July 22, 2006

 

CBOT Corn Review on Friday: Lower on bearish weather forecasts

 

 

CBOT corn futures settled moderately lower Friday, as bearish Midwest weather forecasts and fund selling kept the market on the defensive, floor sources said.

 

September corn futures closed 5 1/4 cents lower at US$2.37 1/4 and December settled down 5 3/4 cents at US$2.53 1/2.

 

The session opened lower in tune with weaker prices overnight and mild Midwest weather forecasts. The market traded within narrow ranges, unable to establish any upside momentum, sources said.

 

The cool Midwest weather predictions that pressured the market on the opening were confirmed midday, continuing weight on the market, floor analysts said.

 

Weekend forecasts see dry weather and temperatures in the upper 70s to mid- to upper-80s, said Joel Burgio of DTN Meteorlogix. Early next week, temperatures will warm to the mid-80s to mid-90s and remain dry, he said.

 

Another front is expected to push through the Midwest Wednesday, with a chance of widely-scattered thundershowers, Burgio said, bringing 1/10 - 1/2 inch of rain late Tuesday and Wednesday.

 

"We could see further episodes of hotter weather as we get into next weekend," he said. The western corn belt, Burgio notes, could also see hotter temperatures without increased rainfall in the long-term.

 

Sellers Friday included Goldenberg-Hehmeyer, which sold 5,000 December, Man Financial sold 1,500 December, RJ O'Brien sold 1,000 December and Rand Financial sold 1,000 September.

 

Buyers Friday included FC Stonnee, which bought 1,500 December, Tenco bought 1,500 September, Fimat bought 500 December, RJ O'Brien bought 600 March, and the USA Trading division of Man Financial bought 500 March.

 

Fund selling was estimated at 8,500 contracts.

 

Oat futures settled lower, following corn futures with light fund selling adding to the negative tonnee, a floor trader said.

 

September oats declined 3 1/2 cents to US$1.89 3/4 per bushel while December also fell 3 1/2 cents to US$1.93 1/2.

 

Ethanol futures finished mixed Friday in light trading as the August contract fell 8 cents to US$2.80 per gallon and September remained unchanged at US$2.71.

 

On Monday, the U.S. Department is scheduled to release the weekly export inspections at 10:00 a.m. CDT, and at 3:00 p.m. CDT (2000 GMT), the weekly crop conditions report.