April 28, 2007

 

CBOT Corn Review on Friday: Ends lower; new crop leads declines

 

 

Chicago Board of Trade corn futures ended lower Friday, with the nearby months recovering from earlier losses to finish modestly lower while the new-crop months settled near their lows of the session.

 

May corn declined 1/2 cent to US$3.64 1/4 per bushel, July fell 1 1/2 cents to US$3.73 3/4 and December settled 6 1/2 cents lower at US$3.67 1/2.

 

Late bull market spreading helped underpin the nearby futures and weigh on the deferred months, a floor analyst said.

 

Short covering in May also helped trim the losses as participants exited out of their May positions, the analyst said. Monday is first notice day for the May future.

 

Midday weather forecasts which predicted slightly drier weather for late next week than previous forecasts also weighed on new crop contracts.

 

The weather appears to be more favorable to corn planting next week, but the question is how many corn acres can be planted after the recent heavy rain in much of the U.S. Midwest, a commission house analyst said.

 

Speculative selling thought to be fund related also pushed prices lower, a floor trader said. Fund selling was estimated at 9,000 contracts.

 

Monday's price direction will be influenced by the weekend weather forecasts, the amount of corn delivered against the May contract and the market's interpretation of planting progress, if any, over the weekend, the commission house analyst said.

 

On daily open auction technical charts, July futures settled right at their 10-day and 20-day moving averages.

 

In open auction trading, buyers included JP Morgan, which bought 500 July, and Man Financial, which bought 2,000 July.

 

Sellers included JP Morgan, which sold 1,500 July and 1,000 December, and Fimat, which sold 1,000 July.

 

In options trading, JP Morgan sold 1,000 July US$4.00 calls and Tenco bought 500 December US$5.00 calls and sold 500 December US$3.60 puts.

 

Oat futures ended with modest gains in light trading, with fund buying in July providing support to prices, a floor trader said.

 

May oats settled 1 1/2 cents higher to US$2.65 per bushel and July gained 4 1/2 cents at US$2.69 1/2.

 

Ethanol futures settled mostly higher in very light activity, with the May contract down 2.9 cents to US$2.161 per gallon. June ethanol settled 2 cents higher at US$2.18.

 

Friday afternoon, the Commodity Futures Trading Commission is scheduled to release the commitment of traders report for the period ending April 24.

 

Monday is first notice day for May futures, with analysts expecting deliveries of 0-1,200 contracts.

 

Monday afternoon, the U.S. Department of Agriculture is scheduled to release the weekly crop progress report for the week ending April 29 at 4 p.m. EDT (2000 GMT).