July 21, 2009

 

CBOT Corn Review on Monday: Ends up on dollar; weather limits gains

 

 

Chicago Board of Trade corn futures ended higher Monday on support from a weaker dollar and gains in other markets, analysts said.

 

September corn ended up 1 cent to US$3.23 1/4 per bushel and December corn ended up 2 1/4 cents to US$3.33 3/4.

 

The market opened higher but soon retreated in early trade before inching higher later in the day. A break in the dollar helped prompt gains in other commodities, including crude oil, which was supportive to corn, as well as soys.

 

"The money flow was reflecting desire for risk," said Arlan Suderman, analyst for Farm Futures.

 

Jeff Hainline, director of Advance Trading, said that farmers' unwillingness to sell due to the recent break in prices has been supportive. Analysts also note that export demand has been solid, with sales to Egypt and Mexico announced Monday.

 

The USDA said Monday that weekly grain inspections for export totaled 36.821 million bushels, down from 38.832 million the previous week. Analysts had expected between 35 and 41 million.

 

Hainline added that end-users might have added support.

 

"Ethanol margins went up quite a bit last week, so maybe we're getting a little buy-in there," Hainline said.

 

Weather remains benign, although market bulls say the absence of heat in the Midwest could become a concern. The crop looks good but remains behind schedule and needs "heat units," traders said.

 

The trade is expecting a slight drop of 1 to 2 percentage points in the portion of the crop rated good to excellent in Monday's crop progress report, which the USDA will release at 4 p.m. EDT.

 

Corn lacks direction, some traders said, and could follow wheat and soy movement. One trader said corn could move sideways until the August USDA crop report.

 

Funds bought an estimated 4,000 contracts Monday.

 

CBOT oats futures ended slightly lower in light trade. September oats ended down 3/4 cent ' US$2.16 per bushel and December oats ended down 3/4 cents ' US$2.28.

 

Ethanol futures were higher. August ethanol was up US$0.026 ' US$1.560 per gallon and September ethanol ended up US$0.024 ' US$1.534.