March 25, 2006

 

CBOT Corn Review on Friday: End mixed after sideways session

 

 

Chicago Board of Trade corn futures ended mixed Friday, consolidating in a sideways pattern amid the absence of fresh fundamental news.

 

CBOT May corn settled 1/2 cent lower at US$2.18 3/4, July corn ended 1/2 cent lower at US$2.29 3/4 and December corn finished 1/4 cent higher at US$2.51 1/2.

 

The lack of directive influences promoted a subdued atmosphere, with pre-weekend trade positioning a featured attraction, analysts said.

 

The active May future hovered near the US$2.20 price level for most of the day, with prices grinding down heading toward next week's U.S. Department of Agriculture stock and planting reports. A lack of commodity fund buying strength that supported prices previously limited upside movement, with speculative and local selling pressuring futures heading into the close.

 

The session was filled with trade positioning, as prices hovered in sideways, consolidative trade. Futures need a dose of fresh fundamental inputs to generate interest, with analysts anticipating prices maintaining its grinding trend until the stocks and plantings report provides some near term direction.

 

Meanwhile, favorable pre-planting conditions, abundant supplies and bird flu issues remain bearish influences to limit upside potential. However solid underlying demand continues to be a bright spot for the market. Otherwise, activity was relatively quiet, with new/old crop spreading, and light options related activity ahead the expiration of April options featured attractions.

 

The DTN Meteorlogix forecast calls for a chilly trend to continue into the first part of next week, when values will rise to near to below normal over most of the corn belt and the Delta. As next week unfolds, a very promising round of rain and snow will move through the Midwest. Total precipitation from Tuesday through Thursday will range up to three-quarters of an inch in the western Midwest (west of the Mississippi River). The moisture will provide some soil recharge.

 

In pit trades, Merrill Lynch and Rand Financial each bought 400 May, JP Morgan bought 600 December, Fimat and Tenco each bought 200 May.

 

On the sell side, Fimat sold 800 May, JP Morgan sold 1,000 July, UBS Securities sold 1,500 May, Refco sold 300 May and Tradelink sold 500 May. Commodity funds were light net sellers on the day.

 

Ethanol futures ended mostly higher Friday. The April ethanol contract settled 1 cent higher at US$2.47 and May futures ended 5 1/2 cents higher at US$2.47 per gallon.

 

Oat futures ended mostly lower, with the rolling of May positions featured in light trade. CBOT May oat futures settled 1 1/2 cent lower at US$1.70 3/4 and July oats ended 1/4 cent lower at US$1.74 3/4 per bushel.