April 28, 2006

 

CBOT Corn Review on Thursday: Mostly lower but rebounds from lows

 

 

Corn futures settled mostly lower Thursday but late short covering helped futures rebound from earlier losses, floor traders said. The pit got short and there was nothing for sale late, so they had to cover, a commission house trader said.

 

May corn fell 1/4 cent to US$2.31 1/4 per bushel, July fell 1/2 cent to US$2.42 3/4, and December slipped 1/4 cent to US$2.66. New crop months from March 2007 out ended at unchanged levels.

 

Spillover weakness from overnight trade and news that China had raised interest rates weighed on futures initially, sources said.

 

The China interest rate news had a slightly negative impact early in the session, said Vic Lespinasse of A.G. Edwards & Sons.

 

Export sales of 782,400 metric tonnes for the 2005-06 marketing year were "lackluster," he added.

 

Technical selling added to the early declines before light buying near the US$2.40 level in July, helped to trim the losses, a floor analyst said.

 

Fund buying, thought to be index funds, emerged in December and trimmed the losses, as well he added.

 

Additional support came from wetter near-term weather forecasts, possibly delaying corn planting, a floor analyst said.

 

Rainfall of up to two inches, with locally heavier amounts is forecast from the Mississippi Valley across Iowa, parts of Missouri, eastern Nebraska and southern Minnesota, is forecast for Friday and Saturday, DTN Meteorlogix Weather said.

 

In the eastern US Midwest, there is a chance for showers and possible thunderstorms in western and southern locations during Saturday with rainfall in these areas averaging .25-1.00 inch, DTN Meteorlogix Weather said.

 

Buyers Thursday included JP Morgan, which bought 6,000 December, Fimat bought 700 May and 700 July, Goldenberg-Hehmeyer bought 1,000 December, and ADM bought 500 July.

 

Sellers Thursday included ABN Amro, which sold 1,500 July, ADM sold 400 July, Tenco sold 1,000 December, Man Financial sold 1,100 July, and JP Morgan sold 600 July and 200 May.

 

In spread trading, Fimat spread 4,000 September-July.

 

In option trades, Rand Financial bought 2,000 July US$2.50 calls

 

Commodity fund buying was estimated at 2,100 contracts.

 

Oat futures settled mixed in modest trading after recent strength. The July contract fell 1 cent to US$1.84 3/4 per bushel.

 

Ethanol futures settled lower with the May contract declining 2 cents to US$2.62 per gallon.

 

Friday is first notice day for May corn futures. Traders and analysts expect corn deliveries between 1,500 and 2,100 contracts.