June 2, 2007

 

CBOT Corn Review on Friday: Settles lower on profit taking

 

 

Chicago Board of Trade corn futures ended lower Friday, unable to improve upon Thursday's gains as light profit-taking ahead of the weekend and the lack of speculative buying limited the upside, analysts said.

 

July corn settled 3 1/2 cents lower to US$3.86 3/4 per bushel, Sep fell 2 1/4 cents to US$3.89 1/4, and Dec slipped 1 3/4 cents to US$3.83.

 

Most midday weather forecasts were little changed from earlier outlooks which indicated more favorable growing weather, limiting speculative buying late, a commission house analyst said.

 

The failure to take out Thursday's highs led to some light technical selling with profit taking adding to the weaker tone, said Clark Neighbors, an analyst with Bump Investor Services.

 

July corn ended the week over 20 cents above Tuesday's closing level.

 

The weakness was limited by good-sized gains in soybeans and soybean meal as well as a firm tone in wheat futures, a floor trader said.

 

"Corn was the laggard Friday in the grains," said Joe Bedore, floor manager at FC Stone.

 

The unwinding of bull spreads pressed the nearby contracts on talk of increased cash corn sales, a commercial analyst said. In addition, export sales were in line with expectations and had little impact, the analyst added.

 

The U.S. Department of Agriculture reported that corn export sales for the week ended May 24 were 1,365.6 million metric tonnes, within the range of analyst estimates. From the total, 689,500 tonnes was for delivery in the 2007-08 marketing year.

 

Price direction on Monday will depend on the rainfall received over the weekend in the eastern U.S. Midwest as well as the Sunday night weather forecasts, a trader said.

 

Fund buying was estimated at 2,000 contracts.

 

On daily technical charts, July traded an inside day, within the range established in Thursday's session.

 

In open auction trades Tenco bought 1,000 July, and Penson GHCO sold 1,200 December.

 

In options trading JP Morgan sold 500 July US$4.00 calls, 2,500 July US$4.40 calls and 1,000 December US$4.50 calls.

 

Oat futures settled higher as active fund buying helped prices rally, a floor trader said. The September, December and March open auction contracts all made new life of contract highs.

 

July oats gained 5 cents to US$2.86 per bushel and December also rose 5 cents to US$2.78.

 

Ethanol futures ended mixed in thin trade. June ethanol slipped 2 cents to US$2.17 per gallon and July fell .009 cent to US$2.041.

 

Friday afternoon, the Commodity Futures Trading Commission is scheduled to release the commitment of traders report for the period ending May 29. On Monday, the USDA is scheduled to release the weekly export inspections report at 1100 EDT and the weekly crop progress report at 1600 EDT (2000 GMT).