DTN Midday Grain Comments 06/30 10:52
Grains Lower at Midday
Corn trade is 13 to 15 cents lower, beans are 13 to 21 cents lower and wheat
is 3 to 12 cents lower.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow down 300 points. The dollar
index is 15 points lower. Interest rate products are higher. Energies are
weaker with crude down 3.05. Livestock trade is mixed. Precious metals are
weaker with gold down $11.
Corn trade is 13 to 15 cents lower at midday with improved forecasts and
position squaring ahead of the 11 a.m. CDT Stocks and Acreage reports. Trade
will continue to watch the forecast with more focus on corn pollination
temperatures as we push into July with the back of the forecast looking warmer
with better short-term rains expected for many. On the report, trade is looking
for 4.343 billion bushels (bb) in stocks vs. 4.111 billion last year, and a
range of 4.035 bb to 4.474 bb with acres at 89.86 million on a range of 88.4 ma
to 91.0 ma and the March number at 89.48 million. Weekly export sales were poor
at 88,800 metric tons old crop and 119,300 of new crop. The export wire will
need to show value buyers picking up bushels on the break with nothing on the
daily report yet. The ethanol margins are likely to remain rangebound with
strong blender margins remaining in place with unleaded continuing to fade.
Basis remains solid through most of the Corn Belt, with most place moving their
bids to the September contract. On the September chart, support is the fresh
low at $6.54 with lower Bollinger Band just below that at $6.47 1/2, with the
20-day well above the market at $7.08.
Soybean trade is 13 to 21 cents lower at midday with selling ahead of the
report after the four-day rebound from week-ago lows with trade waiting to see
if acres change today. Mea1 is flat to $1 lower, and oil is 115 to 125 points
lower. On the report, trade is looking for stocks at 965 million bushels (mb),
on a range of 740 mb to 1.1 bb, with acres at 90.44 million on a range of 88.7
ma to 92.35 ma and March at 90.955 ma. Weekly export sales were soft at
-120,200 metric tons of old crop, 127,600 metric tons of new crop, 23,900
metric tons of old crop meal, and 47,900 of new crop with oil at 1,200.
Biodiesel margins are very good at the moment, which should bolster crush
recovery into fall with fresh capacity expected to come online then. South
America is moving towards post-harvest footing at this point with planting
wrapped up for full season in the U.S. and getting started on double crop with
wheat harvest moving quickly with moisture needed to boost development. Basis
is fading a bit at processors and exporters in recent days with the daily wire
remaining quiet. On the August soybean chart, support is the lower Bollinger
Band at $15.06 with the 20-day well above the market at $16.05.
Wheat trade was 3 to 12 cents lower at midday with trade failing to hold
overnight gains again as harvest pressure fades for winter wheat and spring
wheat sees a less threatening short-term forecast becoming an anchor on the
complex. The push higher from the greater-than-expected Egypt buying faded with
spillover pressure from row crops. Plains weather should allow for harvest to
continue moving with few areas slowed by rains. The dollar continues to hold in
the upper end of the range with the strong ruble helping competitiveness, as
well, with Russia expected to have near-record supplies with other Black Sea
supply diminishing short term. On the report, stocks are expected to be at 655
million bushels on a range of 635 mb to 675 mb. Weekly export sales were solid
at 496,700 metric tons. The KC September chart has support at the fresh low at
$9.77 scored Monday with the lower Bollinger Band at $9.45 and the 20-day still
well above the market at $10.94.
David Fiala can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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