March 23, 2007

 

CBOT Corn Outlook on Friday: Flat-up 2 cents on steady e-CBOT, outside markets

 

 

Chicago Board of Trade corn futures are expected to begin day session activity flat to 2 cents higher Friday as steady prices in overnight trading and spillover from higher crude oil prices are seen supporting prices, a floor trader said.

 

In overnight electronic trading, May corn gained 1 1/4 cents to US$4.10 3/4 per bushel, July also rose 1 1/4 cents to US$4.22 1/4 and December gained 1/2 cent to US$4.10. E-CBOT volume in May was 2,094 contracts.

 

Based off the steady tone in overnight trading and the higher start in crude oil futures corn futures should start out modestly higher, a floor trader said. However, there isn't a lot of fresh news out to provide much direction to prices, so it could be a choppy trading day, the trader added.

 

The wet weather forecasts has some market participants concerned about the possibility for planting delays; however, the market's attention is fixed on next Friday's U.S. Department of Agriculture's planting intentions report so it might be hard for corn to move much one way of another, a commission house analyst said.

 

The market has been trending higher on technical short covering and could be supported if participants decided to continue to cover positions ahead of the report, the analyst said.

 

In the western U.S. Midwest showers and thunderstorms are expected Saturday and lingering into Sunday with amounts 0.30-1.50 inches expected on Saturday, DTN Meteorologix Weather said. Temperatures are forecast much above normal in the period.

 

In the eastern sections of the region, daily episodes of rain are expected over the next several days with rainfall totals during the next three days 0.30-1.50 inches and locally heavier, Meteorologix Weather said. Temperatures are predicted above to much above normal in the period.

 

On daily open auction technical charts, CBOT May corn settled slightly lower but remains near the upper end of a four-week old down trending channel and bulls would gain better upside momentum by closing prices above solid chart resistance at US$4.15 per bushel, a technical analyst said.

 

First resistance for May corn is seen at US$4.11 1/2, this week's high and then at US$4.15. First support is seen at Thursday's low of US$4.06 and then at US$4.04.

 

In other corn news, corn futures on China's Dalian Commodities Exchange settled mixed with the benchmark September contract unchanged at RMB1,690/tonne.

 

Friday afternoon the Commodity Futures Trading Commission is scheduled to release the commitment of traders report for the period ending March 20.