November 9, 2007

 

CBOT Corn Review on Thursday: Settles near highs as speculators buy

 

 

Chicago Board of Trade corn futures ended higher and near session highs Thursday, boosted by late speculative buying ahead of Friday's U.S. Department of Agriculture report and buying interest in commodities in general, an analyst said.

 

December gained 5 1/4 cents to US$3.89 1/2 per bushel.

 

The corn market was also supported by spillover from higher precious metals prices, said Mike Zuzolo, chief analyst at Risk Management Commodities in Lafayette, Ind. Both gold and silver futures traded higher for much of the session before giving back some of their gains late.

 

Lower crude oil futures had little impact on corn prices, though a weaker dollar against other currencies did provide underlying support, a commission house analyst said.

 

Corn-wheat spreading was also a positive factor for prices, the commission house analyst said, noting that a poor weekly export sales report encouraged selling in wheat. CBOT December wheat settled 25 3/4 cents lower at US$7.62 and is nearly US$2 per bushel under its all-time high set earlier in the year.

 

Stronger-than-expected weekly corn export sales provided additional momentum with sales of 1.548 million metric tonnes for the week ended Nov. 1, well above analyst estimates of 600,000-to-900,000 tonnes.

 

Given the recent market volatility, short position holders covered some of their holdings ahead of Friday's reports, a trader said. The USDA is scheduled to release its updated estimates of crop production and supply/demand at 8:30 a.m. EST (1330 GMT).

 

The average estimate for U.S. corn production was 13.261 billion bushels, 57 million bushels below the 13.318 billion forecast in October by the USDA, according to a survey of 24 analysts by Dow Jones Newswires.

 

"Price direction Friday will depend on what is released at 8:30 EST," the trader said.

 

On daily technical charts, December remained above its major moving averages.

 

In options trading, Tenco bought 3,000 December US$3.50 puts and sold 2,000 December US$3.70 puts.

 

In open auction activity, fund buying was estimated at 2,000 contracts.

 

Oat futures finished little changed with flat price activity thin as funds rolled out of their December positions into March, a floor trader said. There wasn't much interest in trading oats outright, the trader added.

 

December oats rose 1/4 cent to US$2.95 1/2 per bushel and March slipped 1/4 cent to US$3.08 3/4.