March 7, 2008

 

CBOT Corn Review on Thursday: Unchanged to higher; soy losses limit upside

 

 

Chicago Board of Trade corn futures settled unchanged to higher Thursday after a two-sided session, unable to maintain early gains as spillover weakness pressured prices.

 

May corn settled 1/4 cent higher at US$5.67 1/4, and December gained 2 cents to US$5.79 1/4.

 

Corn traded higher after the opening as light speculative buying provided underlying support, an analyst said. However, a sharp sell-off in the soy complex markets, with soyoil limit down and soybeans trading near limit down, pressured corn on spillover selling, the analyst said.

 

May soyoil settled 200 points lower at 66.05 cents a pound; May soybeans declined 49 3/4 cents to US$14.58 3/4 a bushel; and May soymeal ended US$11.70 lower at US$370.30 a short tonne.

 

However, concerns that U.S. planted corn acreage this spring could be lower than expected supported the new-crop contracts, said Jason Britt, an analyst at Central States Commodities. The U.S. Department of Agriculture at its recent Outlook Forum pegged corn planted acreage at 90 million acres, but there are expectations that the actual figure in the March 31 prospective plantings report will be lower. Until the report is released, new-crop corn should be well supported, said Britt.

 

Late in the session, corn was supported by some participants selling soybeans and buying corn, a trader said.

 

In open auction trading, overall commodity fund selling was estimated at 2,000 contracts.

 

On daily open auction technical charts, May corn traded an inside day, between the high and low established in Wednesday's session.

 

In options trading, UBS sold 1,500 May US$5.50 calls and bought 1,000 July US$5.10 puts. Newedge sold 2,000 May US$5.60 calls and 2,000 May US$5.60 puts.

 

Price direction Friday will be set by the government's unemployment report and how the outside markets react to it, a commission house analyst said.

 

Oat futures settled lower, undermined by spillover selling from the losses in the soy complex market, an analyst said.

 

May oats declined 8 3/4 cents to US$4.19 1/4 a bushel.

 

Ethanol futures finished with mild losses. April ethanol fell 2.3 cents to US$2.355 a gallon, and May was down 1.5 cents at US$2.330.