DTN Midday Grain Comments     01/27 10:55

   Soybean Futures Higher at Midday; Wheat Lower; Corn Mixed

   Corn futures are narrowly mixed at midday Thursday; soybean futures are 11 
to 15 cents higher; wheat futures are 5 to 12 cents lower. 

David M. Fiala
DTN Contributing Analyst

MARKET SUMMARY:

   The U.S. stock market is firmer with the Dow up 485 points. The U.S. Dollar 
Index is 75 points higher. Interest rate products are mixed. Energies are mixed 
with crude off .10. Livestock trade is weaker with hogs the downside leader. 
Precious metals are weaker with gold down 38.00.

CORN:

   Corn futures are narrowly mixed at midday with two-sided trade again at the 
upper end of the range with firmer spread action returning. Ethanol margins 
continue to deteriorate as stocks pushed to the highest levels since last May, 
with short-term demand remaining soft. Trade will continue to look for further 
sales confirmation on the daily wire with nothing hitting the wire today. 
Weekly sales were solid at 1.4 million metric tons (mmt) of old crop, and 
-165,000 mt of new. Basis should remain rangebound to slightly weaker in the 
short term with weather likely to slow short-term movement in some areas. Trade 
will continue watching South American weather as we head into second-crop 
planting and development. On the March contract we have support at the 20-day 
moving average at $6.05, then the fresh high at $6.31 as resistance, which we 
scored Tuesday. 

SOYBEANS:

   Soybean futures are 11 to 15 cents higher at midday with two-sided trade 
once again giving way to strong buying at midday with spread action firming and 
meal leading the product complex. Meal is $6.50 to $7.50 higher and oil is 50 
to 60 points higher. Basis is flat to weaker in the short term. Crush margins 
remain solid with future renewable diesel demand likely to keep good support 
under oil going forward, while meal has struggled with the $400 level in recent 
days but has surged above it at midday. Early harvest is underway in South 
America, likely to further crimp U.S. export competitiveness in February with a 
more mixed forecast again into February. No fresh sales showed up on the daily 
wire, with better demand likely needed to sustain fresh buying with the current 
forecast. Weekly sales improved at 1.03 mmt of old crop, 202,800 mt of new, 
330,100 mt of old meal, and -99,000 mt of new, with oil at 12,200 of old, and 
-100 of new. On the March soybean chart, we have resistance at the fresh high 
at $14.54, with trade well above the 20-day moving average at $13.90 support.

WHEAT:

   Wheat futures are 5 to 12 cents lower with spring wheat trade leading as 
winter wheat gives back a little more of the early week gains but has bounced 
back from the early weakness. The dollar is near new highs after the Fed 
statement Wednesday. Plains weather looks a little drier in the short term with 
the crop likely to stay dormant and some areas having better snow cover now. 
Spring wheat is firmer versus Chicago, moving the premium to $1.27 on the 
March, with KC at a 22-cent premium in firmer action. Weekly export sales were 
a marketing year high at 676,600 metric tons (mt) of old and 60,000 mt of new. 
KC March chart support is the 20-day moving average at $7.92, which we moved 
above, with resistance the Upper Bollinger Band at $8.38, which we have pulled 
back from after testing Wednesday.

   David Fiala can be reached at dfiala@futuresone.com 

   Follow him on Twitter @davidfiala




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