DTN Midday Grain Comments 06/22 10:50
Grain Futures Mixed Midday Tuesday
Corn is 4 to 5 cents higher up front and 9 to 10 cents lower on new crop;
soybeans are 3 to 4 cents lower, and wheat is 3 cents lower to 24 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is firmer with the Dow up 45 points. The U.S. Dollar
Index is 0.08 higher. Interest rate products are mixed. Energies are mixed with
crude off $0.65. Livestock trade is sharply higher. Precious metals are mixed
with gold down $4.
Corn trade is 4 to 5 cents higher up front, with new crop 9 to 10 cents
lower as early strength on new crop fades as weather forecasts look manageable
for many short term, while spread strength continues to build again, taking the
July/Dec towards $1.20. Ethanol margins are seeing support from corn values
holding the lower end of the range with policy concerns limiting upside while
demand remains solid short term. Brazil weather looks mostly unchanged short
term as the crop advances towards harvest with some late rains while U.S.
weather is watched for follow-up rains as well as temps into July with less
heat stress for most this week. Corn basis should remain flat to weaker near
term with more attention going to new crop as well as feed wheat becoming
available. Weekly crop conditions were down 3% to 65% good to excellent, and 6%
poor to very poor. On the July contract, trade is back below the 20-day at
$6.65 failing to hold above on tests, with the lower Bollinger Band at $6.22 as
Soybeans are 3 to 4 cents lower with meal unable to support rallies so far
as oil recovers with no follow-up sales of new crop after the 456,000 metric
tons announced Monday. Meal is $4.50 to $5.50 lower and oil is 0.80 cent to
1.00 cent higher. The weather pattern should allow for better short-term
development with rains needed to boost double-crop areas during planting as
wheat comes off. Weekly crop progress showed conditions 2% lower to 60% good to
excellent, and 9% poor to very poor, with planting at 97% versus 96% on
average, emergence at 91% versus 85% on average and 5% blooming, same as
average. South America should continue to see shipping progress short term,
with U.S. basis returning to flat short term. On the July soybean chart,
support is the lower Bollinger Band at R13.65 as trade rebounds with the $14.50
area that was pre-washout support the next round up as resistance.
Wheat trade is 3 cents lower to 24 cents higher with spring wheat the leader
while winter wheat action is flat to start. The dollar is firmer, testing 92
points on the index again, holding the highest levels since March. Harvest
should continue to pick up steam with last week's heat pushing action along.
Other Northern Hemisphere weather will continue to be watched as well with
little fresh news on the front with Russia mostly OK for now. KC continues at a
58-cent discount to Chicago backing off the fresh highs Monday, with
Minneapolis at a 132-cent premium, getting back to the highs. Weekly crop
progress showed winter wheat at 49% good to excellent, 20% poor to very poor,
down 1% with 17% harvested versus 26% on average. Spring wheat is 27% headed
versus 18% on average, and 27% good to excellent; 37% poor to very poor, down
10%. KC July on the chart has resistance the 20-day at $6.20 with support at
the lower Bollinger Band at $5.88.
David Fiala can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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