DTN Midday Grain Comments 08/04 13:59

DTN Midday Grain Comments 08/04 13:59 Grains Mixed at Midday Wheat is the leader at midday with some double-digit midday gains, row crop trade is now flat to firmer. By David Fiala DTN Contributing Analyst General Comments Grains Mixed at Midday Soybean trade is slow but higher at midday while corn and wheat struggle. The U.S. stock market indices are mixed with the Dow futures down 8 points. The interest rate products are lower. The dollar index is 15 points higher. Energies are mixed with crude up 0.40. Livestock trade is firmer for cattle, weaker for hogs. Precious metals are lower with gold 8.90 lower. CORN Corn trade is 1 to 2 cents lower at midday in quiet trade. Outside markets are fairly neutral after the Bank of England cut interest rates. Ethanol margins found some support from the rally in energies yesterday, but we will need a stronger trend to generate much excitement. Ethanol is up less than a penny at midday. Corn basis has been fairly flat this week with trade waiting for remaining old crop bushels to be pushed into the market ahead of our expected record 2016 harvest even though the lower futures have kept farmer selling limited. We will have a record total supplies for the beginning of the 2016-17 crop year which means we will strain storage space. This should mean carry will still move out another 3/4 or a penny wider per month than current levels. The weekly export sales were over a million tons at 331,100 metric tons of old crop, and 896,300 of new crop, with 129,000 more announced on the daily wire this morning. On the December contract support is the contract low at $3.29 printed Tuesday. Resistance is the 10-day moving average at $3.39; then the 20-day at $3.48. The nearby September contract low, printed Tuesday, at $3.19 1/2 came very close to the $3.18 multi-year nearby low seen two years ago. SOYBEANS Soybean trade is 7 to 9 cents higher at midday with light buying returning again overnight with more export business showing up. Meal is flat to $1 higher and oil is 35 to 45 points higher. The key factor for beans remains weather as the reproductive process moves on. Moisture is in the forecasts and above normal heat is pretty limited in the forecasts going into the weekend and next week. The total coverage of meaningful moisture is closer to 50% so we can say the weather picture is not ideal, but it is non-threatening. Lower prices have helped keep export activity up. The daily export wires have been active, with another 252,000 metric tons announced as sold to China. Weekly export sales were strong at 542,200 metric tons of old crop, 1.13 million of new, 75,400 of old crop meal, 140,500 of new crop meal, 17,500 of old crop oil, and 19,000 of new. On the November soybean chart trade moved back above the 200-day at $9.56 level again overnight. Resitance above there is the 10-day at $9.72, then the 100-day and 20-day area around $10.15. Support is at the 3-month low of $9.43 then the lower Bolliger band at $9.20. WHEAT Wheat trade is 1 to 4 cents lower across the three contracts with early strength giving way to weakness during the day session with improved harvest in Russia this biggest story this morning. Another positive finish today would give trade a little more positive short term momentum, but trade might spillover from row crops to accomplish that late in the session. The spring wheat harvest should continue to progress well this week and next that may limit upside in Minneapolis. The European harvest will keep moving along with estimates for French production continuing to decline, with some coming in as low as 22 million metric tons vs. 41 mmt last year. Lower planted acreage for the 2017 crop due to the low prices is on the mind of the market, which may help support wheat versus new crop in the months ahead. The winter wheat planting season is not far off. The weekly export sales were softer at 362,400 metric tons. On the Kansas City December chart support is at the $4.24 contract low. Resistance is at the 20-day moving average at $4.40 then our one-month high at $4.58. 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.