May 2, 2007

 

CBOT Corn Outlook on Wednesday: 2-3 cents higher on weather, firm e-CBOT trade

 

 

Chicago Board of Trade corn futures are predicted to begin trading 2-to-3 cents higher Wednesday as concerns about the near-term planting weather and firm prices in overnight trading are expected to support prices, a floor trader said.

 

In overnight electronic trading, May corn rose 2 1/2 cents to US$3.70 per bushel, July gained 3 1/4 cents to US$3.80 3/4 and December rose 3 1/2 cents to US$3.82. E-CBOT volume in July was 6,551 contracts.

 

The weather remains the key and should be supportive to prices, a floor analyst said. The concern is that the wet weather will keep farmers from finishing planting by mid-May and that could impact optimum yields, the floor analyst said. In addition, the closer the calendar gets to the middle of te month the more some producers will switch to planting soybeans, the analyst said.

 

Trading should be choppy as the market reacts to updated weather forecasts during the session, a commission house analyst said.

 

In the western U.S. Midwest, mainly dry weather is forecast Thursday except in Missouri with possible light thundershowers on Friday, DTN Meteorologix Weather said. Temperatures are expected to average above normal in the period.

 

In the eastern sections of the region, scattered showers and possible thundershowers are forecast for Thursday in southern sections of the region, with light showers possible elsewhere in the region, Meteorologix Weather said. There is a chance for light to moderate showers north and west on Friday. Temperatures are forecast to average near-to-above normal in the period.

 

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

 

Deliveries posted against the May future were 1,264 contracts. Large issuers included the customer account of Rosenthal Collins which issued 865 contracts and the customer account of FC Stone which issued 295 contracts. Large stoppers included the customer account of Iowa Grain, which stopped 289 contracts, the customer account of Fortis which stopped 394 contracts, and the house account of Tenco, which stopped 282 contracts. The last trade assigned was April 26.

 

On daily technical charts, July corn closed near the session high Tuesday and trading is expected to be choppy as farmers plant their corn crop, a market technician said.

 

First resistance for July is seen at US$3.80 and then at US$3.82 1/2. First support is seen at US$3.75 and then at US$3.72 1/2.

 

In other corn news, prices of corn delivered to Asia may continue to increase this week, following the increase in CBOT corn prices, analysts said.

 

Corn futures trading in China was closed due to the May Day holiday.