October 18, 2006

 

CBOT Corn Outlook on Wednesday: Expected to open 3-5 cents lower

 

 

Chicago Board of Trade corn futures are forecast to start trading 3-5 cents lower Wednesday, following the tonnee established in overnight activity, sources said.

 

In overnight e-CBOT trading, December corn fell 5 1/2 cents to US$3.15 1/2 per bushel and March declined 4 1/4 cents to US$3.25. e-CBOT volume in December was 6,734 contracts.

 

The market should see some price weakness to start, a floor analyst said. Corn was lower overnight and should begin the day on a weaker note on profit taking after recent price strength. Corn is overdone and due for a correction, he added.

 

Since making its life of contract low on Aug. 18, December corn has rallied more than 90 cents.

 

There was profit taking overnight on the lack of fund interest, a floor source said. Corn has rallied on technically inspired fund buying and price direction depends on what the funds want to do. "It could be an interesting day," he added.

 

In Tuesday's day session, overall commodity fund buying was estimated at 6,700 contracts.

 

On technical charts, the market has made a very strong run recently and is now due for a decent corrective pullback soon, a market technician said.

 

First resistance for December corn is pegged at Tuesday's contract high of US$3.24 1/2 and then at US$3.30. First support is seen at US$3.16 1/2, Tuesday's low and then at US$3.09 1/2, the week's low.

 

Corn basis bids were unchanged to lower Wednesday. Central, Illinois was unchanged at 6 cents over the December future.

 

In other corn news, South Korea bought 110,000 metric tonnes of optional origin non-GMO corn, sources said.

 

Corn futures at China's Dalian Commodities Exchange settled lower, with the May contract falling RMB/15 to RMB 1,468/tonne.