April 6, 2006

 

CBOT Corn Review on Wednesday: Higher on light fund buying

 

 

Corn futures at the Chicago Board of Trade finished with small-scale gains Wednesday as light fund buying and bottom-picking-type trading supplied support to the market, sources said.

 

It looked like light trend-following funds were buying in small amounts, a commission house analyst said. New fundamental inputs to trade on were scarce, however, he added.

 

May corn settled 1 3/4 cents higher to US$2.36 1/4 per bushel, July increased 2 cents to US$2.47 1/2, and December finished 1 1/2 cents higher to US$2.68.

 

Investors were bottom-picking on Wednesday, a floor trader said. The market is still reverberating from Friday's report and it still has to drive up prices to attract more corn acres, he added.

 

Beyond the weather, which is supportive to upcoming planting efforts, there was little fresh news to trade on, the floor trader noted.

 

Light showers are possible in the western U.S. Midwest corn-growing areas on Wednesday with a chance for rain and possible thunderstorms on Thursday and Friday. Amounts could range from .50-1.50 inches and locally heavier, before drier weather returns during the weekend, DTN Meteorlogix Weather said.

 

In the eastern U.S. Midwest, a chance for rain develops on Wednesday with a chance for scattered showers and thundershowers during Thursday into Friday, DTN Meteorlogix Weather noted. Rainfall should average .30-1.50 inches during this period, with the heaviest amounts from the northern Delta into the eastern Midwest.

 

On intra-day technical charts, it looks as though May corn is building a base at current price levels, a floor-based technical analyst said.

 

Buyers Wednesday included the Refco division of Man Financial, which bought 1,000 May. ABN Amro bought 800 May and 800 December, Rosenthal Collins bought 500 July, Man Financial bought 500 May, UBS bought 300 December, Calyon Financial bought 300May and ADM bought 200 December.

 

Sellers Wednesday included Tenco, which sold 500 December. UBS sold 400 December, JP Morgan sold 500 December, FC Stonnee sold 500 December, 300 May, and 200 July, O'Connor sold 300 July, and Goldenberg-Hehmeyer sold 200 May.

 

Commodity fund buying was estimated at 3,000 contracts.

 

Oat futures ended slightly higher to unchanged in quiet trade. May oats settled 1 cent higher at US$1.74 1/2 and July also ended up 1 cent at US$1.80 per bushel.

 

Ethanol futures settled mixed. The April contract gained 3 cents to US$2.58 per gallon, with the May contract unchanged at US$2.55.

 

On Thursday, the U.S. Department of Agriculture is scheduled to release the weekly export sales report for the week ending March 30. Analysts expect corn sales between 700,000-1,000,000 metric tonnes. Sales for the week ended March 23 totaled 1.145.8 million tonnes.