December 1, 2006

 

CBOT Corn Outlook on Friday: Called 1-2 cents lower on weak e-CBOT

 

 

Chicago Board of Trade corn futures are predicted to start day session trading 1-to-2 cents lower Friday as weaker prices overnight and the lack of fresh news is expected to weigh on futures at the opening, sources said.

 

In overnight e-CBOT trading, December corn fell 2 1/2 cents to US$3.74 1/2 cents per bushel and March slipped 1 3/4 cents to US$3.88 3/4. e-CBOT volume in March was 8,677 contracts.

 

The market should start off on the defensive, a floor analyst said. Prices were lower overnight, the outside markets are weaker and there is a lack of fresh news to trade off of, he added.

 

Talk of additional index fund money coming into the market at the start of the month could temper selling enthusiasm but the market could see profit taking ahead of the weekend, a commission house analyst said. Trading could be two-sided, he added.

 

On day session open auction technical charts, March corn closed near the session high and set a new contract high as the march towards US$4 per bushel continues, a technical analyst said. The bears' next near-term downside price objective is closing prices below solid support at US$3.70.

 

First resistance for March corn is seen at the contract high of US$3.93 and then at US$3.95. First support is seen at US$3.85 and then at Wednesday's low of 3.80.

 

Deliveries posted against the December contract totaled 1,009 contracts. Large issuers included the customer account of Calyon Financial, which issued 850 contracts. Large stoppers included the customer account of Fortis, which stopped 300 contracts, the customer account of the LBS division of Man Financial, which stopped 400 contracts, and the house account of Deutsche Bank, which stopped 277 contracts.

 

The last trade assigned was Oct. 31.

 

Corn basis bids were mostly lower Friday morning. Peoria, Illinois was 7 cents lower at 5 cents under the December future.

 

In other corn news, market sentiment of Chinese grain traders was mostly bullish on a combination of growing demand and rising prices in the domestic market through Wednesday, according to a weekly survey from the China National Grains and Oils Information Center released Friday. Traders' bullishness on corn picked up slightly as processors and exporters seen rushing to buy corn this week, it said.

 

Corn futures on China's Dalian Commodities Exchange ended moderately higher, however, the May contract settled unchanged at RMB 1,590/tonne.

 

Friday afternoon, the Commodity Futures Trading Commission is scheduled to release the commitment of traders data for the period ending Nov. 28.