January 5, 2006

  

CBOT Corn Outlook on Thursday: Called flat to down 1 cent

 

 

Corn futures at the Chicago Board of Trade are forecast to begin trading Thursday at slightly lower levels as thin losses overnight and the lack of fresh news are expected to keep futures on the defensive, sources said.

 

In overnight e-CBOT trading, March corn fell 1/2 cent to US$2.17 3/4 per bushel, May corn slipped 3/4 cent to US$2.26 1/4, and July corn fell 1 1/4 cents to US$2.34 per bushel.

 

Corn should start out the session on the defensive, a floor analyst said. There was not much news out overnight, precious metals are lower and the dollar is higher, he added.

 

A higher dollar makes goods priced in U.S. currency more expensive to overseas buyers, making U.S. farm products less competitive on world markets.

 

A floor trader cited the continued influence of commodity funds as a major factor in price direction. The market remains sensitive to what the funds want to do, he said.

 

Above normal to much above normal temperatures with light, scattered rainfall is predicted over the next several days in Argentina, DTN Meteorlogix weather said. Argentina is a key competitor in world corn export markets and its crop is entering the crucial reproductive stage of pollination and might be impacted by adverse weather conditions.

 

Cash corn basis bids were unchanged to mixed Thursday. Central Illinois was unchanged at 3 cents over the March, with St. Louis also unchanged at 2 cents over the March.

 

On technical charts, first resistance is pegged at US$2.19 3/4, Wednesday's high and then at US$2.21, this week's high. First support is seen at US$2.16 1/4, Wednesday's low and then at US$2.15 1/2, this week's low.

 

In other corn news, Corn futures traded on China's Dalian Futures Exchange finished lower Thursday with the most active September contract falling RMB5, ending at RMB1,386/tonne.

 

Weekly export sales, usually released Thursday morning, will be released Friday morning at 7:30 a.m. CST due to the holiday.