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DTN Midday Grain Comments     05/25 12:47

   All Grains Higher at Midday

   Wheat leads at midday with soybeans and corn firmer heading towards the long 

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are mixed with the Dow down 10 points. The 
interest rate products are weaker. The dollar index is 45 points higher. 
Energies are weaker with crude down 2.70. Livestock trade is mostly higher. 
Precious metals are weaker with gold down 1.00.


   Corn trade is 1 to 2 cents higher at midday with trade following the lead of 
the firmer soy and wheat trade this morning, but we remain below the fresh 
highs scored yesterday with little fresh buying enthusiasm so far. Warm weather 
should dominate the week, with rain coverage looking better for the west, and 
better for the second week out with some model disagreement. The second crop 
areas of Brazil are trending back drier in the near term with some storm 
damage. Ethanol blender margins are narrowing with the energy complex pulling 
back well of the recent highs, while corn remains elevated along with ethanol 
futures holding over $1.52. On the July chart we moved back above the 20-day at 
$4.02 with the next level of support is 50-day at 3.95 which we tested to start 
the week, with resistance at the fresh high at $4.12 1/4. 


   Soybean trade is 3 to 6 cents higher at midday with trade trying to regain 
the momentum lost yesterday. Meal is $2 to $3 higher and oil is 25 to 35 points 
lower. Trucker strikes are disrupting logistics in South America as harvest 
winds down, and China was booking late summer soy cargos off the West Coast 
with sales of 312,000 metric tons of new crop sold today, along with 165,000 of 
option origin. Crush margins have narrowed but remain positive, with meal 
starting to find buyers again with trade $10 off the lows but struggling to 
hold gains. Basis has remained steady, with trade likely to remain quiet into 
the weekend. On the July chart, trade is just above the 50-day at $10.38, with 
the upper Bollinger Band at 10.64 the next level of resistance. 


   Wheat trade is 6 to 11 cents higher at midday with trade trying to shake off 
the turn lower yesterday, with profit taking likely going into the long weekend 
late in the session. 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 with areas south of I-70 starting to change. Some 
better rain potential was showing for Kansas in the overnight forecast but it 
is getting late to matter, especially for the second week. Spring wheat should 
see better progress with warmer weather helping to catch up emergence, with 
Canada remaining on the dry side. The Black Sea area will continue to dominate 
export trade with growing concerns about drier winter wheat, and slow spring 
wheat seeding. Black Sea values are at $206 a ton. India is raising import 
tariffs as well. On the July Kansas City contract support is the 20-day at 
5.37, 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 
Follow him on Twitter @davidfiala


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