with choppy trade continuing
today with little fresh news for wheat. The dollar remains at the lower end of
the range but hasn't shifted export competitiveness in a big way so far. World
export tenders continue to go to Black Sea origin for the most part, with
little change in overall conditions there going into dormancy. The western
plains look to mostly remain dry short term with better moisture to the east.
Kansas City is at 33-cent discount to Chicago on the March with active trade
continuing, with Minneapolis at -28. Kansas City March chart resistance is the
20-day at $5.57 which we failed to hold late last week, and support is the
lower Bollinger Band at $5.41.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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