DTN Midday Grain Comments 01/13 11:20

DTN Midday Grain Comments 01/13 11:20 Corn, Beans Higher at Midday Row crops are higher at midday but struggles to extend Tuesday gains. By David Fiala DTN Contributing Analyst General Comments The U.S. stock markets are lower with the Dow down 40 points. The interest rate products are mixed. The dollar index is 4 points higher. Energies are mixed with crude 0.30 higher. Livestock trade is mixed. Precious metals are higher with gold up $8. CORN Corn trade is 2 to 4 cents higher at midday with trade finding more strength at midday after two-sided trade early. The weekly ethanol report showed production 0.70% higher, stocks are 1.17% higher, and gasoline demand was 4.80% higher, which has ethanol futures slightly lower. The market continues to digest the USDA numbers. The Final 2015 Corn Production was listed at 13.601 billion bushels versus 13.647 expected and the previous USDA 13.654. The revised domestic carryover though was at 1.802 billion versus 1.774 expected and 1.785 on the December report. Exports were down 50 million to make up for the crop reduction and imports raised by 10 million. The Quarterly stocks number was at 11.212 billion versus 11.250 expected and the world carryover was only 208.9 million tons versus 213.1 billion. All said there was something for everyone, but this may help curb bearish sentiment at contract lows. With no major weather concerns in South America, the biggest upside potential here appears to be the risk of the very large historic net-short-fund position covering. On March futures are just above the 10-day moving average at $3.55, and the 20-day is at $3.61. The 50-day at $3.70 is resistance above there; expect buy stops above the moving averages. The contract low at $3.48 1/2 remains major support. SOYBEANS Soybean trade is 3 to 6 cents higher at midday with trade shaking off early weakness as well. Meal is flat to $1 lower, and oil is 50 to 60 points higher. The USDA final production number was supportive for beans coming in at 3.930 billion bushels versus 3.983 expected and 3.981 on the December report. The domestic carryover was at 440 million bushels versus 471 expected and 465 on the December report. The minor change beside the drop in production was a 25-million-bushel drop in the export estimate. The Quarterly stocks number was at 2.715 versus the 2.718 billion bushels expected. The global carryover was only 79.3 versus 82.5 billion expected. Export sales have been more active this week. There were no changes in Brazilian or Argentine production for beans or corn. The forecast for South America limits major threats in the near term, while early harvest continues to gain steam with mixed yields. The 20-day at $8.70 is now support after the good finish yesterday. The 100-day at $8.88 is major resistance at this juncture. WHEAT Wheat trade is narrowly mixed across the three contracts this morning with trade following the row crops after some overnight selling after the bounce yesterday. The dollar has backed away from the overnight highs. The all-winter-wheat seeding number came in at 36.6 million acres versus 39.3 expected and 39.5 a year ago. The range of estimates was 38.3 to 40.8, so this was a significant number. But if weather cooperates and the yields are normal there is limited reason to expect the carryover to go down. The total usage estimate on the balance sheet dropped by 36 million bushels to 1.983 billion; this lead to a carryover at 941 million bushels versus 919 million expected. So even with lower planted acres production could be equal to usage and keep the carryover very high. The global carryover was bearish at 232 million metric tons versus 229.8 expected. Weather lacks major winter kill threats in the near term. On the March Kansas City chart support is at the $4.77 50-day, then $4.71 20-day with major support at the $4.52 1/4 contract low. Resistance is at $4.96, the 100-day in the longer term. 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.