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DTN Midday Grain Comments     03/23 11:42

   Corn, Beans Lower at Midday

   Trade remains weaker at midday but well off the early lows.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are mixed at midday with the Dow futures up 25 
points. The interest rate products are firmer. The dollar index is 35 points 
lower. Energies are firmer with crude up 1.20. Livestock trade is lower. 
Precious metals are mixed with gold up $20. 


   Corn trade is 2 to 4 cents lower at midday with trade pulling back from 
initial gains as outside market instability weighs on trade. Ethanol futures 
have started to drift lower again and producer margins remain solid, which 
should continue into the weekend. Double-crop areas in Brazil look to build 
some moisture in the coming days; with early harvest expanding in Argentina. 
The daily wire was quiet today with the recent export pace slowing. Basis has 
started to firm again with the break in futures prices. The weekly export sales 
were good but off from prior weeks at 1.47 million metric tons.  On the May 
chart, we slipped below the 200-day moving average at $3.79, which is now 
resistance. The 50-day at $3.73 1/2 is support, which we are testing at midday.


   Soybean trade is 8 to 12 cents lower midday with trade seeing selling on 
outside market concerns with early trade as much as 20 cents lower. Meal is 
$1.00 to 2.00 higher and oil is 30 to 40 points lower. The weather pattern 
looks to return to some near-term dryness for much of South America with rains 
for much of the eastern belt incoming for the United States, with southern 
planting off to a slow start. Crush margins have improved with meal regaining 
forward momentum, with a close over $370 a ton likely needed to extend momentum 
with trade concerns to weigh on the market. Tariffs on US pork could push 
domestic production and boost imported soymeal needs for China. The export wire 
has been quiet with business shifting seasonally to Brazil. Weekly export sales 
were mixed at 759,100 metric tons of beans, 194,600 of meal, and 36,500 of oil. 
On the May contract, support is the 50-day at 10.21, which we are just below at 
midday with resistance at the 20-day at 10.49.


   Wheat trade is mixed at midday with higher protein trade gaining with drier 
weather in the western Plains again. The coming week looks drier again, but 
growth should be boosted in the short term after the recent rains, with rains 
pushing east. The dollar index is testing 89 on the index, which should support 
trade. Black Sea-origin prices have been more sideways, but the US remains 
disadvantaged on the world market. Weekly export sales were a little better 
than expected at 265,200 metric tons of old, and 164,300 metric tons. On the 
May Kansas City wheat support is the 100-day at $4.65 which we were able to 
bounce back from overnight, with the 50-day at $4.85 the next round up.

   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


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