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DTN Midday Grain Comments     05/23 11:13

   Grains Higher at Midday

   Trade is mildly firmer across the board at midday. 

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are weaker with the Dow down 110 points. The 
interest rate products are weaker. The dollar index is 40 points higher. 
Energies are weaker with crude down 0.50. Livestock trade is sharply higher. 
Precious metals are mixed with gold up 1.00.

   CORN

   Corn trade is 2 cents higher at midday and near our daily highs and highs 
for the move; new highs on the December contract were seen moving just above 
$4.25. Warm weather should dominate the week, with rain coverage looking better 
for the west. The second crop areas of Brazil are trending back drier in the 
near term with some storm damage. Weekly ethanol production was down 350,000 
barrels, stocks were up 625,000 barrels with rising gasoline demand, helping to 
keep futures flat. On the July chart we moved back above the 20-day at $4.01 
with the next level of support is 50-day at 3.95 which we tested to start the 
week, with resistance at the recent high at $4.08. 

   SOYBEANS

   Soybean trade is 4 to 7 cents higher with trade scoring new highs for the 
move with new crop approaching the $10.50 mark again. Meal is $1.50 to 2.50 
higher and oil is 10 to 20 points higher. South America's recent pattern should 
remain intact near term, with the Real and Peso remaining near record lows and 
with harvest moving towards the home stretch in Argentina with quality concerns 
remaining. Crush margins have narrowed but remain positive, with meal starting 
to find buyers again today. On the July chart, trade is back just above the 
20-day at 10.26, with the 50-day at $10.38 the next round up, which we are just 
below. 

   WHEAT

   Wheat trade is 2 to 8 cents higher with spring wheat leading in two sided 
trade this morning. Warmer weather should help to boost maturity with the crop 
still behind normal, but catching up with another week of heat likely to add 
stress to the heading crop. Some better rain potential was showing for Kansas 
in the overnight forecast. Spring wheat should see better progress with warmer 
weather helping to catch up emergence. The Black Sea area will continue to 
dominate export trade with weather issues limited for the moment but some 
dryness so far with concerns starting to build, but better rains forecasted. 
Black Sea values are at $205 a ton. On the July Kansas City contract support is 
the 20-day at 5.33, with the upper Bollinger Band at 5.65.

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered adviser. 
He can be reached at dfiala@futuresone.com 
Follow him on Twitter @davidfiala


(BAS)

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