July 22, 2010

CBOT corn futures climb on wheat short covering

US corn futures climbed on Wednesday on support from a surging wheat market and technical short covering, traders and analysts said.

September corn ended up 5 3/4 cents to US$3.79 3/4 a bushel, and December corn closed up 6 cents to US$3.93 1/2. Despite the gains, the September contract is down 3.8% on the week.

The market climbed despite a lack of fresh bullish news, traders said. Traders and analysts mostly said the crop outlook remains good, although bulls point to reports of variability, with some areas too wet and others too dry for optimal yields.

The market lacks a clear weather threat in the forecast, however. Analysts said that while much of the corn belt will see a day or two of hot temperatures through the end of the week, beyond that temperatures will be more moderate.

In addition, analysts are expecting rains to miss some of the wettest areas of the western corn belt, hitting north of areas of Missouri, Iowa and west-Central Illinois that have been saturated. Traders said there was little fundamental support behind Wednesday's gains.

Traders also noted that the market had little or no support from crude oil and the dollar. Some traders said that after falling for a couple of days, the market was set for a technical bounce.