May 15, 2007

 

CBOT Corn Review on Monday: Settles down on profit-taking, planting pace

 

 

Chicago Board of Trade corn futures ended lower Monday, backpedaling off Friday's strong gains on profit taking amid strong weekend planting progress, analysts said.

 

July corn ended 6 cents lower at US$3.63 1/4, and December finished 3 1/2 cents lower at US$3.71. Favorable weekend weather conditions were seen promoting a rapid planting pace across the central U.S., as farmers aggressively returned to fieldwork after recent rains had idled planting progress earlier in the week in the western Midwest, analyst said.

 

However, spillover support from soybeans, uncertainty of the 2007 crop with crusting issues surfacing and a strong technical close from Friday promoted two-sided action during the day, a trader added.

 

Nevertheless, soybean/corn spreading and speculative fund selling remained driving forces to press prices into negative territory, analysts added.

 

Meanwhile, analysts say the market was briefly put on pause as traders look ahead to Monday afternoon's weekly crop progress report from the U.S. Department of Agriculture.

 

The USDA is scheduled to release its progress report 4 p.m. EDT. Analysts anticipate planting progress in the 70%-75% range. The DTN Meteorlogix Weather Service forecast calls for a band of showers and thunderstorms to cross the Midwest from north to south. This shower pattern will bring up to one inch of rain to the western Midwest, and up to three-quarters of an inch precipitation to the eastern Midwest. Following a weekend of very warm and dry weather in the Corn Belt, these showers will be beneficial for germination and early growth of crops.

 

There will be some chilly weather by the end of this week in the Great Lakes vicinity, with some possible light frost. The six- to 10-day outlook for the Midwest has a promising round of rainfall in its depiction. The outlook is for normal to above-normal temperatures and precipitation. If this outlook remains steady, it would be beneficial for early-season rainfall for crop emergence and growth, Meteorlogix reports.

 

In pit trades, buyers were lightly scattered among various commission houses. On the sell side, ADM Investor Services sold 600 December, Tenco sold 700 December, Fortis sold 400 July, Man Financial sold 300 July, and UBS Securities sold 1,000 December. Speculative fund selling was estimated near 3,000 lots.

 

Oat futures settled mostly higher in lackluster trade, supported by light speculative buying, a floor trader said. July oats rose 1/4 cent to US$2.56 per bushel, while December slipped 1/4 cent to US$2.49 1/2.

 

Ethanol futures ended firmer. June ethanol settled 0.039 cents higher at US$2.165 per gallon, and July ended unchanged at US$2.105.