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DTN Midday Grain Comments     01/12 10:51

   Grains Mixed at Midday

   Trade is flat to lower ahead of the USDA WASDE, Stocks and Production 
numbers.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are higher at midday with the Dow futures up 
185 points.  The interest rate products are higher. The dollar index is 58 
lower. Energies are lower with crude down 0.20. Livestock trade is mixed. 
Precious metals are mixed with gold 8.30 higher. 

   CORN

   Corn trade is narrowly mixed with sideways trade ahead of the report coming 
at 11. Ethanol margins are fairly stable with the blender margins leading the 
way. The USDA announced 320,000 metric tons sold on the daily wire to unknown. 
Corn basis and carry remains fairly steady with carry decreasing in the cash 
market vs. the futures market in many areas. Cold weather will likely slow 
ethanol output in the near term. Livestock efficiency should struggle with the 
very cold spells and changing weather that is okay for feed demand in the 
bigger picture. Looking ahead to the January World Agricultural Supply and 
Demand Estimates (WASDE) as well as the Quarterly Grain Stocks report: the 
average guess is for production to be at 14.557 billion bushels with a carryout 
at 2.414 billion, and Dec. 1 stocks at 12.143 billion. Slightly lower than the 
past estimates, but no major change. The 2017 US Corn yield is expected to be 
at 175.2 bpa versus 175.4 on the November report. The world carryover is 
expected to be down around 1 million tons from the 204.1 million metric ton 
December USDA number. On the March chart support is the $3.46 1/2 contract low. 
Resistance is at the 20-day moving average at 3.50 1/4 then the 50-day at 
$3.54. 

   Soybeans

   Soybean trade is 3 to 5 cents lower making new lows ahead of the report in 
fairly quiet action, staying on the lows ahead of the report. Meal is $2 to $3 
lower and oil is narrowly mixed. South American weather is keeping the same 
basic forecast coming forward with mixed weather in Argentina and Brazil. Basis 
and carry remains mostly sideways. The USDA report is expected to come in at 
4.427 billion production, stocks at 3.181 billion bushels, and carryout at 472 
million bushels. On the March, support is the new low at $9.45 scored this 
morning, and resistance the 10-day at $9.63. 

   WHEAT

   Wheat trade is narrowly mixed at midday with trade staying just below the 
next resistance level ahead of the report. The current shot of cold area 
shouldn't be as threating but the Plains remain dry, while Russia has been 
warmer than normal, with minimal snow cover in case of a cold stretch. The 
dollar fallen down to 91 on the index with the general trend remaining down. 
Report expectations are for wheat stocks at 1.849 billion bushels, and carryout 
at 959 million bushels, and planted acres of 31.307 million acres of winter 
wheat. On the March Kansas City contract, chart support is the 10-day at $4.34, 
with the 100-day at $4.43 as the next level of resistance, which we touched 
this morning.

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered Advisor.
He can be reached at dfiala@futuresone.com 
Follow him on Twitter @davidfiala


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