April 21, 2006

 

CBOT Corn Review on Thursday: Ends lower on outside-market influence

 

 

Chicago Board of Trade corn futures settled lower Thursday, unable to recover from steep losses in outside markets early in the session, floor sources said.

 

Plunging silver and gold along with sharply lower crude oil futures pushed prices lower early, they added.

 

May corn settled 2 3/4 cents lower at US$2.35 3/4 per bushel, July fell 2 1/2 cents to US$2.47 1/2, and December also fell 2 1/2 cents to US$2.69 1/2.

 

The outside markets were the feature today, said Vic Lespinasse of AG Edwards & Sons. They "came back from the dead" around mid-day after suffering steep losses, and corn stabilized, he added.

 

Fund and technical selling added to the early losses but futures were able to hold above the upside price gap created in late March on daily price charts, a floor analyst said. In addition, light commercial buying helped corn recover, with additional strength coming from rebounding soy and wheat futures values, he added.

 

However, the inability of soybeans and wheat to maintain those gains led to renewed selling interest late, the analyst noted. The fundametals didn't matter on Thursday.

 

"Export sales were decent and the forecast looked like it got a little wetter, but the outside markets overrode the fundamentals," he said.

 

The U.S. Department of Agriculture reported U.S. weekly export sales were 1,103.1 million metric tonnes for the week ended April 13 above analysts' expectations of 600,000-900,000 tonnes.

 

Mainly dry weather is forecast in the western U.S. Midwest Friday and Saturday before light or locally moderate showers are predicted in sections of the region on Sunday and into Monday, DTN Meteorlogix Weather said. In the 6-to-10 day outlook, precipitation is expected near to below normal and temperatures to average near to above normal.

 

In the eastern U.S. Midwest, drier weather will return to the Delta on Sunday, before a chance for showers to develop in the eastern Midwest and the Delta on Monday, DTN Meteorlogix Weather said.

 

In the 6-to-10 day outlook, precipitation is forecast near to above normal in the southern sections of the eastern Midwest into the Delta, with near- to below-normal precipitation farther north, DTN Meteorlogix Weather noted.

 

Buyers Thursday included UBS, which bought 2,000 July and 300 May. ADM bought 1,000 May, Citigroup bought 800 May and 400 September, JP Morgan bought 1,000 May, RJ O'Brien bought 600 May and 300 December, Bunge bought 400 May, and Fimat bought 500 May and 200 July.

 

Sellers Thursday included ABN Amro, which sold 1,00 July. Citigroup sold 1,000 December, JP Morgan sold 2,000 July, Man Financial sold 1,000 July and 600 May, Fortis sold 500 May, the Refco division of Man Financial sold 2,200 May and 200 July, and the Century Group division of Man Financial sold 500 May.

 

Commodity fund selling was estimated at 7,500 contracts.

 

Oat futures settled mixed as outside markets and spillover weakness weighed on futures before oats staged a light recovery, floor sources said.

 

The May contract settled 1/2 cent higher at US$1.72 per bushel, and July ended unchanged at US$1.77 1/2.

 

Ethanol futures ended lower in light trade. May ethanol fell 3 cents to US$2.73 per gallon, June did not trade and declined 4 cents to US$2.72 1/2.