November 17, 2005
CBOT Corn Outlook on Thursday: Steady-Up 1 cents on exports, short covering
Corn futures at the Chicago Board of Trade are called to begin trading Thursday flat to slightly higher on stronger than expected export sales and short covering after the market fell to new contract lows Wednesday, sources said.
In overnight e-CBOT trading, December corn slipped 1/4 cent to US$1.92 1/2 per bushel, March fell 1/2 cent to US$2.06 1/4, and May lost 1 cent to US$2.14 1/2 per bushel.
"We should see some support on this morning's export sales and some position covering after yesterday's losses," a floor analyst said. It depends on what the funds want to do after pressing it lower Wednesday and any fresh bird flu concerns, he added.
Weekly export sales of U.S. corn totaled 1.496 million metric tonnes, a marketing year high and well above the 800,000-1,000,000 expected by analysts. Major buyers included Japan, Taiwan, Egypt and Cuba.
Commodity fund trading was a feature of Wednesday's trade with commodity fund selling estimated at 10,000 contracts as the market sold off to set new contract lows in several months.
Growing concerns about bird flu outbreaks in China will continue to garner market attention, local traders said. China reported two new outbreaks of bird flu Thursday. One is in Hubei province and the other is in the northwestern province of Xinjiang, Xinhua, the official Chinese news agency reported.
Corn futures on China's Dalian Commodity Exchange ended mostly lower with the May contract down RMB2/tonne to RMB1,236/tonne.
On technical charts, analysts set first resistance for March corn at US$2.08, and then at Wednesday's high of US$2.10. First support is pegged at US$2.06, Wednesday's low and new contract low, and then at US$2.05.
Cash corn basis bids were unchanged to higher Thursday morning as farmers maintain tight ownership of the newly harvested crop. Central Illinois was unchanged at 5 cents over December futures, while St. Louis was also unchanged at 11 cents over December futures.
