DTN Midday Grain Comments 09/26 10:44
Grains Lower at Midday
Corn trade is 5 to 6 cents lower, beans are 5 to 7 cents lower and wheat is
7 to 12 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is mixed with the Dow down 185 points. The dollar
index is 45 points higher. Interest rate products are weaker. Energies are
mixed with crude up $0.40. Livestock trade is mixed with cattle leading.
Precious metals are mixed with gold $5.50 lower.
Corn trade is 5 to 6 cents lower at midday with risk-off trade continuing
with the negative outside market environment along with expanding harvest to
open the week. Short-term forecasts have the center of the Corn Belt drier with
warmer-than-normal temps again into the weekend, which should keep harvest
progress around the five-year average on the weekly Crop Progress report Monday
afternoon. Steady conditions are expected, and overall maturity is expected to
remain slightly behind average. The export wire will need to show more life
soon with nothing today, and weekly inspections disappointing at 459,420 metric
tons. Ethanol margins will likely chop along with softer driving demand and
corn values keeping pressure on for now with natural gas fading a little to add
support. Basis will be watched to see how quickly we go to harvest footing
everywhere, and how aggressively the west will bid for corn in the deficit
areas into early harvest with some areas starting to show more strength. On the
December chart, trade is just below the 20-day at $6.78 with the lower
Bollinger Band at $6.60 as support.
Soybean trade is 5 to 7 cents lower at midday. The trade is continuing to
work the lower end of the range to start the week with the outside market
pressure and expanding harvest along with OK early progress for planting in
South America. Meal is $3.50 to $4.50 lower, and oil is 55 to 65 points lower.
South America has early planting underway with late demand picking up ahead of
the U.S. export window with the stronger dollar potentially pushing that
further out with Brazil in better shape than Argentina early on. Basis will
continue to shift toward harvest footing with trade watching to see how quickly
export shipments pick up into the end of the month. Inspections were soft again
at 257,547 metric tons with some further near-term basis pressure expected into
October. The daily wire has been quiet recently. Weekly Crop Progress is
expected to show harvest near the five-year average, with steady conditions and
maturity just slightly behind average overall. On the November soybean chart,
trade has the 20-day at $14.36, which we closed below Friday at resistance,
with the lower Bollinger band at $13.76.
Wheat trade is 7 to 12 cents lower. The trade is following the row crops
lower with two-sided action at times today. Fresh dollar highs and little fresh
bullish news is pulling trade further back from the highs scored last week.
Spring wheat harvest should be effectively wrapped up on the weekly report,
with winter wheat planting expanding with needed rains in some of the growing
areas to keep planting and emergence near the five-year averages. MATIF wheat
remains near the upper end of the range with some light pressure to start the
week as well. Weekly export inspections showed some strength at 520,464 metric
tons. The KC December chart has support at the 20-day at $9.22, and the Upper
Bollinger band at 9.84 as resistance.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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