April 20, 2006

 

CBOT Corn Review on Wednesday: Slips lower in choppy trade

 

 

Corn futures finished with modest losses Wednesday in choppy trade, with most months making new lows late in the session. Sharply higher outside markets, including silver, gold and crude oil, helped provide spillover support at the start, as did a weaker U.S. dollar, sources said.

 

May corn settled 3/4 cent lower at US$2.38 1/2 per bushel, July also fell 3/4 cent to US$2.50, and December slipped 1/4 cent to US$2.72.

 

Corn is holding around these levels as technically the market is unable to get through the highs set last week, said Brian Hoops, president of Midwest Marketing in Yanktonne, S.D. In addition, the forecasts are for drier weather, which should allow the corn planting pace to catch up to normal, he added.

 

Spillover from outside markets and fund buying helped provide some support, a floor analyst said. Fund buying was estimated at 4,500 contracts.

 

Weaker soymeal futures also limited buying interest, the analyst added.

 

In the western U.S. Midwest mostly dry weather is forecast for Friday and Saturday with a chance for showers to develop in western and southern locations on Sunday. Temperatures are expected to average near to above normal, DTN Meteorlogix Weather said.

 

In the eastern U.S. Midwest, mainly dry weather is forecast for the weekend after showers and some rain Thursday and Friday in the Delta and Ohio river valley. Rainfall should average .30-1.00 inch and locally heavier. Temperatures are expected to average near to below normal over the weekend, DTN Meteorlogix Weather said.

 

Buyers Wednesday included ABN Amro, which bought 2,000 July, Prudential Financial bought 2,000 July, JP Morgan bought 1,000 December and 900 July, ADM bought 500 May and Man Financial bought 500 December.

 

Sellers Wednesday included Man Financial, which sold 1,200 May, JP Morgan sold 1,000 July and 200 May, the Century division of Man Financial sold 400 May, Rand sold 300 December, Fimat sold 400 May and 500 July and FC Stonnee sold 400 July and 100 May.

 

Commodity fund buying was estimated at 4,500 contracts.

 

In options trading, Tenco bought 5,000 July 230 puts.

 

Oat futures ended near unchanged levels in light trading and within narrow price ranges as compared to this week's two previous sessions, sources said. The May contract ended unchanged at US$1.71 1/2 per bushel, July slipped 1/4 cent to US$1.77 1/2.

 

Ethanol futures settled mostly higher in thin trade. May ethanol finished 2 cents higher at US$2.76 per gallon, June did not trade and ended up 4 cents at US$2.76 1/2.

 

On Thursday, the U.S. Department of Agriculture is scheduled to release weekly export sales at 7:30 a.m. CDT. Analysts expect corn sales between 600,000-900,000 metric tonnes for the week ended April 13. Sales for the week ended April 6 were 922,400 tonnes.