April 13, 2006

 

CBOT Corn Outlook on Thursday: Seen 1/2-1 cent lower on follow through

 

 

Corn futures at the Chicago Board of Trade are predicted to start open outcry trading 1/2 to 1 cent lower on follow through selling from Wednesday's weak close, sources said.

 

In addition, weaker prices in overnight trading and favorable weather conditions are also expected to weigh on the market, they added.

 

In overnight e-CBOT trading, May corn fell 1 1/2 cents to $2.47 1/4 per bushel, July ended down 1 1/2 cents at $2.67 3/4, and December also fell 1 1/2 cents at to $2.67 3/4.

 

Wednesday's poor technical close should weigh on the market to start with weaker prices overnight also adding pressure ahead of the long weekend, a market analyst said.

 

In addition, the weather continues to be favorable for early planting of the crop and there should be active planting in the southern US Midwest which should keep the market on the defensive, they added.

 

Position squaring ahead of the long weekend could keep prices within relatively modest ranges, a floor trader said.

 

The CBOT is closed on Friday for the Good Friday holiday.

 

Mainly dry conditions are forecast for the US western Midwest corn growing area for Friday and early Saturday, DTN Meteorlogix Weather said. A chance for showers or thundershowers is possible Saturday night into Sunday. Rainfall should average .10-.75 inch and locally heavier. Temperatures will average well above normal in the period, DTN Meteorlogix Weather said.

 

In the eastern US Midwest corn belt, scattered showers and thundershowers are predicted in northern and eastern sections of the US Midwest over the next several days, DTN Meteorlogix Weather said. Amounts should average .25-1.00 inch and locally heavier in these areas. Showers are expected to linger into Monday in Michigan, Indiana and Ohio on Sunday with mainly dry conditions on Monday. Temperatures are forecast to average much above normal early in the period, DTN Meteorlogix Weather noted.

 

The U.S. Department of Agriculture reported that weekly corn export sales totaled 922,400 metric tonnes for the week ended Apr. 6, within the range of analysts' estimates. Sales included 814,700 tonnes for delivery in 2005-06 and 107,700 tonnes for the 2006-07 crop year.

 

On technical charts, first resistance for July corn is seen at $2.50 and then at $2.53 1/4, Wednesday's high. First support is pegged at Wednesday's low of $2.48 1/4 and then at $2.46.

 

In other corn news, corn futures on China's Dalian futures exchange finished lower in range bound trading, an analyst said. The September contract ended RMB8 lower at RMB1,361/tonne.