December 1, 2007

 

CBOT Corn Review on Friday: Settles higher; shakes off early weakness

 

 

Chicago Board of Trade corn futures ended Friday's session posting modest gains, managing to recover from earlier losses.

 

December corn ended 1 cent higher at US$3.84 1/2, and March finished 3/4 cent higher at US$4.01 1/2.

 

The market managed to bounce from initial declines on a midday double-digit rebound in wheat futures, said Shawn McCambridge, senior grains analyst with Prudential Financial in Chicago.

 

The market doesn't have much happening fundamentally or technically, leaving it susceptible to outside influences, he said.

 

Heavy deliveries and sharp early declines in crude oil generated end-of-month profit taking, but once wheat spiked higher and crude oil bounced off its lows, futures uncovered speculative buying, traders said.

 

The exhaustion of early selling allowed futures to sustain the late-session rise, with an absence of technical chart damage from the early slide and end-of-the-day position squaring helping limit selling, despite late losses in neighboring commodity markets, analysts said.

 

The ability of the most active March future to settle above its 10-day and 20-day moving averages were seen as a supportive sign for prices, a CBOT floor analyst said.

 

The DTN Meteorlogix weather forecast said Argentina's central crop areas have a few scattered showers on tap for Saturday and again Tuesday. This will favor early growth of crops but a more widespread rain is needed in the western growing region of Cordoba. Hot temperatures Friday and the weekend will give way to cooler temperatures early next week. Hot weather may redevelop towards the end of next week, Meteorlogix said.

 

December corn deliveries totaled 3,403 lots. Analysts surveyed by Dow Jones Newswires anticipated deliveries in a range of 500 to 2,500 lots. Customer accounts at J.P. Morgan and Astro Div of UBS Securities were the primary issuers of 1,766 and 1,018 lots, respectively. Stoppers were scattered across various commission houses. The last trade date assigned was Nov. 15.

 

In pit trades, JP Morgan bought 500 March and RJ O'Brien bought 400 December. FCStonnnee sold 300 December, JP Morgan sold 400 March, Tenco sold 500 July, and Rand Financial sold 600 March.

 

CBOT oat futures settled mixed amid some pressure from light long liquidation, a floor trader said. March oats ended 1/2 cent lower at US$2.83 a bushel.

 

Ethanol futures finished higher. December ethanol rose 0.035 cents to US$1.95 a gallon and January rose 0.001 cent to US$1.831.