December 6, 2007

 

CBOT Corn Review on Wednesday: Ends flat; consolidates in choppy trade

 

 

Chicago Board of Trade corn futures settled at unchanged levels in most contract months Wednesday on light profit-taking in two-sided trade.

 

March corn settled unchanged at US$4.11 1/4 per bushel.

 

Corn traded higher early in the session but turned lower after March failed to trade above Tuesday's 5 1/2-month high on daily technical charts, a trader said.

 

A rally in soybean meal with some contracts making new life-of-contract highs helped supply support, but "the market didn't have much direct news to influence it," said Vic Lespinasse, an analyst at Illinois Grain.

 

January soymeal traded as high as US$304.00 per short tonne, a new contract high and its highest level since July 2004. January soymeal settled at US$303.40. Both soymeal and corn are used as animal feed.

 

Corn has had a pretty strong rally recently and was due for some consolidation, said Lespinasse.

 

A strong U.S. dollar and the inability of crude oil to maintain much of its price strength also capped the upside in corn, the trader said.

 

Light commodity fund buying and thin corn-wheat spreading helped limit the down side, the trader noted. In open auction trading, commodity fund buying was estimated at 1,000 contracts.

 

On daily technical charts, electronically traded March settled above its major moving averages, but traded an "inside day," between the high and low set in Tuesday's session.

 

Price direction in corn Thursday will depend on the level of export sales and the weather forecast in South America, an analyst said.

 

The U.S. Department of Agriculture is scheduled to release the weekly export sales report for the week ended Nov. 29 on Thursday at 8:30 a.m. EST. Analysts expect sales between 1.1 million to 1.5 million metric tonnes. Sales for the week ended Nov. 22 were 1.8 million tonnes.

 

In options trading, JP Morgan bought 1,500 March US$4.20 calls and UBS bought 2,000 March US$4.10 calls.

 

Oat futures ended unchanged to modestly higher as light commercial buying in March provided commercial support, an analyst said.

 

March oats settled unchanged at US$2.79 1/4 per bushel.

 

Ethanol futures ended mostly lower. December ethanol settled down 1.5 cents at US$1.965 per gallon and January ended unchanged at US$1.87.