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DTN Midday Grain Comments     08/22 11:03

   Corn, Beans Lower at Midday

   Broad selling at midday except for wheat.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are weaker with the Dow 380 lower. The dollar 
index is 40 points lower. Interest rate products are lower. Energies are weaker 
with crude down 1.50. Livestock trade is sharply lower. Precious metals are 
mixed with gold 27.30 higher.


   Corn is 3 to 4 cents lower with choppy trade continuing amid fresh 
intensification of the trade war. Weather should continue to remain a 
short-term non-issue with continued cool weather the biggest concern at this 
point. Ethanol margins remain poor with blenders in the best position 
currently, with more plants likely to be idled with rumors of the refinery 
waivers to be reversed again refuted. Basis remains mixed overall with harvest 
getting closer. On the September nearby chart support is likely the $3.57 1/2 
low with the lower Bollinger Band at $3.47 below that with resistance the 
10-day at $3.65.


   Soybean trade is 8 to 11 cents lower with early buying disappearing again 
with trade slipping further into the lower end of the range amid the trade war 
intensification. Meal is 2.00 to 3.00 lower, and oil is 15 to 25 points lower. 
Crush margins remain positive overall, with oil staying towards the upper end 
of the range, and meal finding support at $2.90. Basis remains flat overall. 
The Brazilian real is at the lows again with the dollar strength, ensuring 
strong prices to domestic producers there, even with the midday dollar 
reversal. The weather looks to be a short-term non-issue for soybeans as well 
coming forward. The trade situation remains little changed as well. September 
chart support is the lower Bollinger band at $8.41, with the next round up the 
10-day $8.61 which we tested again today.


   Wheat trade is narrowly mixed at midday with trade seeing light choppy 
action after the strong finish yesterday. The Kansas City/Chicago spread is at 
78 after a high of 90 cents last week and a low of 71 cents this week with 
Kansas City gaining slightly overnight. The corn/HRW spread is wider, back to 
31 cents. Kansas City wheat is now back to competitive on the world market 
trading as well as into feed rations, although that has faded in recent days. 
Spring wheat harvest should expand with winter wheat just about wrapped up, 
with Europe progressing as well. The dollar remains near the upper end of the 
range, limiting upside potential. The September Kansas City chart support is 
the new low at 3.80 3/4 with the first resistance the 10-day at $3.89 which we 
are just above at midday, and the 20-day at $4.06.


   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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