April 6, 2006

 

CBOT Corn Outlook on Wednesday: Flat to 1/2 cent lower, lacking direction

 

 

Corn futures at the Chicago Board of Trade are expected to begin open auction trading steady to 1/2 cent lower Wednesday as the market is looking for direction in the absence of fresh news, sources said.

 

In overnight e-CBOT trading, May corn slipped 1/4 cent lower at $2.34 1/4 and July ended unchanged at $2.45 1/4.

 

Trading could be choppy, a floor analyst said. There was little in the way of fresh news overnight and the early season weather appears favorable for planting, he added.

 

Corn will be searching for direction Wednesday morning, a commission house analyst said. The outside markets are mixed with no clear direction, so the focus will be on the planting weather, he said.

 

In the western U.S. Midwest corn belt, there is a chance for a few light showers Wednesday with rain and possible thundershowers during Thursday and Friday, DTN Meteorlogix Weather said. Rainfall totals could be 0.50-1.50 inches and locally heavier, they added. Mainly dry weather returns during the weekend. Near term, temperatures will average above normal through Thursday.

 

In the eastern areas of the U.S. Midwest corn producing regions, there is a chance for scattered showers and thundershowers Thursday and Friday. Precipitation amounts could reach 0.30-1.50 inches with the heaviest amounts from the northern Delta through the eastern Midwest, DTN Meteorlogix weather said. Temperatures should average near to above normal Wednesday and Thursday, DTN Meteorlogix weather noted.

 

On technical charts, first resistance for May corn is seen at $2.35 3/4, Tuesday's high and then at this week's high of $2.38 1/2, a market technician said. First support is pegged at $2.33 1/2, and then at $2.32.

 

In other corn news, South Korea is expected to import more feed corn from the U.S. in marketing year 2005/06 and 2006/07 based on indications that China will exporting less corn, according to a U.S. Department of Agriculture report posted on the Foreign Agricultural Service web site.

 

Corn prices in major Chinese producing areas were slightly lower in the week ended Wednesday, as farmers increased their corn sales ahead of spring planting, sources in China said.

 

Corn futures on China's Dalian futures exchange settled at mostly higher levels with the benchmark September contract ending unchanged at RMB/1,397 per tonne.