November 30, 2009

 

CBOT Corn Outlook on Monday: Mixed, follow overnight, eyes outside markets

 

 

Corn futures on the Chicago Board of Trade are poised for a mixed start based on overnight themes, with traders eyeing outside markets for clues to direction.

 

Analysts expect corn to open mixed.

 

In overnight electronic trading, December corn was 1/4 cent higher at US$3.97 1/2, and March corn was 3/4 cent lower at US$4.12 3/4.

 

A quiet news front is not providing any fresh influences for prices, but the unwinding of some of Friday's corn/soybean spreading and favorable harvest weather for the next 10-days in the U.S. Midwest is expected to weigh on prices, said Don Roose, president of U.S. Commodities.

 

Outside markets are providing mixed signals to the market, but a weaker U.S. dollar index is a supportive feature expected to limit selling interest.

 

"The big question in the market place is how much new speculative money will flow into the market to start December and that should limit overall selling interest," Roose said.

 

Meanwhile, the nearby December contract will find support from limited delivery notices against the contract. The small deliveries signal that there won't be any dumping of vomitoxin corn in the delivery process, Roose added.

 

A technical analyst said the next upside price objective for March corn is to push and close prices above solid technical resistance at the November high of US$4.25 a bushel. The next downside price objective is to push and close prices below solid technical support at last week's low of US$3.90 1/4 a bushel.

 

First resistance for March corn is seen at Friday's high of US$4.15 and then at US$4.19. First support is seen at US$4.10 and then at US$4.05.

 

The DTN Meteorlogix weather forecast said mainly favorable weather conditions for drying and harvesting corn are on tap for the U.S. Midwest this week, except over southeast and far eastern areas where rain is expected Wednesday. Next week's weather is more uncertain as it could be stormy.

 

In other news, The U.S. Department of Agriculture announced a change in destination Monday for 270,000 metric tonnes of U.S. corn exports, saying it will be delivered to South Korea. Previously the exports were listed as going to "unknown destinations," according to the USDA announcement.

 

In deliveries, December corn deliveries totaled 3 lots. Customer accounts at Citigroup issued and stopped the 3 lots. The last trade date assigned was March 3.

 

The USDA is scheduled to release its weekly export inspections report at 11 a.m. EST, and its weekly crop progress report at 4 p.m. EST.