DTN Midday Grain Comments 02/08 10:58

DTN Midday Grain Comments 02/08 10:58 Corn, Soybean Futures Lower at Midday; Wheat Steady to Higher Corn futures are 6 to 7 cents lower at midday Tuesday; soybean futures are 16 to 18 cents lower; wheat futures are flat to 12 cents higher. David M. Fiala DTN Contributing Analyst MARKET SUMMARY: The U.S. stock market is firmer with the Dow up 275 points. The U.S. Dollar Index is 25 points higher. Interest rate products are weaker. Energies are weaker with crude down 2.50. Livestock trade is mostly higher with hogs leading. Precious metals are mixed with gold up 5.00. CORN: Corn futures are 6 to 7 cents lower at midday with broad commodity weakness; spread action is mixed so far. Ethanol margins continue to deteriorate in the short term with better demand needed to put a dent in the growing stocks; ethanol values are the weakest since April and driving demand is still soft. The WASDE report Wednesday is expected to show carryout at 1.498 billion bushels (bb), down slightly from last month, with South American estimates edging lower. Trade will continue to look for further sales confirmation on the daily wire with nothing to start this week. Basis should remain rangebound to slightly weaker in the short term, especially at the processors with weather likely to allow for better movement this week. Trade will continue watching South American weather as we head into second-crop planting and development along with new-crop strength in soybeans to swing acres late in the U.S. On the March contract we have support at the 20-day moving average at $6.17 then the fresh high scored last Monday at $6.42 1/2 as resistance. SOYBEANS: Soybean futures are 16 to 18 cents lower at midday with trade fading from the fresh highs scored Monday as fresh bullish news is lacking in pre-WASDE action. Meal is flat to $1.00 higher and oil is 200 to 210 points lower. On the report, trade is looking for domestic carryout at 308 million bushels (mb), down slightly, and South American production down by 8.3 million metric tons (mmt), which would be conservative versus recent private firm guesses. Basis is expected to remain flat to weaker in the short term with the active board trade. Crush margins continue to be supported by meal gains with oil action struggling at the highs as palm oil restrictions ease slightly. The daily wire was active Tuesday, with another 132,000 metric tons (mt) sold to China and 332,000 mt to unknown for new crop. Early harvest is underway in South America, likely to further crimp U.S. export competitiveness in February with mixed short-term weather with the southern growing areas looking to get the shorter end of rains in the next couple of weeks. On the March soybean chart, we have resistance at the fresh high at $15.89 1/2, with trade well above the 20-day moving average at $14.55 support. WHEAT: Wheat futures are flat to 12 cents higher with spring wheat leading trade back from a dime lower overnight to firmer action in the day session with strong spread action as we remain rangebound overall. The dollar has firmed slightly back into the middle part of the range. The WASDE report is expected to show carryout at 632 mb, up slightly from last month. Drier weather returns to the Southern Plains in the short term with warmer weather removing snow cover. Weather issues are more limited in the Black Sea for now. Fresh news from Ukraine and Russia remains limited on the political front. Spring wheat is firmer versus Chicago pushing the premium to $1.60 on the March, with KC at a 19-cent premium in soft action. KC March chart support is the 20-day moving average at $7.88, which we are just above at midday, with further resistance the Upper Bollinger Band at $8.28. David Fiala can be reached at [email protected] Follow him on Twitter @davidfiala (c) Copyright 2022 DTN, LLC. All rights reserved.