August 21, 2007

 

CBOT Corn Review on Monday: Bounces higher commercial, technical buys

 

 

Chicago Board of Trade corn futures ended higher Monday, recovering from early weakness on commercial buying and technical support, analysts said.

 

September corn ended 3 1/4 cents higher at US$3.31 3/4, and December finished 3 cents higher at US$3.48 3/4.

 

A decent amount of end user buying served as the catalyst that sparked corn recovery, an analyst said.

 

Friendly technical chart patterns, following the December contract's ability to bounce off support in the US$3.20 area last week, attracted buyers as well, traders said.

 

Solid underlying export demand remains an underpinning feature, with decent export inspections providing a positive feature in an otherwise quiet news front, a trader added.

 

Futures were on the defensive for most of the day, succumbing to early spillover weakness from wheat and soybeans, as the market did view rainy Midwest conditions making any aggressive impact of corn yields at this point, analysts added.

 

The DTN Meteorlogix weather forecast sees an area of the Midwest - mostly north of a line from southeastern Nebraska to the Ohio Valley - in an active weather pattern, with rainfall chances of up to one and one-half inches, with locally heavier amounts.

 

Rainfall in the driest areas of the southern Midwest - from southeastern Missouri through western Kentucky - will provide some relief from this month's heat wave. The moisture fueling this rainfall opportunity is the result of the remnants from last week's Tropical Storm Erin weather system. This rainfall will not be a week-long event, but it will be important in terms of the timing of rains following two weeks of very hot and stressful crop weather, Meteorlogix forecasts.

 

In pit trades, buyers and sellers were lightly scattered among various commission houses.

 

In other news, the Pro Farmer Midwest Crop Tour kicked off Monday morning, with reports of variable conditions found by crop scouts touring fields in the eastern and western Midwest.

 

U.S. Department of Agriculture reported 38.644 million bushels of corn were inspected for export in the week ended Aug. 16. The export figure is down 13.8% from the previous week's 44.819 million bushels. Analysts surveyed by Dow Jones Newswires projected the inspections to fall within a range of 34 million to 43 million. Accumulated corn inspections total 1.967 billion bushels, down 0.5% from the 1.977 million bushels reported at the same time last year.

 

USDA is scheduled to release its weekly crop progress report at 4 p.m. EDT. Analysts anticipate crop ratings to stabilize after recent rain events across the belt.

 

CBOT oat futures closed in negative territory on harvest pressure and a lack of fresh news, a floor broker said. Trading was thin. September closed 2 1/2 cents lower at US$2.43 per bushel, and December settled down 3 1/4 cents at US$2.50 1/4.

 

Ethanol futures finished weaker. September ended 0.083 cent lower at US$1.729 per gallon, and October fell 0.055 cent to US$1.675.