April 7, 2009

 

CBOT Corn Review on Monday: Eeks out small gain on planting concerns

 

 

Concerns about early planting in U.S. corn belt pushed corn to a slightly higher close Monday.

 

May corn ended up 1 cent to US$4.05 1/2 per bushel, July corn ended up 1 cent to US$4.15 3/4, and December corn was up 1 1/4 cents to US$4.36 3/4.

 

Weekend snowfall across much of the Midwest and the prospect of more cold, wet weather through the middle of the month has prompted talk of early planting delays in the U.S. corn belt, analysts said.

 

Vic Lespinasse, analyst with grainanalyst.com, said the concern among some traders is that the weather will prompt some producers to switch some of their corn acres to soybeans. That fear, he noted, helped push December corn slightly higher while November soybeans fell more than a dime.

 

But corn and other agricultural commodities faced stiff resistance from outside markets, analysts said.

 

"They wanted to go up, and they would have, but the outside markets gave them grief," Lespinasse said.

 

Weaker crude oil weighed on corn because of both market's ties to ethanol. Meanwhile a drop in equities highlighted concerns about the global economy, and continuing weak demand, some analysts said.

 

Along with the outside markets, farmer selling helped limit corn's gain, a trader said. Producers have held on to grain much longer than normal this season and would like to get rid of it before beginning planting, analysts say. They have been more willing to sell with prices above US$4.

 

The trader said that the shaky economy is set to put increased pressure on agricultural commodities despite recent gains.

 

"If you look at outside markets, I still think it's a sucker's rally," the trader said.

 

Corn was supported by strong export inspections, analysts said. The USDA reported weekly inspections of 42.290 million bushels, up from 37.527 million the previous week and well above analyst expectations.

 

Funds bought an estimated 1,000 contracts.

 

CBOT oats futures ended slightly higher. May oats ended up 1 cent to US$2.00 per bushel and July oats ended up 3/4 cent to US$2.09 1/4. Other contract months settled unchanged.

 

Ethanol futures ended lower. May ethanol ended down US$0.010 to US$1.588 per gallon and June ethanol ended down US$0.017 to US$1.618.