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DTN Midday Grain Comments     12/02 11:14

   Grains Flat to Higher at Midday

   Grain trade is flat to higher at midday.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are mixed with the Dow futures down 2 points 
and the Nasdaq up 20. The interest rate products are lower. The dollar index is 
30 lower. Energies are mixed with crude up $0.20. Livestock trade is mostly 
lower. Precious metals are mixed with gold up $6.60.


   Corn trade is 1 to 3 cents higher at midday with light buying surfacing 
overnight as we head toward the weekend with some profit-taking likely vs. 
fresh shorts established on the break. Ethanol margins remain strong with 
producer margins getting a boost from the lower corn, flat ethanol futures and 
firmer unleaded values this week, as well as improved export opportunities. 
Corn basis should have a firm tone with the break in futures slowing farmer 
selling, and the winter storm potentially disrupting trade next week. On the 
March chart resistance is at the $3.52 level where we find the 10-, 20-, 50- 
and 100-day moving averages, with support is now at the lower Bollinger Band at 


   Soybean trade is 1 to 3 cents higher at midday with trade seeing a less 
active day compared to earlier in the week. Meal is $2 to $3 higher and oil is 
down 25 to 35 points lower. South American weather will gain importance as we 
move into December with limited concerns in the near term with southeast Brazil 
in good shape. Basis should remain steady in the near term with farmer selling 
slowing with the rally fading and strong nearby crusher demand. The export wire 
was quiet again Friday with forward South American exports coming into focus. 
On the January chart, trade has edged back above the 10-day at 10.31 Friday 
morning with the 20-day at 10.10 support below that. Longer-term resistance is 
the $10.65 high earlier in the week.


   Wheat trade is flat to 5 cents higher at midday with the spreads favoring 
winter wheat after the shift toward the higher-protein Minneapolis wheat for 
the bulk of the week. Protein will likely remain the biggest near-term driver 
with plenty of lower-protein stocks that need to be blended off. Australian 
harvest should continue to make good progress in the near term with good yields 
coming in, extending the supply overhang. Cooler weather should push the crop 
toward dormancy with the Western Belt remaining a bit more open on weather with 
most moisture concentrated in Texas. The dollar is softer but remains about 100 
on the index, continuing to limit competitiveness. On the KC March chart, trade 
fell below the $$4.25 area where the 10- and 20-day moving averages were 
clustered, as they become resistance again, and support will be the recent lows 
at $4.01.

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered adviser.
He can be reached at 
Follow Fiala on Twitter @davidfiala


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