November 16, 2007

 

CBOT Corn Review on Thursday: Ends near lows on speculative sales, weak metals

 

 

Chicago Board of Trade corn futures settled lower and near session lows Thursday, influenced by early losses in crude oil and precious metals in the absence of fresh news.

 

Dec corn settled 8 1/4 cents lower at US$3.74 3/4 per bushel and Mar also fell 8 1/4 cents to US$3.91 3/4.

 

Speculative liquidation late in the session extended the declines, an analyst says. The combination of the declines in crude oil, gold and silver helped push the market lower, said Joe Bedore, floor manager at FC Stonnee.

 

Nearby crude oil ended at US$93.37, down 72 cents and spot gold plunged US$27.40 to US$787.30 per ounce. Corn's recent rally was overextended and due for a retracement, said Bedore.

 

In a macro-view people appeared to be exiting commodities, a trader said. There was no fresh news out to influence price direction so corn followed the path of the "inflationary" markets and sold off near the close, a commission house analyst said.

 

Technical selling added to the declines late with both December and March falling to their 20-day moving averages.

 

On daily technical charts, electronically traded March settled at its lowest level since Nov. 1.

 

In options trading, JP Morgan bought 2,000 December US$3.80 calls and Tenco bought 800 January US$4.10 calls.

 

In open auction activity, fund selling was estimated at 4,000 contracts.

 

Oat futures ended lower as producer selling pressed prices lower, an analyst said. The recent weakness in the Canadian dollar is making it attractive for Canadian producers to hedge their crop, the analyst said.

 

December oats fell 2 cents to US$2.84 1/2 per bushel and March declined 2 1/2 cents to US$2.98.

 

Ethanol futures settled mostly higher. December ethanol gained 1.3 cents to US$1.868 per gallon and January rose 4.3 cents to US$1.813.

 

On Friday, the U.S. Department of Agriculture is scheduled to release the weekly export sales report at 0830 EST. Analysts expect sales between 800,000-to-1.5 million metric tonnes for the week ended Nov. 8. The report was delayed a day due to Monday's holiday.