October 18, 2007

 

CBOT Corn Review on Wednesday: Finishes lower amid consolidation

 

 

Chicago Board of Trade corn futures settled lower in quiet trading Wednesday as the market consolidated on the lack of fresh news and spillover weakness from wheat, analysts said.

 

December corn settled 2 1/2 cents lower to US$3.58 per bushel.

 

"Corn was watching wheat all day and when wheat moved lower, corn followed," said Joe Bedore, floor manager at FC Stonnee. December wheat settled 8 cents lower at US$8.20 1/2 per bushel.

 

Light technical selling added to the poor tonnee, with December corn unable to trade above resistance at US$3.62, said Bedore.

 

The market "has had a nice run-up in values recently and was due for some consolidation," said Vic Lespinasse, an analyst at Illinois Grain. "You have to feed a bull market every day, but there wasn't anything to feed it, and corn was lower as a result," Lespinasse said.

 

Despite a rally in crude oil futures to new all-time highs during the session, which supported commodities in general, corn didn't really follow the energy markets, a trader said. Despite the rally, crude oil ended the session lower.

 

Commodity fund selling was light, but with trading activity modest, "its impact on the market was exaggerated," the trader said.

 

Price direction Thursday will depend on the weekly export sales and what happens in outside markets, a trader said. Analysts expect sales between 900,000 and 1.4 million metric tonnes for the week ended Oct. 11. The report is due out at 8:30 a.m. EDT.

 

On daily technical charts, electronically traded December traded an "inside day," within the range established in Tuesday's session.

 

In open-auction trading, commodity fund selling was estimated at 1,000 contracts.

 

In options trading, RJ O'Brien bought 1,000 December US$3.30 puts and sold 1,000 December US$3.60 calls. JP Morgan bought 1,000 December US$3.70 puts.

 

Oat futures ended modestly higher as early fund buying in December helped underpin prices, a floor trader said.

 

December oats gained 2 3/4 cents to US$2.78 3/4 per bushel.

 

Ethanol futures also finished higher in quiet activity. November ethanol settled 2.1 cents higher to US$1.631 per gallon and December also gained 2.1 cents to US$1.631.