August 1, 2007

 

CBOT Corn Review on Tuesday: Ends higher; late buying interest supports

 

 

Chicago Board of Trade corn futures ended with modest gains and near session highs in light, choppy trade Tuesday as late speculative buying and position squaring helped supply support to prices, a floor trader said.

 

Sep corn rose 2 3/4 cents to US$3.25 3/4, Dec rose 2 1/4 cents to US$3.42 1/4 and Mar also gained 2 1/4 cents to US$3.57 1/2.

 

Corn is stuck right here, an analyst said. The current weather forecast is not that detrimental to the crop, so there is not much reason to buy it, but the rally in soybeans made it pretty tough to sell it, the analyst said.

 

Midday near-term weather forecasts were unchanged from earlier outlooks, with longer-term forecasts predicting an increased chance for rain next week with cooler temperatures possible, meteorological firm T-storm Weather said.

 

Corn is a crop made in July, not August, and with the exception of some areas of concern, it has the potential to be a 13 billion bushel crop, the analyst said.

 

Although Monday's crop progress figures were slightly weaker than expected, it didn't have much of an impact as it doesn't indicate any significant yield losses, a commission house analyst said.

 

The U.S. Department of Agriculture reported that 58% of the U.S. corn crop was in good-to-excellent condition as of July 29, down four percentage points from the previous week. Conditions in Iowa fell three percentage points in the good-to-excellent category while Illinois also reported a three percentage point decline in that category. Iowa and Illinois are the two largest U.S. corn-producing states.

 

Wednesday's price direction will depend on the overnight weather forecasts as well as whether the late rally seen Tuesday continues, an analyst said.

 

In open auction trading, Tenco bought 1,000 September and Rand bought 1,000 December.

 

Commodity fund buying was estimated at 2,000 contracts.

 

In options trading, FC Stonnee sold 1,000 September US$3.40 calls and JP Morgan sold 600 September US$3.25 calls and 600 September US$3.25 puts.

 

Oat futures settled higher as late spec buying, thought to be fund related, helped reverse early weakness, an analyst said.

 

September gained 3 3/4 cents to US$2.61 1/4 per bushel December rose 5 1/4 cents to US$2.71 3/4, and March settled up 4 1/2 cents to US$2.77.

 

Ethanol futures finished mostly higher in modest trade. August ethanol gained 6.2 cents to US$1.987 per gallon and September rose 1.2 cents to US$1.864.