July 10, 2009

 

CBOT Corn Review on Thursday: Higher on exports, short-covering

 

 

Chicago Board of Trade corn futures ended higher on support from outside markets and short-covering ahead of Friday's USDA report, traders said.

 

July corn ended up 4 1/4 cents at US$3.43 1/2 per bushel. September corn ended up 4 1/4 cents at US$3.29 1/2, and December corn ended up 5 3/4 cents at US$3.40.

 

The market was "acutely oversold" after recent steep losses, and was due for a short-covering bounce, a trader said. The market had "had enough liquidation selling," an analyst added.

 

Strong weekly net-export sales reported Thursday supported the bounce, analysts said, as did outside markets. Soys posted strong gains, wheat was higher and the dollar was weaker, which boosted commodities in general.

 

The trade is awaiting Friday's supply-and-demand report, which is expected to show a steep climb in projected 2009-10 carryout, based on last month's bearish acreage report, which forecast far more corn plantings than expected. The U.S. Department of Agriculture will release Friday's report at 8:30 a.m. EDT (1230 GMT).

 

A trader said he expects the USDA will increase its yield projection for this year's crop by two bushels per acre. The large acreage, along with good crop conditions thanks to favorable weather, kept a lid on the market, traders said.

 

Weather remains benign, with ample rain and moderate temperatures, and the trade expects a large crop this year that will keep supplies at comfortable levels.

 

One trader did note, however, a more threatening weather outlook in the 11-to-15-day period, which could have given the market a little support.

 

Funds bought an estimated 5,000 contracts Thursday.

 

CBOT oats futures ended slightly higher. September oats ended up 2 cents at US$2.11 1/2 per bushel, and December oats settled up 2 cents at US$2.23 1/2.

 

Ethanol futures were higher. September ethanol ended up US$0.012 at US$1.478 per gallon, and December ethanol ended up US$0.018 at US$1.472.