November 30, 2005

 

CBOT Corn Outlook on Wednesday: Flat-Up 1/2 cent, following overnight trade

 

 

Corn futures at the Chicago Board of Trade are forecast to begin open auction trading flat to 1/2 cent higher Wednesday, following the tone established in overnight trading, sources said.

 

In e-CBOT trading, December corn ended 1/4 cent higher at US$1.86 1/2 per bushel, March rose 1/2 cent to US$2.01, and May gained 1/2 cent at US$2.09 3/4 per bushel.

 

The market is lacking any true fundamental direction and should chop around, said Shawn McCambridge, senior grain analyst with Prudential Financial. There is good commercial support at these price levels, and Tuesday's volume of 240,000 contracts in a small price range also shows good support for the market. However, the key is the funds and what they want to do.

 

Cash corn basis bids were unchanged to higher Wednesday morning. Central, Illinois was unchanged at 10 cents over December futures, while St. Louis was 5 cents higher at 17 cents over December futures.

 

The CBOT reported 3,363 deliveries against the December corn contract. Large issuers included the house account of ADM Investor Services which issued 1,954 contracts, the customer account of ABN Amro, which issued 700 contracts, and the customer account of R.J. O'Brien which issued 507 contracts. Large stoppers included the house account of Deutsche Bank Securities, which stopped 1,158 contracts.

 

On technical charts, analysts say it will take a close above US$2.07 to provide bulls with some fresh technical momentum. First resistance for March corn is seen at US$2.01 3/4, Tuesday's high and then at US$2.02 3/4, this week's high. First support is pegged at the contract low of US$2.00 1/4, and then at US$2.00.

 

In other corn news, South Korea's Major Feedmeal Group (MFG) bought 110,000 metric tonnes of U.S. No. 2 corn from Cargill a Seoul-based trader said.

 

Israel has tendered for up to 30,000 metric tonnes of U.S. corn, sources said.

 

With 80% of the crop harvested, Hungary reported 7 million metric tonnes of corn had been collected, according to the Ministry of Agricultural and Rural Development.

 

Corn futures on China's Dalian Commodity Exchange ended at slightly higher levels with the most active September contract up RMB3/tonne to RMB1,278/tonne.