February 14, 2008

 

CBOT Corn Outlook on Thursday: Up 4-6 cents on spillover from strong wheat, soy

 

 

Chicago Board of Trade corn futures are expected to begin daytime trading 4-to-6 cents higher Thursday, following the strength in the other grains in overnight trading, analysts said.

 

In overnight electronic trading, March corn gained 5 1/4 cents to US$5.02 1/4 per bushel and December also rose 5 1/4 cents to US$5.24 1/2. Electronic trading volume in March was 8,397 contracts.

 

Corn will follow the strong gains posted overnight in wheat and soybeans, as there is little fresh news to influence corn on its own, an analyst said.

 

In overnight trading CBOT wheat gained 27 cents to US$10.18 1/2 per bushel and March soybeans ended up 15 cents at US$13.43 1/2.

 

In addition, corn could see some spillover from stronger crude oil prices and the dollar, a trader said. Nearby crude oil was trading over US$1 per barrel higher and the dollar was weaker, making U.S. produced goods cheaper to importers.

 

Weekly export sales were within the range of estimates and termed "solid" by an analyst.

 

The U.S. Department of Agriculture reported corn export sales for the week ended Feb. 7 totaled 980,400 metric tonnes. Included in the total were sales of 48,000 tonnes for delivery in the 2008-09 marketing year.

 

In Argentina, crops will probably benefit from warmer weather the remainder of this week with rain possible later this weekend, DTN Meteorlogix Weather said. Mainly dry weather is predicted through Saturday, with evening showers possible on Sunday. Temperatures are expected to average above normal in the period, Meteorlogix Weather said.

 

On daily technical charts, July corn closed lower as corn bulls are still fading, a technical analyst said. The sell-off in CBOT and KCBT wheat continued to pressure corn, the analyst said. The bulls' next upside price objective is to push and close prices above resistance at US$5.30 per bushel. The next downside objective remains closing prices below solid support at last week's low of US$5.14 1/4.

 

First resistance for July corn is seen at US$5.21 1/2, Wednesday's high and then at US$5.25. First support is seen at Wednesday's low of US$5.16 and then at this week's low of US$5.14 1/4.

 

In other corn news, Corn futures on China's Dalian Commodity Exchange ended with good gains as corn needed to catch up to recent gains in soybeans, the Dalian bourse said in a statement. The September contract settled RMB27 higher at 1,795RMB/tonne.