DTN Midday Grain Comments 01/06 11:16

DTN Midday Grain Comments 01/06 11:16 Wheat, Beans Higher at Midday Trade is lower at midday in fairly quiet trade. By David Fiala DTN Contributing Analyst General Comments The U.S. stock markets are lower with the Dow down 160 points. The interest rate products are lower. The dollar index is 2 points higher. Energies are lower with crude $1.40 lower. Livestock trade is mostly lower. Precious metals are mixed with gold up $2. CORN Corn trade has been mixed and we are fractionally higher at midday with a negative outside market environment limiting upside. The North Korean nuclear test rattled markets with crude turning sharply lower, stock markets developing selling pressure, while the dollar remains near the upper side of the range. The weekly ethanol production report showed a 0.4% increase in production, stocks were 4.63% higher, and gasoline demand was 3.63% lower, which has ethanol futures down 4 cents but unleaded is down 8 cents. Basis should remain steady to soft with improved weather for movement here on the first week of the new year. Commercial buying on a scale down basis should continue to limit further weakness on any new visits to contract lows. On the March chart we have the 20-day at $3.67 as key resistance with the $3.50 low made on Monday nearby chart support. SOYBEANS Soybean trade is 1 to 3 cents higher at midday with improved commercial demand offsetting weather and outside markets. Meal is $1 to $2 higher, and oil is 30 to 40 points lower. The drier areas of Brazil are expected see an expansion in rains over the next 10 days, reducing concerns but some dry pockets will persist. Early harvest is underway in some areas of Brazil as well, potentially adding more competition for U.S. exports in the near term, along with the concerns about forward Chinese demand based on the economy. Basis should remain steady into midweek. March soybean chart support is at the recent lows at $8.53, with the 20-day at 8.72 resistance. WHEAT Wheat trade is 1 to 2 cents higher across the three contracts with light short covering surfacing at midday. The dollar turning stronger will limit buying enthusiasm as U.S. competitiveness slides. Ukraine is likely to see some winter kill in the near term with snow cover expected to increase soon. The US wheat belt is to see colder weather early next week, which could be a concern if snow cover doesn't materialize, and the pattern is sustained. On the March Kansas City chart support is at the $4.52 1/4 contract low printed earlier this week, with nearby resistance the lowest major moving average at $4.65 the 10-day moving average. David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered trading adviser. David Fiala can be reached at dfiala@futuresone.com Follow David Fiala on Twitter @davidfiala (BAS) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.