DTN Midday Grain Comments 04/22 11:10
All Grains Lower at Midday
Wheat is the downside leader at midday; some follow-though selling is noted.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed with the Dow 15 points lower. The
interest rate products are firmer. The dollar index is 20 points lower.
Energies are firmer with crude up 1.65. Livestock trade is lower. Precious
metals are mixed with gold up 1.50.
Corn trade is 2 to 3 cents lower at midday with trade back to test the
contract lows again as we return from Easter weekend that contained warmer
weather. There is little fresh news today. The continued fund selling was seen
on the CFTC weekly report after the conclusion of trade last week. The record
net fund short is now thought to be over 330,000. The forecast should allow for
better progress in much of the Belt this week with the north remaining slowest.
Ethanol blender margins will see another boost with the surge in the energy
complex to start the week with ethanol futures remain flat. South American
harvest should continue to move along toward completion. The weekly export
inspections were strong at 1.335 million metric tons. The weekly crop progress
report will likely show planting progress a step behind average. On the May
nearby chart support is the recent low at $3.55 then $3.52, with the 10-day at
$3.60 nearby resistance, and then the 20-day at $3.63.
Soybean trade is 1 to 2 cents lower at midday with trade following the corn
and wheat trade lower after some early light positive trade. Meal is flat to
$1.00 lower and oil is unchanged. Crush margins have faded but remain solidly
positive. South American currencies remain cheap as soybean harvest winds down
with the real edging slightly higher this a.m. On the trade front further
negotiations were announced with a projected end date in late May with trade
remaining in show me mode. The weekly export inspections remained soft at
382,298 metric tons. On the May chart, support is the recent low at $8.76 1/2,
and then the six-month low at $8.71, with resistance clustered in the $8.91 to
Wheat trade is 6 to 8 cents lower with fund selling still dominating in the
absence of fresh positive news. Europe and the Black Sea area will be watched
closely for further rains, with a mixed start to the year overall and no major
concerns currently. The U.S. high Plains look wet for Oklahoma and Texas, with
Kansas seeing a generally drier tint, and the north more open for progress.
Weekly export inspections were good at 811,850 metric tons. The weekly crop
progress report is expected to show steady ratings, with maturity near the
five-year average for winter wheat, while spring wheat will remain behind
normal on planting progress, but should start to narrow the gap this week. On
the May Kansas City chart, support the fresh lows at $4.11 1/4, with the lower
Bollinger Band at $4.13, and resistance the 10-day at $4.25.
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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