October 4, 2006

 

CBOT Corn Outlook on Wednesday: Steady to 1 cent higher start seen

 

 

Chicago Board of Trade corn futures are expected to begin trading steady to 1 cent higher Wednesday as the market searches for direction with little fresh inputs to provide direction, sources said.

 

In overnight e-CBOT trading, December corn rose 1/2 cent to US$2.64 1/2 per bushel and March ended unchanged at US$2.78. e-CBOT volume in December was 2,328 contracts.

 

The market should garner some support from stronger outside markets, a commission house analyst said. Tuesday's losses in metals ad energies helped to weigh on the market and a general rally in outside markets will help support corn, he added.

 

There is little fresh news out to influence market direction, a floor trader said. Farmers continue to harvest the crop which could provide some pressure to prices but speculative traders could return to the market as buyers after providing some downward price pressure Tuesday.

 

Commodity fund selling was estimated at 4,300 contracts Tuesday.

 

After a few showers in parts of Minnesota and eastern Iowa Wednesday, mainly dry weather is forecast through Sunday in the western U.S. Midwest, DTN Meteorologix Weather said. Temperatures should average above normal during the weekend.

 

In the eastern U.S. Midwest, scattered showers and thunderstorms are expected Wednesday into Thursday with amounts of .30-1.00 inch and locally heavier, DTN Meteorologix Weather said. After the system moves east, mainly dry weather will extend from Thursday into the weekend.

 

On technical charts, first resistance for December corn is seen at US$2.65, Monday's high and then at US$2.69 1/2, a market technician said. First support is pegged at US$2.61 3/4 and then at US$2.60.

 

Corn basis bids were unchanged to mostly higher Wednesday. Central Illinois was 2 cents lower at 5 cents under the December future.

 

In other corn news, South Africa's corn crop planted in 2005 is estimated at 6.3 million tonnes, 46% lower than in 2004. Producers are expected to increase the area planted this year to potentially produce a 10 million metric tonne crop this year, according to a U.S. Department of Agriculture attach¡¡ì¦ report posted Tuesday on the Foreign Agricultural Web site.

 

China's corn futures markets remain closed due to a holiday.