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DTN Midday Grain Comments     02/08 11:32

   All Grains Lower at Midday

   Outside market weakness has grain trade lower with few changes expected on 
February report on Tuesday.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are lower with the Dow futures down 315 
points. The interest rate products are sharply higher. The dollar index is 18 
points lower after trading higher initially. Energies are lower with crude down 
60 cents. Livestock trade has hogs mixed and cattle at or near limit down. 
Precious metals are sharply higher with gold up $35.


   Corn trade is 2 cents lower at midday in slow action. Outside markets are 
pressuring corn but limited fresh selling interest at 3-week lows is around 
ahead of the USDA report. The weekly export inspections were low at 438,560 
tons.  The USDA monthly World Agricultural Supply and Demand Estimates (WASDE) 
are due out at 11 a.m. tomorrow. The average trade guess is for the domestic 
corn carryover to come in around 1.810 billion bushels versus 1.802 on the 
January report. World ending stocks are expected to be at 208.3 versus 208.94 
on the January report. With virtually no changes expected a modest 50-100 
million bushel surprise could give the market some direction and excitement 
tomorrow. For today the daily range has only been 4 cents with the midday 
market just a penny above the low. On the March chart we slipped below the 
$3.67 50-day moving average on Friday and below the 20-day at $3.65 1/2 
overnight which are now our two nearby resistance points. Support to note is 
$$3.60 then the $3.48 1/2 contract low. 


   Soybean trade is 3 to 4 cents lower at midday due to outside market 
weakness. Meal is fractionally higher and bean oil is down 55 points. With the 
Dow futures down over 300 points and crude lower outside markets are keeping 
buyers away for beans. The weekly export inspections were good for beans at 
1.1723 million metric tons which has limited downside. Looking to tomorrow the 
average trade guess for the February USDA domestic carryover is for it to come 
in at 445 million bushels versus 440 on the January report. The world carryover 
is expected to be at 78.95 versus 79.28 million metric tons on the January 
report. Expectations are for a small reduction in South American production of 
around half a million tons between Argentina and Brazil. Any unexpected modest 
changes on the report could give us a bigger move. On the March soybean chart 
support is at $8.63 then the $8.52 early January low. Resistance is at the 
$8.76 1/2 20-day moving average.  


   Wheat trade is 3 to 6 cents lower across the three markets at midday with 
light bearish momentum. Kansas City inched to a new contract low on Friday and 
has extended down today. Minneapolis and Chicago have not traded to new lows, 
but contract lows are their nearby chart support at this juncture. The weekly 
export inspections were neutral at 398,216 tons. Looking to tomorrow morning 
the average trade guess for the February USDA domestic carryover is 947 million 
bushels versus 941 million on the January report. The global carryover is 
expected to be at 231.5 million metric tons versus 232.04 seen last month which 
was a new high for the crop year. On the March Kansas City chart the low Friday 
at $4.51 1/2 was a quarter cent below the contract low; this is now nearby 
resistance, then the 10-day at $4.64. The new contract low at $4.46 1/4 is 
current chart support to note at midday.

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


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