September 18, 2009

 

CBOT Corn Review on Thursday: Ends lower on benign weather

 

 

Chicago Board of Trade corn futures ended lower Thursday as the market continued to bleed weather premium amid a frost-free outlook for next week.

 

December corn ended down 7 1/4 cents to US$3.29 per bushel, and March corn ended down 7 1/4 cents to US$3.42 1/4.

 

Forecasts showed no frost in the corn belt next week for the second straight day. The frost threat had been the catalyst for a nearly 30-cent climb on Tuesday.

 

"The air in the tire deflated in corn yesterday, and it's never really been able to re-inflate here," said Mike Zuzolo, analyst with Global Commodity Analytics and Consulting.

 

Without frost damage, the crop is widely expected to make a run at U.S. production records. But the crop needs more time than normal this year because it was planted late and maturity is lagging.

 

"While the threat has not been fully eradicated, the chance of a widespread frost in the upper Midwest is minimal through the balance of the month," Farm Futures analyst Arlan Suderman said in a commentary.

 

A couple of traders and analysts also noted talk that China was going to export 2 million metric tonnes of corn, a development that would be bearish for the U.S. market.

 

"It's not the quantity, it's the principle of the thing," said John Kleist, broker/analyst for Allendale.

 

Kleist also noted that South Korea's Nonghyup Feed has passed on a tender issued Wednesday for 110,000 metric tonnes of U.S.-origin corn, a company official said Thursday, citing high costs and expectations prices could ease.

 

Analysts said the close was somewhat constructive, as December corn held above Tuesday's low of US$3.22 1/2. On the other hand, the market did end below its 40- and 50-day moving averages.

 

Funds sold an estimated 7,000 contracts.

 

CBOT oats futures ended lower Thursday. September oats ended down 3 1/4 cents to US$2.14 per bushel, and December oats ended down 3 1/4 cents to US$2.27.

 

Ethanol futures were lower. October ethanol ended down US$0.015 to US$1.635, and November ethanol settled down US$0.023 to US$1.617.