April 5, 2006

 

CBOT Corn Review on Tuesday: Down on soy, weather, thin buying

 

 

Corn futures at the Chicago Board of Trade settled modestly lower Tuesday as spillover weakness from soybeans, favorable Midwestern weather and the absence of fresh buying interest undermined futures, floor sources said.

 

Open auction trading was halted at 10:41 a.m. CDT due to data-feed problems and resumed at 11:20 a.m. CDT.

 

May corn settled 2 cents lower to US$2.34 1/2, July corn fell 2 1/4 cents to US$2.45 1/2 and December corn slid 1 3/4 cents lower to US$2.66 1/2.

 

There wasn't much interest in corn compared to recent sessions, a commercial-connected trader said. After trading resumed, it seemed like the interest dissipated further, he noted.

 

Weaker soybean futures after trading continued also added selling pressure, a floor analyst said. Light technical selling added to the dull tonnee, with May corn partially filling in the upside gap created in Friday's trade, a commission house trader said.

 

In addition, favorable weather across much of the U.S. corn belt is forecast over the next several days, limiting speculative buying, he added.

 

Mainly dry weather is forecast on Wednesday before the chance for showers and possible rain during Thursday and lingering into Friday in the western U.S. Midwest corn-growing region, DTN Meteorlogix Weather said.

 

In the eastern U.S. Midwest, light rain or showers are forecast to develop in the Delta late Wednesday with a chance for moderate rain with amounts of .25-1.00 inch on Thursday, DTN Meteorlogix weather said.

 

On technical charts, May corn partially filled in the upside gap created between last Thursday's high and Friday's low but finished above most moving averages.

 

Buyers Tuesday were JP Morgan, which bought 2,000 December, and Rand Financial bought 1,000 July. ABN Amro bought 700 May, the Refco division of Man Financial bought 500 July, and Man Financial bought 300 May.

 

Sellers on Tuesday included FC Stonnee, which sold 700 December and 100 July. JP Morgan sold 500 December, UBS sold 300 May, Tenco sold 200 May, Man Financial sold 200 July and 100 May, and RJ O'Brien sold 200 May and 100 December.

 

Commodity fund selling was estimated at 1,000 contracts.

 

Oat futures settled near unchanged with the market building a base at these price levels, an oat floor trader said. May oats ended unchanged at US$1.73 1/2, and July oats rose 1/4 cent to US$1.79 per bushel.

 

Ethanol futures finished mixed. The April contract, which did not trade, fell 7 cents to US$2.55 per gallon, with the May contract down 1 cent at US$2.55.