September 27, 2007

 

CBOT Corn Review on Wednesday: Settles higher as wheat, soy support

 

 

Chicago Board of Trade corn futures ended higher Wednesday, making new session highs at the close on a strong wheat rally. Wheat futures surged to limit-up, or up 30 cents to another new all-time high and that supported corn, analysts said. December wheat settled 30 cents higher at US$9.17 1/4 per bushel.

 

December corn gained 3 1/4 cents to US$3.75 per bushel, and March rose 3 1/2 cents to US$3.90 3/4.

 

Corn traded modestly higher for much of the session based on spillover from wheat and soybeans, but was unable to generate much upside momentum despite the sharp rallies, analysts said. November soybeans settled 17 3/4 cents higher at US$9.90 3/4.

 

"Corn couldn't trade more than a couple of cents higher for most of the session despite new all-time highs set in wheat futures as well as strong gains posted in soybeans and soybean meal," said Jack Scoville, vice president at Price Futures Group.

 

The market "really felt the impact of harvest pressure and if it wasn't for the other markets, corn would have been influenced more by the harvest," said Scoville.

 

Farmers continue to harvest what is expected to be the largest crop on record and reports indicate strong yields.

 

At the close, corn rallied to session highs as December and March wheat extended their earlier gains and traded limit up. Speculative and technical buying near the close added to the late gains, a trader said.

 

With wheat and soybean prices rallying the price of corn can't fall too far behind the other grains in order to not lose all the acres it gained this year, an E-CBOT trader said.

 

Price direction on Thursday will depend on what wheat does in overnight activity and the weekly U.S. export sales report due out ahead of the day session open, the E-CBOT trader said. Analysts expect weekly corn export sales between 600,000-to-1.4 million metric tonnes for the week ended Sept. 20. The report is scheduled for release at 8:30 a.m. EDT.

 

On daily technical charts, electronically traded December corn traded an outside day, above the high and low established in Tuesday's activity but was unable to settle above its 200-day moving average.

 

Commodity fund buying was estimated at 2,000 contracts.

 

In options trading, Tenco bought 4,000 December US$3.60 puts and sold 4,000 December US$4.00 calls. Prudential bought 500 December 2008 US$5.00 calls.

 

Oat futures ended at unchanged levels, ignoring the gains in wheat futures with commodity fund interest on both sides of the market, a trader said.

 

December oats settled unchanged at US$2.81 1/2 per bushel.

 

Ethanol futures ended lower in modest activity. October ethanol settled 2.5 cents lower at US$1.51 1/2 per gallon and November settled 6 cents lower at US$1.50.