July 10, 2007

 

CBOT Corn Review on Monday: Ends lower but trims early declines

 

 

Chicago Board of Trade corn futures settled lower in quiet, two-sided trade with the exception of the distant deferred contracts, staging a recovery from moderate declines set early in the session.

 

July corn declined 2 cents to US$3.32 1/2 per bushel, September fell 2 1/4 cents to US$3.39 1/4, and December slipped 1 3/4 cents to US$3.50 1/4.

 

Follow-through weakness from the overnight session and weather forecasts predicting showers and cooler temperatures in much of the U.S. Midwest by midweek pressured prices early, an analyst said.

 

Some midday weather forecasts trimmed their predictions on the amount of rain expected this week and corn stabilized at lower levels, the analyst added.

 

A rally in soybean futures to new contract highs helped the deferred back-month corn contracts firm and the midday radar showed few showers in the region leading nearby futures to stage a modest recovery, a trader said.

 

The midday forecasts were a bit drier, but overall, the weather is favorable to corn development, a commission house analyst said. "Corn has divorced itself from soybeans for the present," he added.

 

Light speculative selling also added modest pressure with fund selling estimated at 4,000 contracts.

 

Weekly export inspections were released during the session and were below expectations but had little impact, an analyst said. The U.S. Department of Agriculture reported corn inspected for export totaled 22.4 million bushels for the week ended July 5, well below the 32 million - 42 million expected and the 38.6 million inspected the previous week.

 

The weekly crop progress report is due out this afternoon and that, as well as the overnight weather forecast, could influence corn price direction on Tuesday, a trader said.

 

Crop conditions are expected to decline by 1-to-3 percentage points from last week's 73% good-to-excellent rating.

 

In open auction trading, Kottke bought 1,000 December and JP Morgan bought 800 December, while UBS sold 1,500 December.

 

In options trading, Rand bought 4,000 December US$4.00 calls and sold 1,000 December US$3.20 calls. ADM bought 1,000 December US$4.40 calls and bought 1,000 December US$4.60 calls and sold 3,000 September US$4.00 puts.

 

Oat futures settled unchanged to lower in thin trade as the weakness in wheat weighed on oats, a floor trader said. July oats ended unchanged at US$2.84 per bushel and December fell 2 1/2 cents to US$2.68 1/2.

 

Ethanol futures ended slightly lower in modest activity. August ethanol fell 2.4 cents to US$1.939 per gallon and September slipped .004 cent to US$1.901.

 

Monday afternoon, the Commodity Futures Trading Commission is scheduled to release the weekly commitment of traders' data for the period ending July 3. The report was delayed a day due to the holiday. The USDA is scheduled to release the weekly crop progress report at 4:00 p.m. EDT (2000 GMT).