May 23, 2007
CBOT Corn Review on Tuesday: Settles lower on crop progress, speculative sales
Chicago Board of Trade corn futures ended with good-sized losses Tuesday, erasing Monday's advances as the USDA's bearishly construed crop progress report led to speculative selling, analysts said.
July corn fell 11 1/2 cents to US$3.69 1/2 per bushel, September settled 10 cents lower to US$3.71 1/4, and December declined 11 cents to US$3.69 1/4.
Monday's crop progress led to speculative technical selling that pressured the market, said Don Roose, president of US Commodities in West Des Moines, Iowa. In addition, the near-term weather forecast predicts moisture for parts of the U.S. Midwest that should be beneficial to most of the crop, Roose said.
Midday weather outlooks were in conflict and the uncertainty led to some speculators to exit positions, a commission house analyst said.
The inability of July and December to hold above moving averages that were recently pierced led to liquidation, the analyst said.
Fund selling was estimated at 6,000 contracts.
Market direction on Wednesday depends on the overnight weather forecasts, Roose said.
On daily open auction charts, July corn settled below its 40-day and 20-day moving averages, and finished right at its 10-day moving average. December finished beneath its 20-day and 10-day moving averages.
In open auction trades, Man Financial bought 1,000 December and Rand bought 1,000 December while Rosenthal sold 600 July.
Oat futures ended mixed as spillover weakness from the rest of the floor weighed on prices despite light fund buying, an analyst said.
If U.S. farmers can do such a good job of planting their corn crop, Canadian oat farmers can do it too, the analyst said. Canada is a major source for oats used in the U.S.
July oats fell 2 cents to US$2.69 1/4 per bushel while December ended unchanged at US$2.61.
Ethanol futures settled modestly lower in light trade. June ethanol settled 2.5 cents lower to 2.15 per gallon and July fell 1.2 cents to US$2.103.
