November 30, 2007

 

CBOT Corn Review on Thursday: Lower on speculative selling, wheat retreat

 

 

Chicago Board of Trade corn futures ended lower and near session lows as speculative selling and a pullback in wheat values from sharply higher levels set earlier in the day pressured prices, analysts said.

 

March corn fell 3 3/4 cents to US$4.00 3/4 a bushel.

 

Corn was supported by the rally in wheat although the market really didn't reflect it, said Dale Durchholz, an analyst at Agrivisor in Bloomingtonne, Ill. Without the early gains in wheat, corn might have traded even lower, Durchholz said.

 

CBOT March wheat settled up 6 1/2 cents at US$8.88 1/4, after trading as high as US$9.11 in open auction activity.

 

The inability of March wheat to trade limit up led to speculative liquidation in wheat that spilled over into corn, a commission house analyst said. The retreat in crude oil futures from sharply higher levels set in overnight trade also trimmed upside interest in corn, the analyst said.

 

Strong weekly export sales did provide initial support for the market, an e-CBOT trader said. The U.S. Department of Agriculture reported that weekly corn export sales for the week ended Nov. 22 were 1.842 million metric tonnes, near the upper end of the 1.0-to-2.0 million expected by analysts.

 

Energy has been leading commodity prices higher and the recent turnaround in crude oil has led the grains to de-couple from energy at least temporarily, Durchholz said.

 

A stronger U.S. dollar also contributed to the weak tonnee in corn, as a higher valued dollar is a negative for grain exports, a trader said

 

On daily technical charts, electronically traded March remained just above its 10-day and 20-day moving averages.

 

In options trading, Citigroup bought 2,000 July US$5.00 calls and Tenco bought 1,000 March US$3.90 puts.

 

Oat futures finished lower as long liquidation weighed on the market, a trader said.

 

March oats settled 1 cent lower at US$2.83 1/2 a bushel.

 

Ethanol futures finished mixed. December ethanol fell 1.5 cents to US$1.915 a gallon and January rose 1 cent to US$1.83.