February 25, 2010

 

CBOT Corn Review on Wednesday: Higher on weather, outside-markets support

 

 

Chicago Board of Trade corn futures ended higher Wednesday, bouncing on weather concerns and outside markets.

 

March corn ended up 7 1/2 cents, or 2.04%, at US$3.75 1/4 per bushel, and May corn ended 7 1/2 cents higher, or 1.98%, at US$3.86 1/4 per bushel. Speculative fund buying was estimated at 11,000 lots.

 

The corn market is pricing in some weather premium, with underlying concerns about snow-packed Midwest fields raising thoughts of spring seeding delays that could lead to lower corn acres, said Mike Zuzolo, president Global Commodity Analytics and Consulting.

 

"These are just supportive talking points at the moment but, in the absence of fresh news fears off flooding due to the melting heavy snow cover, [it] is sparking some bullish thoughts," he said.

 

Weakness in the U.S. dollar and strength in crude-oil futures added to the supportive tonnee. The domestic cash grain market is now closely linked to energy prices, as roughly one-third of the U.S. corn crop is used to make ethanol, analysts said.

 

Reports of firm cash basis levels amid limit grain movement due to Midwest snow cover helped to buoy prices as well.

 

Meanwhile, reports that a commercial end user from the Southeast U.S. stopped accepting corn out of Ohio due to high vomitoxin levels in Southwestern Ohio added some bullish thought to market, according a market note from Top Third Ag Marketing.

 

On tap for Thursday, the U.S. Department of Agriculture's weekly export sales report will be released at 8:30 a.m. EST. Analysts surveyed by Dow Jones Newswires estimate corn sales for the week ended Feb. 18 to be in the range of 500,000 to 900,000 metric tonnes.

 

CBOT oat futures ended lower. March oats dropped 4 1/2 cents, or 1.99%, to US$2.22 a bushel, and May oats finished 4 1/2 cents lower, or 1.91%, at US$2.30 1/2.

 

Ethanol futures ended higher. March ethanol finished US$0.010 higher, or 0.59%, at US$1.713 per gallon, and April ethanol ended US$0.018 higher, or 1.06%, at US$1.719.