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DTN Midday Grain Comments 05/12 10:50
Corn, Soybean Futures Higher at Midday; Wheat Mixed
Corn futures are 1 to 2 cents higher at midday Monday; soybean futures are 8
to 9 cents higher; wheat futures are 1 cent lower to 3 cents higher.
David M. Fiala
DTN Contributing Analyst
MARKET SUMMARY:
Corn futures are 1 to 2 cents higher at midday Monday; soybean futures are 8
to 9 cents higher; wheat futures are 1 cent lower to 3 cents higher. The U.S.
stock market is sharply higher with the S&P 145 points higher. The U.S. Dollar
Index is 122 points higher. The interest rate products are weaker. Energy trade
is firmer with crude 1.50 higher and natural gas .15 lower. Livestock trade is
sharply higher. Precious metals are weaker with gold off 107.00.
CORN:
Corn futures are 1 to 2 cents higher at midday with flat spread action as
light buying returns as the weekend trade news of reduced tariffs for 90 days
with China builds into the market pre-report. Outside markets have energies
firmer and the dollar sharply higher, but we have been unable to hold the highs
so far. On the report at 11 a.m. CDT, trade is looking for old-crop carryout at
1.433 billion bushels (bb) and new crop at 2.02 bb. Ethanol margins should show
little change with corn and unleaded both firmer. Warmer weather into midmonth
should keep planting solidly ahead of the average pace with better rains the
second week to boost emergence. Weekly crop progress should keep planting and
emergence ahead the 5-year averages. Weekly export inspections remained solid
at 1.224 million metric tons (mmt), keeping us at 129% of last year's pace.
Basis should remain fairly sideways near term. Double-crop weather in Brazil
continues to have few issues as we get deeper into the growing season. On the
July chart, the 20-day moving average at $4.75 is resistance with support the
fresh low at $4.42 1/4.
SOYBEANS:
Soybean futures are 8 to 9 cents higher at midday with buying returning on
expectations of renewed demand post-trade deal ahead of the report; but we have
faded off the upper end of range. Meal is .50 to 1.50 higher and 125 to 135
points higher. On the report, trade is looking for 368 million bushels (mb) of
old-crop carryout and 375 mb on new. South American weather will remain
conducive to harvest progress. Warmer weather should boost planting pace and
emergence into midmonth, keeping us solidly ahead of average on planting and
emergence on the weekly report. Basis will likely find a little better
short-term action if crush can recover further. The daily wire saw 120,000
metric tons of old crop sold to Mexico with weekly inspections staying
rangebound at 426,077 metric tons (mt) with year-to-date pace at 110%. On the
July chart, resistance is the 20-day moving average at $10.50, which we are
well above at midday, with the lower Bollinger Band at $10.35 as support.
WHEAT:
Wheat futures are 1 cent lower to 3 cents higher with trade remaining
oversold at the lower end of the range and struggling with the sharply stronger
dollar ahead of the report. The hard red wheat areas are expected to see OK
short-term weather, along with near-term improvement in the Black Sea
continuing. Weekly crop progress should show steady conditions and development
slightly ahead of average, with spring wheat planting likely to remain solidly
ahead of average. On the report, trade is looking for old-crop carryout at 847
mb, and new at 857 mb. Weekly export inspections were OK at 405,170 mt with
year-to-date pace remaining at 115%. MATIF wheat is solidly higher to start the
week. On the KC July chart, resistance is the 20-day moving average at $5.44
with the next level of support the fresh low at $5.11 3/4.
David Fiala can be reached at dfiala@futuresone.com
Follow him on social platform X @davidfiala
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