DTN Midday Grain Comments 01/27 11:00
All Grains Lower at Midday
The U.S. stock market is weaker with the Dow down 460. The dollar index is
15 points higher. Interest rate products are weaker. Energies are weaker with
crude down $1.50. Livestock trade is sharply lower. Precious metals are mixed
with gold $10.00 higher.
By David Fiala
DTN Contributing Analyst
Corn trade is 8 to 9 cents lower with broad commodity weakness to start the
week with concerns about coronavirus encouraging position liquidation until we
see more clarity on short-term demand. Ethanol margins should get a boost from
cheaper corn, but blender margins have narrowed with ethanol futures still at
the lower end of the range. U.S. weather should allow for better weather short
term. Basis should remain sideways. The weekly export inspections improved to
668,559 metric tons. The daily wire showed a couple of sales to Japan for new
crop. On the March contract support is the lower Bollinger Band at $3.79 and
then recent lows at $3.77, with resistance the top of the fresh gap at $3.84.
Soybeans trade 9 to 12 cents lower at midday with selling tied to the broad
weakness in all markets, and continued progress in South America. Meal is $1.50
to $2.50 lower, and oil is 80 to 90 points lower. The Brazilian ral remains
very cheap as well hurting U.S. export competitiveness. South American weather
remains within the recent pattern for soybeans as well with early harvest
underway. Basis has remained steady at processors with the strong crush margins
and poor weather. Weekly export inspections were steady at 1.038 million metric
tons. The March chart support is the $8.82 contract low, with resistance the
lower Bollinger Band at $8.97.
Wheat trade is 2 to 7 cents lower with trade following the lead of the row
crops overnight with little fresh wheat-specific news. Cold threats remain
limited for the plains with limited potential short-term moisture. Kansas City
is at an 84 cent discount to Chicago, while Minneapolis is back to a 23 cent
discount. Weekly export sales inspections were soft at 223,994 metric tons. The
March Kansas City chart support is the lower Bollinger Band at $4.71, and
resistance is the 20-day at $4.86.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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