November 26, 2005

 

CBOT Corn Review on Friday: New lows set in quiet trade

 

 

Corn futures at the Chicago Board of Trade settled modestly lower Friday, scoring new contract lows once again, as light fund selling, spillover weakness from soybeans and light rollover trading kept prices on the defensive, sources said. Activity was modest with some traders absent, extending their holiday.

 

December corn declined 1 cent to US$1.89 3/4 per bushel, March corn slipped 1 1/2 cents to US$2.02 3/4, and May corn fell 1 1/4 cents to US$2.11 1/4 per bushel.

 

Fund selling kept the market on defensive with the weakness in soybeans also addeing pressure to the market, a floor broker said. The market is searching for favorable news and not finding it, he added.

 

Commodity fund selling was estimated at 2,500 contracts.

 

January soybeans declined to their lowest level since mid-February on improved weather in South America, technical selling and weaker-than-expected weekly export sales.

 

Reports of an additional case of bird flu in China also dampened buying interest as did news that China had exported over 400,000 metric tonnes of corn in October. Although the amount was not large, the fact that the Chinese remain exporters was viewed negatively, sources said.

 

Friday morning's export sales, released a day late due to the holiday, were 1.032.8 million metric tonnes, above the high end of analysts' estimates. Although sales were above expectations, they were not enough to provide support, a floor analyst said.

 

Better weather in corn-producing regions in Argentina also limited buying interest as recent rainfall helped the recently planted crop in that country.

 

Buyers on Friday included Cargill buying 500 March and 100 December, Fimat buying 400 December and 300 March, Tenco buying 600 December and R.J. O'Brien buying 200 December and 200 March.

 

Sellers on Friday included Fimat selling 1,000 March, Refco Investor Services selling 500 December, O'Connor selling 300 December, Kottke selling 300 March and ABN Amro selling 400 March.

 

In spread trading, O'Connor was noted spreading 2,600 December-March.

 

Oat futures settled moderately higher as light buying lifted prices. The March contract gained 3 1/4 cents to US$1.84 3/4.

 

Ethanol futures ended mostly lower. The January contract which did not trade, settled unchanged at US$1.88 1/2 cents per gallon.

 

The CFTC commitment of traders report, usually released on Fridays, will be delayed until Monday due to the Thanksgiving Day holiday, according to the CFTC's Web site.