CBOT corn ends higher on support from wheat futures

 

 

US corn futures ended higher on Thursday (Oct 28), buoyed by spill-over strength from wheat futures in the absence of fresh direction-providing news.

 

CBOT December corn ended US$0.01 three-quarters or 0.3% higher at US$5.79 a bushel. Speculative fund buying was estimated at 6,000 lots.

 

Corn's price gains were dependent on wheat advances, particularly with export developments quiet, reflective of weekly export sales falling in line with expectations, an analyst said.

 

Weekly US corn export sales data, issued Thursday (Oct 28), was at 550,300 tonnes, within analysts' expectations. The business was up from poor sales last week but still seen as unimpressive.

 

The lack of confirmation of rumours of China buying corn for import left futures without fundamental support, keeping corn in the role of a follower, the analyst added.

 

China's largest state-owned grain trader, Cofco, said it has not bought any US corn shipments in the marketing year that began on October 1 but may consider purchases after the spring of 2011.

 

As China's appetite shifts the global grain landscape, a recent USDA forecast which predicted that China may import 1 million tonnes of corn this marketing year has spurred market speculation that the Asian giant is in the market for more.

 

Weakness in the US dollar provided broad-based commodity strength while concerns about tightening global corn supplies added light support to keep futures trading at the top end of a two-week trading range.

 

Outlooks for the USDA to further tighten the US balance sheet with the potential for lower yield and production forecasts provided underlying support. News that the International Grain Council had cut their global corn production forecasts provided minor strength as well, analysts said.

 

Meanwhile, the unwinding of long corn/short wheat spreads limited advances, with traders booking profits ahead of Friday's (Oct 29) last trading day of the month.