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
By David Fiala
DTN Contributing Analyst
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 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
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 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
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered Advisor.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
Copyright 2018 DTN/The Progressive Farmer. All rights reserved.
No other Daily email offers as much useful Ag information as DTN Snapshot – Sign up