March 9, 2007

 

CBOT Corn Review on Thursday: Mixed; consolidates ahead of USDA report

 

 

Chicago Board of Trade corn futures ended mixed Thursday, with prices more in a consolidative mode ahead of Friday's supply and demand reports.

 

March corn ended 3 3/4 cents lower at US$4.12 per bushel, May corn settled 3 cents lower at US$4.21 1/2, and December finished 1 1/2 cents higher at US$4.10 3/4.

 

Overall activity was relatively subdued, with only a minor speculative fund presence and a quiet news front keeping traders cautious of taking on added risk ahead of government reports, analysts said.

 

Higher-than-expected weekly export sales provided support, but without some additional fresh news, the sales data failed to attract active buying. Despite outlooks for the U.S. Department of Agriculture not to make any meaningful changes in the U.S. corn balance sheet, traders took a nervous approach in case of a surprise, analysts added.

 

Nevertheless, bullish long-term fundamental outlooks kept new-crop months supported, with new-crop/old-crop spreading featured.

 

USDA is scheduled to release its March supply and demand report Friday 7:30 a.m. CST (1330 GMT). The average of estimates from a Dow Jones Newswires survey pegged corn 2006-07 ending stocks at 763 million bushels, up from February's estimate of 752 million. The estimates fell within range of 748 million to 802 million bushels.

 

USDA said net weekly export sales for corn were 1,258,700 metric tonnes; 2006-07 sales totaled 1,188,300 tonnes. The sales were 3 3/4 times higher than the previous week and 39% above the prior four-week average. Trade estimates called for commitments in the 700,000- to 900,000-tonne range.

 

In pit trades, ADM Investor Services bought 500 December, JP Morgan bought 300 May, Fimat bought 400 May and 500 December, UBS Securities bought 300 July. FCStonnee sold 400 May, JP Morgan sold 500 May and 3,000 December, Citigroup sold 500 May and Man Financial sold 300 May. Speculative fund buying was estimated at 1,500 contracts.

 

CBOT oat futures ended mixed Thursday, with nearby and deferred months diverging over direction. Position squaring was the feature of the day, with the unwinding of some new- crop/old-crop spreads noted, analysts said. May oats closed 3/4 cent higher at US$2.62 per bushel and December ended 1 cent lower at US$2.48.

 

Ethanol futures ended higher, with the April contract settling 0.050 higher at US$2.370, and the May contract settling 0.020 higher at US$2.240.