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DTN Midday Grain Comments     10/26 11:11

   Grains Trending Lower at Midday

   Corn is 1 to 2 cents lower, soybeans are flat to 2 cents lower, and wheat is 
9 to 15 cents lower.

David M. Fiala
DTN Contributing Analyst

   The U.S. stock market is weaker with the Dow down 700. The dollar index is 
31 points higher. Interest rate products are higher. Energies are weaker with 
crude down $1.35. Livestock trade is mostly lower. Precious metals are mixed 
with gold up $1.70.


   Corn trade is 1 to 2 cents lower at midday with mixed spread action to open 
the week as we hold off inverting December/March for now. The export wire is 
expected to remain active with the recent spread strength but no sales were 
announced today. Ethanol margins remain under pressure with corn values 
elevated as ethanol retains its premium to unleaded amid weakness in energies. 
Basis will likely remain solid with snow slowing harvest. Weekly export 
inspections were soft at 636,290 metric tons, with weekly crop progress showing 
harvest past 75% and solidly ahead of normal but slowing with the weather. On 
the December contract resistance is the fresh high at $4.20 with support the 
20-day at $3.95.


   Soybean trade is flat to 2 cents lower at midday with trade holding just 
below the fresh highs in two-sided trade to start the week. Meal is $2.00 to 
$3.00 lower and oil is 35 to 45 points higher. Brazil should continue to make 
planting progress with the better rains short term, while Argentina continues 
to remain slow in moving soybeans to crushers as their currency erodes in value 
with the stronger dollar accelerating weakness to start the week. Basis remains 
strong as we continue to work to max out our logistics capacity to ship the 
needed export bushels. Weekly export inspections remain very strong at 2.664 
million metric tons. Weekly crop progress should show harvest nearly complete. 
The November chart has resistance at the fresh high at 10.89 3/4 with support 
the 20-day at 10.43.


   Wheat trade is 9 to 15 cents lower at midday with wetter weather encouraging 
selling to start the week. The ruble action continues to favor Russia a bit in 
the export markets but their domestic prices are now elevated but with improved 
short term weather, along with too much rain in Australia as harvest starts. 
Middle East buyers are becoming more active with tenders as well. KC is at a 
68-cent discount to Chicago with spreads back to the recent highs, while 
Minneapolis is back to 56 cent discount with very active spread action. Rains 
look to be more wide spread for U.S. growing areas over the next seven-10 days. 
Weekly export inspections were a bit softer at 363,806 metric tons. Kansas City 
December chart resistance is the fresh high at $5.79 1/2, and support is the 
20-day at $5.38.

   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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