October 17, 2007

 

CBOT Corn Outlook on Wednesday: Down 2-3 cents on weaker e-CBOT trade, lacks news

 

 

Chicago Board of Trade corn futures are predicted to begin day session trading 2-to-3 cents lower Wednesday, following the tone set in the overnight session with the market lacking fresh news, analysts said.

 

In overnight electronic trading December corn declined 3 cents to US$3.57 1/2 per bushel and March fell 3 1/4 cents to US$3.74. E-CBOT volume in December was 3,324 contracts.

 

The market is lacking fresh inputs and as a result looks to open lower following the overnight trend, a floor trader said. With the absence of fresh news it could be a choppy, two-sided trade, he said.

 

Corn looks to consolidate after the gains seen late last week and without any new factors to push the market higher, a commission house analyst said. Gold and silver are higher but crude oil is near unchanged so outside market support may be lacking compared with recent sessions, the analyst said. The weather looks like it might delay the harvest activity over the near-term in parts of the U.S. Midwest but it's not considered to be a problem.

 

Wet or very wet weather expected for the western U.S. Midwest will likely delay harvest activity, DTN Meteorlogix Weather said.

 

In the western Midwest showers will occur through Thursday with amounts of 0.30-to-1.50 inches. Temperatures are expected to average near-to-above normal, Meteorlogix Weather said.

 

In the eastern U.S. Midwest, there is a chance for scattered to widely scattered thundershowers, with amounts 0.25-to-1.00 inch and locally heavier Thursday and showers may linger into Friday. Temperatures are expected to average above normal.

 

On daily open auction technical charts, December corn closed lower Tuesday, pressured by profit-taking after recent gains, a technical analyst said. Corn bulls still have some upside technical momentum amid the general rally in commodities and the weak U.S. dollar, the analyst said. The bulls' next upside price objective remains moving prices above solid resistance at US$3.68 per bushel, which is the top of a big downside price gap on the daily bar chart. The next downside price target for the bears is closing prices below solid support at US$3.50.

 

First resistance for December corn is seen at US$3.62 1/2, this week's high and then at US$3.68. First support is seen at US$3.54 3/4 and then at US$3.50.

 

In other corn news, cash corn prices in China were stable in the week ended Wednesday but the harvest of this year's crop may put downward pressure on prices, analysts said.

 

Corn futures on China's Dalian Commodities Exchange settled lower on spillover from weaker soybean futures with the May contract down RMB10 at RMB1,651/tonne.