DTN Midday Grain Comments     11/20 11:51

   Soybean Complex Firm; Corn, Wheat Trade Lower

   Soybean trade remains firm, with the market hanging onto our big weekly 
gains. Corn and wheat are lower in slow trade at midday.

By David Fiala
DTN Contributing Analyst

OUTSIDE MARKET SUMMARY: 

   The U.S. stock market indices are lower with the Dow futures down 67. The 
interest rate products are higher. The dollar index is 35 higher. Energies are 
lower with crude down $.80 cents. Cattle and hogs are higher. Precious metals 
are flat. 

General Comments

Corn 

   Corn trade is 2 lower at midday in slow trade. Corn has been lower due to 
the outside markets, with the higher soybean trade limiting downside. The 
December option expiration is today, and it does not seem like the trade wants 
the market neither over $4 nor under $3.90. So the rest of the session could be 
slow with December trade in the mid $3.90 area. The negative outside market 
action and pre-hedging ahead of the weekend would suggest there is a greater 
chance for a sell-off than a rally into the close. The chart argument remains 
positive and would suggest the opposite.

Soybeans 

   Soybean trade is firmer at midday with January up 5 and November new crop up 
a penny. Meal is $1.50 lower and bean oil is 15 higher. The outside market 
pressure may limit buying interest and push beans lower as we move into the 
afternoon. Nearby January resistance is up at $10.65, which was the August 
high. The January contract is moving into overbought territory, so a correction 
would not be a surprise even if you want to remain bullish. Support is down 
around the $10 level. The chart remains friendly as long as it stays above $10. 
The good demand numbers seen this week have supported the higher move. With the 
soybean harvest moving over 90 percent complete, the limited harvest selling 
pressure has allowed the strong move this week. The low on November 9 was 
$9.50, and the high today was $10.50 -- an impressive rally during harvest with 
yields and carryovers getting larger. 

Wheat 

   Wheat trade is 5 to 8 lower at midday across the three exchanges. The tone 
is flat with mixed spillover direction due to lower corn trade and higher 
beans. There is a lack of fresh supportive news that has limited buying 
interest and may lead to more longs taking profits ahead of the weekend. The 
chart remains positive. The fundamentals continue to remain poor. The recent 
rally has the U.S. priced out of the world market so do not expect export 
activity to pick up any time soon. Egypt is the number one importer of U.S. 
wheat. Their sales are down 70 percent year to date versus last year. Yesterday 
Egypt tendered for 175,000 tons of Russian wheat, which was originally 
announced as a U.S. sale. The higher dollar suggests a weak close. 

   David Fiala is a DTN contributing analyst and the President of FuturesOne 
and a registered Commodity Trading Advisor.


(KM)

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