DTN Midday Grain Comments     05/22 11:18

   Wheat, Corn Higher at Midday

   Grain is pushing higher on supportive demand ideas.

By David Fiala
DTN Contributing Analyst

General Comments

   The U.S. stock markets are higher with the Dow up 90. The interest rate 
products are higher. The dollar index is 32 higher. Energies are lower with 
crude down $1.00. Livestock trade is mixed with strength in hogs. Precious 
metals are mixed with gold flat.  

   CORN

   Corn trade is 12 to 15 higher on old crop, and 6 to 9 higher on new. Outside 
markets are mixed this morning, with a strong stock market, a firmer dollar and 
lower crude oil. Corn is simply recoverying the losses seen on Tuesday. Weather 
looks to be more of the same in the near term, which will slow the remainding 
planting progress a bit, but overall weather is not a real friendly factor at 
this point. Ethanol production data was strong with a 2.1% increase over last 
week's levels, that were a multi-month high. Blender and producer margins 
remain good in the near term. The July chart has support at $6.33, and the 
December at $5.12. The USDA announced nine cargos of new crop corn sold, six to 
China, three to unknown. The bears may argue this is only scale down demand, 
but bulls argue corn has good value down in the area of our yearly lows. 

   SOYBEANS

   Soybean trade is narrowly mixed on old crop at midday while new crop is 4 to 
7 higher. Meal is $2 to 3 lower, and oil is flat to 15 points lower. The old 
crop rally has been running out of steam the past two days. Western processor 
basis collapsed on much better farmer movement due to the rally. Market bulls 
though argue the tight old crop situation is not disappearing and we still do 
not even have the crop in the ground yet so we have a long way to go before new 
crop bushels are available. On the Chart November is staying in between the 
50-day at $12.32 and the 20-day down at $12.12. Chinese soy prices remain 
strong, but their crush margins are soft in the near term. Argentina is looking 
for approval to export Biodiesel to the U.S. 

   WHEAT

   Wheat trade is 3 to 10 higher across the three exchanges this morning, with 
winter wheat showing more strength. This is a little bit of a correction versus 
Tuesday's action. Speculation about import purchases by Egypt and China 
continue to surface and a good close today could find more buying interest 
going into the end of the week. Rains have helped the Center and Eastern parts 
of the hard wheat belt, but the battered west has had little opportunity for 
improvement. Soft wheat is thought to be trading back into feed rations again 
with the strong corn basis. July Chicago wheat has support at $6.65 and 
resistance at $7.00. Russian weather forecasts continue to show improvement, 
and are limiting damage for now.

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered Trading Adviser


(BS)

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