September 30, 2009

 

CBOT Corn Review on Tuesday: Ends up on technical buys, autumn chill

 

 

Chicago Board of Trade corn futures ended higher Tuesday, with technical buying and chilly weather offering support, traders said.

 

December corn ended up 2 1/4 cents to US$3.41 per bushel, and March corn ended up 2 3/4 cents to US$3.54.

 

Cold weather during the first half of this week in the northern corn belt, with temperatures dipping around freezing, is helping make traders jittery and putting some weather premium in the market, traders said.

 

There is also plenty of wet weather in the forecast for the corn belt, which analysts say will continue to stymie late development and delay harvest.

 

But many traders and analysts dismiss the cold weather as too little, too late to cause much damage to the crop, and point out that the heart of the corn belt is not expected to see a significant frost threat for the next 10 days.

 

Other traders attributed Tuesday's gains primarily to technical buying.

 

The market opened higher but was unable to breach resistance at the September high of US$3.47 3/4 in early trade and retreated, briefly trading lower at midday before regaining its footing.

 

"The bottom line is corn is going to have a tough time holding together when you've got wheat down a dime and soy softening up," said Chad Henderson, analyst with Prime Ag Consultants.

 

Traders and analysts say the market is range-bound, with dwindling support above US$3.50.

 

Traders noted positioning ahead of Wednesday's quarterly grains stocks report. The report is not expected to be a newsmaker. The trade is expecting the USDA to report healthy fourth-quarter corn stocks, which also represent ending stocks for the 2008-09 marketing year. The report will be released at 8:30 a.m. EDT.

 

Weak feed demand is seen as a main factor keeping supplies ample.

 

CBOT oats futures ended higher Tuesday. The market gapped higher on the open, and the December contract's high of US$2.35 was its highest price since July 14. December oats ended up 9 cents to US$2.34 per bushel, and March oats ended up 9 cents to US$2.47 1/2.

 

Ethanol futures were higher. October ethanol ended up US$0.043 to US$1.765 per gallon, and November ethanol ended up US$0.020 to US$1.679.