DTN Midday Grain Comments 05/07 10:46
Soybeans Poised to Climb Higher Into Weekend
Corn is 3 to 4 cents higher with new crop flat, soybeans are 8 to 10 cents
higher with new crop 12 to 14 cents higher and wheat narrowly mixed.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 140 points. The U.S. Dollar
Index is 0.65 lower. Interest rate products are mixed. Energies are flat.
Livestock trade is mostly higher with cattle leading. Precious metals are
stronger with gold up $19.20.
Corn trade is 3 to 4 cents higher upfront overnight, with new crop flat as
spread trade is firmer. New crop came well off the overnight highs in choppy
action. Ethanol margins will see pressure from corn values, but good driving
demand and tight stocks will mostly offset that short term. Trade will continue
to watch for rains to benefit the rapid early corn planting progress, with some
key areas still short of moisture in the northern Corn Belt, while I-80 South
looks to be in line for good rains. Brazil continues to struggle with dryness
during pollination. Corn basis is holding firm throughout the belt. China
bought 1.36 million metric tons of new-crop corn on the daily wire with unknown
picking up 188,486 metric tons of old and new. On the July contract, chart
resistance is the fresh contact high at $7.28 3/4 with support the recent low
at $6.29 1/2.
Soybeans are 8 to 10 cents higher up front, and 12 to 14 higher on new crop
with two-sided trade Friday morning after strong buying overnight. Meal $3.50
to $4.50 higher and oil is 0.40 cent to 0.50 cent higher with more balanced
crush action than we've seen recently. Planters will continue to roll short
term with some areas of rain slowing action, but we will remain well ahead of
normal with northern areas still dry. South America should continue to see
shipping progress short term, while domestic crush will have to carry the U.S.
On the July soybean chart, support is the recent low at $14.90, with resistance
the upper Bollinger Band at $16.10.
Wheat trade is narrowly mixed at midday with trade struggling to hold gains
despite the sharply lower dollar and flatter spillover from row crops. KC is at
26-cent discount to Chicago with Minneapolis now 40 cents above Chicago with
intramonth spreads mixed. Seasonal weather on the Plains should boost growth
with dry concerns for spring wheat staying in place. Other Northern Hemisphere
weather will continue to be watched as well with little fresh news on the
front. KC July on the chart has support at the recent low of $6.86 3/4, and
resistance the upper Bollinger Band at $7.61.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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