May 3, 2006

 

CBOT Corn Outlook on Wednesday: 1-2 cents higher on e-CBOT, precious metals

 

 

Corn futures at the Chicago Board of Trade are predicted to start Wednesday's open auction session 1 to 2 cents higher, following the firm tone in overnight trade and higher precious metals futures prices, sources said.

 

In overnight e-CBOT trading, July corn rose 1 1/2 cents to US$2.45 per bushel and December corn also gained 1 1/2 cents to US$2.68 1/2.

 

Corn was higher overnight and should be supported by stronger precious metals futures, with gold making a new 25-year high, a floor analyst said.

 

However, there is not much fresh news out this morning, so price direction could be dictated by what the funds want to do after Tuesday's price weakness, the analyst added.

 

The weather looks a drier near term but a little wetter next week, a commission house analyst said.

 

In the western U.S. Midwest, there is a chance for scattered thundershowers in southeast Iowa and in northern Missouri Wednesday with only a few light showers forecast in the remainder of the region, DTN Meteorologix Weather said. Mainly dry conditions are expected Thursday and Friday with temperatures averaging near to below normal Wednesday and below to well below normal Thursday and Friday, DTN Meteorologix Weather added.

 

In the eastern U.S. Midwest, there is a chance for scattered to widely scattered thunderstorms, with amounts .25-1.00 inch and locally heavier in the eastern Midwest during Wednesday and Thursday, DTN Meteorologix Weather said. Temperatures are expected to average above normal Wednesday but cooler Thursday and Friday, DTN Meteorologix Weather said.

 

Deliveries posted against the May contract totaled 2,693 contracts. Issuers included the customer account of E-Local, which issued 537 contracts, the customer account of JP Morgan, which issued 462 contracts, and the customer account of Bank of America, which issued 422 contracts.

 

Stoppers included the customer account of Dowd Wescott Group which stopped 381 contracts, the house account of O'Connor, which stopped 387 contracts, and the customer account of Fimat, which stopped 371 contracts.

 

On technical charts, July corn settled below its 10-day and 20-day moving averages and just above its 50-day moving average on Tuesday. In the last four sessions, July corn has traded in an 11 cent range, within US$2.40 1/4 to US$2.51 1/4.

 

The 14-day relative strength index for July corn stands at 47.35.

 

In other corn news, China's Dalian futures exchange remains closed this week for the Labor Day holiday. Trading will resume on May 8.