February 18, 2010

 

CBOT Corn Review on Wednesday: Down on profit taking, lack fresh support

 

 

Corn futures on the Chicago Board of Trade ended lower Wednesday, backpedaling on profit taking pressure in the absence of fresh supportive news.

 

March corn ended down 7 1/4 cents or 1.97% at US$3.60 per bushel, and May corn ended 7 1/4 cents lower or 1.91% at US$3.71 3/4 per bushel. Speculative fund selling was estimated at 7,000 lots.

 

The market lacked fundamental support to sustain Tuesday's rally due to large U.S. supplies and big crops that are expected in South America, analysts said. The absence of a strong export demand base added to the defensive theme.

 

The market retraced Tuesday's gains, with speculative profit taking featured. Consolidative selling helped futures stay on the defensive, as a firmer U.S. dollar discounted the broad based gains seen in commodities Tuesday on a weaker dollar, a CBOT floor analyst said.

 

A quiet news front kept attention on outside markets, as traders see the market lacking any reason to push higher without a jump in demand.

 

Otherwise, the corn market was seemingly content to stay in a recent trading range, with the downside limited after the recent break in prices, a CBOT floor analyst said. However, the upside is limited as well with a big U.S. crop in the storage bin, large South American production expected in the coming months, and a bump in 2010 U.S. acreage expected to be planted this spring, he added.

 

The DTN Meteorlogix weather forecast said some rain fell Wednesday in Argentina's La Pampa and heavier rain is expected Thursday. That system will move north on Friday.

 

U.S. Department of Agriculture's weekly export sales report, normally released on Thursday will be postponed until Friday, 8:30 a.m. EST due to Monday's Presidents Day holiday.

 

CBOT oat futures ended higher. March oats climbed 2 cents or 0.85% to US$2.38 a bushel, and May oats finished 2 cents higher or 0.82% at US$2.47.

 

Ethanol futures ended lower. March ethanol finished US$0.012 lower or 0.70% at US$1.706 per gallon, and April ethanol ended US$0.013 lower or 0.76% at US$1.782.