February 16, 2008

 

CBOT Corn Review on Friday: Settles higher; end-user buying supports

 

 

Chicago Board of Trade corn futures settled higher Friday, shaking off weakness from wheat and soybeans near midsession to settle higher in choppy trade.

 

March corn settled 3 3/4 cents higher at US$5.14 3/4 per bushel, and December gained 5 3/4 cents to US$5.38

 

Corn opened higher on spillover from higher wheat and soybeans and follow-through buying from the overnight session, said Brian Hoops, president of Midwest Market Solutions in Yanktonne, S.D.

 

The market retreated in sympathy with losses set in the other grains and on pre-weekend profit-taking but rebounded on end-user buying interest. Corn was well supported near session lows on good end-user buying, said Hoops.

 

The announcement of U.S. corn export sales to Japan and South Korea ahead of the opening was also positive for corn, a commission house analyst said. The U.S. Department of Agriculture reported that Japan had purchased 152,400 metric tonnes and South Korea bought 110,000 tonnes of U.S. corn for delivery in the 2007-08 marketing year.

 

Intraday short covering also supplied support "as people who sold a higher opening covered their short positions as the market did not see any follow- through selling," the commission house analyst said.

 

With the long weekend ahead of the market, people did not want to go home short, a trader said.

 

The CBOT is closed Monday for the Presidents Day holiday.

 

On daily open-auction technical charts, March settled at a new high close for the recent move and remained well above its major moving averages.

 

In open-auction trading, commodity fund buying was estimated at 3,000 contracts.

 

Market direction Tuesday will be determined by what happens in overseas markets, "outside markets," and any export news, the trader said.

 

In options trading, MF Global bought 3,000 March US$5.20 calls and bought 2,000 May US$5.00 puts and sold 2,000 July US$5.00 puts.

 

Oat futures ended higher with commercial buying in the deferred contracts leading December to set a new all-time high. December oats traded to US$3.95 per bushel, above the old high of US$3.94 per bushel set in the September contract in June, 1988.

 

March oats settled 3 1/2 cents higher at US$3.58 per bushel and December settled up 3 cents at US$3.95.

 

Ethanol futures settled higher. March ethanol rose 1.6 cents to US$2.233 per gallon and April ended up .003 cent to US$2.213.