October 20, 2007

 

CBOT Corn Review on Friday: Settles higher on surging wheat, speculative buys

 

 

Chicago Board of Trade corn futures settled with mild gains Friday, making new highs near the close on speculative buying, an analyst said.

 

December corn settled 3 cents higher at US$3.70 1/4 per bushel.

 

The market was also supported by the sharp rally in wheat futures to limit up in the absence of fresh news, the analyst added.

 

December wheat settled 30 cents higher at US$8.55 1/2 per bushel.

 

Thin technical buying added support as December corn filled a downside price gap on the upside on daily open auction charts.

 

Crude oil futures ended lower after making a new contract high and metals futures were mostly lower, which limited the upside as recent interest in owning commodities was not apparent Friday, a trader said.

 

Inter-market spreading also provided thin strength with corn/soybean spreading acting as support, a commission house analyst said.

 

News near midsession that Informa Economics estimated 2008-09 corn planted acreage at 85.8 million acres, down 7.9 million from 93.6 million planted this year had little impact as the trade is expecting a reduction in acreage next year, given the strong prices for wheat and soybeans, the commission house analyst said.

 

Market direction Monday will depend on what wheat futures do, the weather in South America and energy futures, a trader said.

 

On daily technical charts, electronically traded December settled at its highest level since Oct. 1, but finished below its 200-day moving average.

 

Overall commodity fund buying was estimated at 3,000 contracts.

 

In options trading, MF Global bought 1,000 December US$3.60 puts and RJ O'Brien bought 2,000 December US$3.50 puts.

 

Oat futures finished at unchanged levels, recovering from light fund selling early in the session as thin commercial buying provided support, a trader said. The limit-up gains in wheat had little impact on oats, the trader said.

 

December oats settled unchanged at US$2.82 per bushel. Ethanol futures also ended unchanged in light trade. November ethanol settled at US$1.65 per gallon and December also ended flat at US$1.65.

 

On Friday afternoon, the Commodity Futures Trading Commission was scheduled to release the weekly commitments of traders report for the period ended Oct. 16. On Monday, the U.S. Department of Agriculture was scheduled to release the weekly export inspections report at 11 a.m. EDT and the weekly crop progress report at 4 p.m. EDT.