April 9, 2009

 

CBOT Corn Review on Wednesday: Slight gain, support from weather

 

 

Chicago Board of Trade corn futures ended slightly higher Wednesday amid choppy trading as traders positioned themselves ahead of Thursday's supply and demand report.

 

May corn ended up 3/4 cent to US$3.97 per bushel and July corn ended up 1/4 cent to US$4.06 3/4.

 

Outside markets, including equities and crude oil, helped corn trade a few cents higher for much of the day. But those markets retreated, and technical selling erased most of corn's gains, a trader said.

 

The day of choppy trading was characterized by positioning ahead of the supply and demand report, which the U.S. Department of Agriculture will release at 8:30 a.m. EDT. The trade is not expecting any big news from the report, but traders weren't taking chances, analysts said.

 

Corn had support from soybeans, which posted solid gains on the day, an analyst said.

 

"I think the corn is a little bit of a follower at this point, behind the beans," says Dale Durchholz, analyst with AgriVisor.

 

U.S. corn belt weather was considered as an underlying supportive factor, although the trade's opinions on this matter are varied.

 

"Everybody continues to look at the weather forecasts and see two, three storms still coming at them," said Jerry Gidel, analyst for North America Risk Management Services.

 

Durchholz said that some traders have focused on 6- to 10-day forecasts calling for cold, wet weather to continue in the Midwest, while others have keyed in on longer-range forecasts calling for a warm-up.

 

Barring any surprises in the report, the trade will put an increased focus on the weather, analysts said.

 

Analysts on average project the USDA will peg 2008-09 corn ending stocks at 1.731 billion bushels, down slightly from a March projection of 1.740 billion. Ending stocks for 2007-08 were 1.624 billion bushels.

 

Funds bought an estimated 1,000 contracts Wednesday.

 

CBOT oats futures ended lower. May oats were down 2 cents to US$1.97 per bushel and July oats ended down 2 1/4 cents to US$2.06.

 

Ethanol futures were slightly higher. May ethanol ended up US$0.005 to US$1.575 per gallon and June ethanol settled up US$0.008 to US$1.590.