June 9, 2007

 

CBOT Corn Review on Friday: Settles lower in two-sided session

 

 

Chicago Board of Trade corn futures ended with modest losses Friday but well above earlier levels in choppy trading, analysts said.

 

July corn settled 2 3/4 cents lower to US$3.82 per bushel, September fell 3 1/4 cents to US$3.90 1/4, and December slipped 1 1/4 cents to US$3.92 1/4.

 

Bearish overnight weather forecasts and a general commodity wide sell-off pressured prices at the start of daytime trading, an analyst said.

 

Profit taking after large gains set Thursday also added to the weakness as did losses in soybeans, said Jason Britt, an analyst with Central States Commodities in Kansas City.

 

However, midday weather forecasts that decreased the amount of rain forecast for next week in the U.S. Midwest and the development of a ridge later next week helped corn rally from moderate losses, a trader said.

 

The market was nervous ahead of Monday's U.S. Department of Agriculture's supply and demand reports with some people concerned that the government might increase its corn yield estimate based on favorable crop conditions, Britt said.

 

An average of 18 analysts surveyed by Dow Jones expects 2006-07 corn ending stocks at 947 million bushels, 10 million bushels above the USDA's 937 million bushel estimate in May.

 

The average ending stocks estimate for the 2007-08 crop year was 997 million bushels, 50 million bushels above the 947 million estimated in May.

 

The report is scheduled for release Monday at 8:30 a.m. EDT.

 

Price direction will depend on the Sunday night weather forecast unless the report is a "shocker," an analyst said.

 

After being noted as early sellers, commodity funds ended the session flat.

 

In options trading, Tenco bought 1,500 August US$4.20 calls and sold 1,500 August US$4.80 calls.

 

Oat futures ended weaker in modest trade as spillover weakness from corn limited buying interest, a floor trader said. Commercials were noted selling July and September and buying December, he said.

 

July oats settled 1 1/2 cents lower to US$2.92 per bushel and December fell 1 3/4 cents to US$2.82.

 

Ethanol futures settled lower in light trade. July ethanol declined 6.5 cents to US$1.92 per gallon and August slid 4 cents to US$1.91.

 

Friday afternoon the Commodity Futures Trading Commission is scheduled to release the commitment of traders report for the period ended June 5.

 

On Monday in addition to the supply and demand report, the USDA is scheduled to release the weekly export inspections report at 11:00 a.m. EDT and the weekly crop progress report at 4:00 p.m. EDT (2000 GMT).