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Thursday, May 23rd

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Friday, May 24th

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DTN Midday Grain Comments 05/23 11:01

DTN Midday Grain Comments     05/23 11:01

   Wheat, Corn Higher at Midday

   Grains lead at midday, with soybeans lagging ahead of MFP announcement.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are weaker with the Dow 360 points lower. The 
interest rate products are weaker. The dollar index is 6 lower. Energies are 
sharply weaker. Livestock trade is mostly lower. Precious metals are mixed with 
gold 11.20 higher. 


   Corn trade is 3 to 4 cents higher at midday with trade finding support from 
the wet forecast with trade still below $4.00 July. Wet weather is expected to 
remain in place for much of the western and central Corn Belt keeping the slow 
pace slow with warming temps will help emergence in spots, and the second week 
a little less wet. Ethanol margins are negative on a spot basis with ethanol 
futures unable to keep pace with corn and the energy complex sell off narrowing 
blender margins. Basis has seen selling pressure from farmer movement. Weekly 
export sales were in line with expectations at 442,100 metric tons of old crop, 
and 183,900 of new. On the July nearby chart support is the 200-day at $3.86 
3/4 with the 100-day at $3.81 below that, and the with the next level of 
resistance the upper Bollinger Band at $3.97, and then the recent high at $4.00.


   Soybean trade is flat to 2 cents lower with active two sided trade again 
with everyone waiting for more clarity on the rumored $2.00 a bushel trade aid 
expected to come out this afternoon, and if it is tied to 2019 production. Meal 
is narrowly mixed and oil is 25 to 35 points lower. Crush margins remain 
solidly positive overall with meal still remaining below $300 with a test of 
resistance overnight. South American currencies remain cheap at the end of 
harvest, with the export wire quiet this week. Field work should generally 
remain slow in the near term but more progress is likely into next week with 
little incentive for farmers to push right now along with acres possibly 
shifting to corn or milo with the corn soybeans ratio the narrowest in 8 years 
if the government doesn't pay to keep them in beans. The weekly export sales 
were inline with expectations at 535,800 metric tons of old crop, 5,100 of new 
crop, 188,000 of old meal, 112,000 new, and 9,100 of oil. The July chart 
support is the $7.98 lower Bollinger Band with the $7.91 low below that, and 
the resistance the 10-day at $8.25, which we are just above, with the next 
round the 20-day at $8.33, which we are tested but failed to hold yet again.


   Wheat trade is 3 to 11 cents higher with spreads swinging back to favor 
Chicago after narrowing the first half of the week with disease and demand 
concerns dominating. Europe and the Black Sea area will be watched with dryness 
in the Volga Valley expected to be eased in the near term, with spring wheat 
planting still catching up with disease issues in the winter wheat from wet 
weather. The dollar is back at the upper end of the range. Hard red wheat is 
working into feed rations in some areas with the bounce in corn values. The 
weekly export sales were 48,400 metric tons of old crop, and 344,900 of new. On 
the July Kansas City chart, support is the 50-day at $4.26 with the 100-day at 
$4.62 the next round up.

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


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