December 7, 2007

 

CBOT Corn Outlook on Friday: Up 1-2 cents on firm e-CBOT, follow through

 

 

Chicago Board of Trade corn futures are expected to begin day session trading 1 to 2 cents higher, following the gains set in overnight trade and follow through from Thursday's late strength analysts said.

 

In overnight electronic trading, March corn gained 2 1/2 cents to US$4.14 1/2 per bushel. E-CBOT volume in March was 12,897 contracts.

 

Corn should start higher on follow through buying from Thursday's late strength and continued gains in the overnight session, a commission house analyst said.

 

The market is being supported by the need to keep prices at attractive levels to encourage corn acreage this spring with new the crop contracts bumping up against contract highs, said Don Roose, president of US Commodities in West Des Moines, Iowa. In addition, export sales of corn have been strong, leading some participants to believe the U.S. Department of Agriculture will raise its corn export estimate in next week's supply and demand report, said Roose.

 

A few thunderstorms are possible Sunday night into Monday from eastern Cordoba eastward in Argentina with mainly dry weather returning Tuesday and Wednesday, DTN Meteorlogix Weather said. Long range charts have introduced a chance for significant shower activity to the central crop areas later next week. Meteorlogix said.

 

On daily open auction technical charts, March corn futures closed higher and at another fresh 5 1/2 month high close. There are no signs of a market top being close at hand, a technical analyst said. The next upside objective is to push and close prices above solid technical resistance at US$4.23 per bushel with the next downside objective is to push prices below solid support at US$4.00.

 

First resistance for March is seen at US$4.13 3/4, this week's high and then at US$4.17. First support is seen at Thursday's low of US$4.08 3/4 and then at US$4.05.

 

Deliveries posted against the Chicago Board of Trade December future were 2,665 contracts Friday. Large issuers included the customer account of Man Professional Clearing which issued 940 contracts, the customer account of Cunningham Commodities, which issued 304 contracts and the customer account of Shatkin, which issued 285 contracts. Large stoppers included the customer account of Man Professional Clearing, which stopped 680 contracts, and the customer account of Cunningham, which stopped 427 contracts. The last trade assigned was Dec. 6.

 

In other corn news, China will sell 500,000 metric tonnes of corn from state reserves Tuesday, the National Grain & Oil Trade Center said Friday. The sale is part of a plan announced last week to sell 2 million tonnes from state reserves.

 

European Union 2007-08 corn production is forecast at 45.6 million metric tonnes, up from September's forecast of 44.8 million tonnes. However, corn production is down 9.9% from the previous year's crop.

 

Corn futures on China's Dalian Commodities Exchange settled lower with the benchmark May contract down RMB11 to RMB1,735/tonne.