September 18, 2007

 

CBOT Corn Review on Monday: Settles higher as commodities rally

 

 

Chicago Board of Trade corn futures settled with modest gains Monday in light trade as spillover support from a commodity-wide rally helped support corn futures, analysts said.

 

December settled 3 1/4 cents higher to US$3.52 1/4, March rose 3 cents to US$3.69 and May gained 3 1/2 cents to US$3.79 3/4.

 

"Corn followed the rest of the commodity world higher," said Joe Bedore, floor manager at FC Stonnee.

 

Soybeans and wheat both settled with good-sized gains and energy and metals futures also posted strong gains. December wheat traded limit-up late in the day and settled 29 cents higher at US$8.75. November soybeans gained 13 3/4 cents to US$9.68 1/2. Spot-month crude oil futures settled at another all time record, up US$1.47 at 80.57 per bushel.

 

Despite the gains, "Corn can't get away from the fact that the U.S. is going to produce a record corn crop this year and it's not going away, a trader said. "The market's focus is now moving towards demand rather than supply," said Bedore.

 

Export inspections were released during the session and were below analysts estimates. The U.S. Department of Agriculture reported that 30.856 million bushels were inspected for the week ended Sept. 13, below the 33 million to 43 million bushels expected by analysts and the 48.246 million inspected last week.

 

Price direction Tuesday depends on the amount of corn harvested with analysts expecting 11%-14% of the U.S. crop combined, an E-CBOT trader said. The overnight price direction of soybeans and wheat will also help determine corn prices, the trader said.

 

On daily technical charts, electronically traded December corn settled above most major moving averages but remained within its recent trading range.

 

In open auction trading, Fimat bought 700 December and Penson GHCO sold 2,000 December. Open auction commodity fund buying was estimated at 4,000 contracts.

 

In options trading, MF Global bought 4,000 November US$3.30 puts, and sold 2,000 December US$4.00 calls. JP Morgan bought 5,000 December 5.00 calls.

 

Oat futures ended with thin gains, unable to build on light speculative buying as weather in Canada, a major supplier of oats to the U.S. is improving amid ideas that Canada will have a good oat crop, an analyst said.

 

December oats gained 1 3/4 cents to US$2.82 1/2 per bushel and March settled 1 1/2 cents higher to US$2.91 1/2.

 

Ethanol futures settled flat to modestly higher. October ethanol settled 0.007 cent higher to US$1.615 per gallon and November ended unchanged at US$1.60.

 

Monday afternoon, the U.S. Department of Agriculture is scheduled to release the weekly crop progress report at 4:00 p.m. EDT. Analysts expect 11%-14% of the U.S. crop combined for the week ending Sept. 16.