March 14, 2009

 

CBOT Corn Review on Friday: Climbs on concerns about planted acres

 

 

Chicago Board of Trade corn futures ended higher, extending the week's gains on concerns about planted acreage, analysts said.

 

May corn ended up 3 1/4 cents at US$3.88 1/2 a bushel, and July corn ended up 2 3/4 cents at US$3.98 1/4.

 

Analysts said Informa Economics' estimate of 81.4 million planted corn acres for 2009, released Friday morning during trading, helped keep the market firm even as wheat and soybeans slipped.

 

"What the Informa numbers suggest is that the shift away from corn and into soybeans accelerated between their last estimate and this month's estimate," said Dave Marshall, an independent commodity broker and adviser in Nashville, Ill.

 

The USDA currently projects planted acreage of 86 million acres, but many are expecting less plantings, and the trade is awaiting the March 31 planting intentions report.

 

Informa Economics' projection if realized would lead to significantly reduced ending stocks, said Terry Reilly, an analyst for Citigroup.

 

"You had some traders realize maybe we're going to plant a little less corn, so they found a little renewed corn-bean spreading," Reilly said.

 

"If you see anything at or below 82 million acres, and you start to develop a little bit or a weather problem sometime during planting and or during the growing season, then the corn carryout could potentially be cut in half from current levels," Reilly added.

 

Analysts added that corn was technically strong after breaking through its 50-day moving average Thursday and appears poised to test US$4.

 

Light farmer selling limited the market's gains Thursday and Friday, and could continue to do so early next week, as producers near the start of planting, analysts said. Reilly said some producers will continue to sit tight and see if prices can break US$4 and head to US$4.50.

 

The May contract gained 27 cents on the week.

 

CBOT oats futures ended slightly lower. May oats ended down 1 cent at US$1.86 a bushel and July oats settled down 1 cent at US$1.95.

 

Ethanol futures were higher. May ethanol ended up US$0.010 at US$1.580 a gallon and July ethanol ended up US$0.023 at US$1.603.