April 23, 2007

 

CBOT Corn Outlook on Monday: 3-5 cents lower on planting progress, forecasts

 

 

Chicago Board of Trade corn futures are expected to begin day session trading 3-to-5 cents lower Monday on ideas that producers made good progress planting their crop this weekend in parts of the U.S. Midwest along with an improving weather outlook, a commission house analyst said.

 

In overnight electronic trading, May corn fell 5 cents to US$3.55 1/2 per bushel, July declined 5 cents to US$3.67 and December fell 4 3/4 cents to US$3.70. E-CBOT volume in July was 6,336 contracts.

 

Corn should open to the downside on ideas that producers made better-than-expected planting progress over the weekend as it appears that the rain expected was not as widespread as earlier predicted, a commission house analyst said.

 

Although rain is predicted for early this week, the 6-to-10 day weather outlook calls for warmer and drier weather which should allow farmers to plant their corn acres, a floor analyst added.

 

In the western U.S. Midwest, there is a chance for moderate-to-heavy rain with .50-2.00 inches and locally heavier amounts possible through central and southern locations Tuesday and Wednesday, DTN Meteorologix Weather said. Temperatures are expected to average near-to-below normal Tuesday and Wednesday.

 

In the eastern sections of the region, there is a chance for widespread rain and thunderstorms Tuesday evening into Wednesday, with rainfall averaging .75-to-2.50 inches during this period. Temperatures are expected to average near normal Tuesday and below normal Wednesday, Meteorologix Weather said.

 

In the 6-to-10 day outlook, temperatures are expected near-to-above normal with rainfall near-to-below normal.

 

On daily technical charts, July corn settled near the session low with trading expected to be choppy in the near term on weather concerns, a market technician said.

 

First support for July is seen at US$3.69 3/4 and then at US$3.63 1/2. First resistance is pegged at US$3.75 and then at US$3.78 3/4.

 

Large speculative traders reduced their long CBOT corn futures and options on futures positions by 18,130 contracts and added 6,417 contracts to their short positions and are now net long 137,655 contracts as of April 17, the CFTC reported Friday.

 

Large commercial traders went in the opposite direction, cutting their short positions by 21,360 contracts and adding 12,236 contracts to their long holdings and are now net short 408,701 futures and options on futures, the CFTC said.

 

In other corn news, Chinese corn exports totaled 1.1 million metric tonnes in March up 46% from March 2006. China's corn exports stood at 2.9 million metric tonnes in the January-March period, up 32.3% from last year at this time.

 

Corn futures on China's Dalian Futures Exchange ended lower with the September contract up RMB/3 at RMB1,643/tonne.

 

Argentina's 2006-07 corn export sales reached 10.055 million metric tonnes the country's Agricultural Secretariat reported Friday. Last year at this time, the country had sold 3.365 million tonnes of corn.

 

Monday, the U.S. Department of Agriculture is scheduled to release the weekly export inspections report at 11:00 a.m. EDT (1500 GMT) and the weekly crop progress report at 4:00 p.m. EDT (2000 GMT).