December 14, 2005

  

CBOT Corn Outlook on Wednesday: Steady to 1 cent higher, following e-CBOT

  

 

Corn futures at the Chicago Board of Trade are expected to begin Wednesday's open auction session steady to 1 cent higher with the absence of fresh fundamental news leaving technical traders in the driver's seat, sources said.

 

In overnight e-CBOT trading, March rose 1/4 cent to US$2.09, and May gained 1/2 cent to US$2.18 1/4 per bushel.

 

There's nothing positive about the fundamental picture, but technically the market has been strong the last few trading sessions, a floor analyst said. March corn is trading close to its 50-day moving average and it may be difficult to sell the market early in the day. The funds will help determine what the market will do today, he said.

 

The 50-day moving average in March corn stands at US$2.09 1/2.

 

Wednesday is the last trading day for December corn. Preliminary open interest in the contract stands at 1,861 contracts, according to the CBOT.

 

The CBOT reported 1,393 deliveries against the December corn contract Wednesday morning. Large issuers included the customer account of the Century Group Division of Man Financial, which issued 498 contracts, and the customer account of Cunningham Commodities, which issued 303 contracts.

 

Large stoppers included the customer account of ABN Amro, which stopped 509 contracts, the customer account of the Century Group Division of Man Financial, which stopped 259 contracts, and the First Futures Chicago Division of Man Financial, which stopped 220 contracts.

 

Cash basis bids are unchanged to slightly higher Wednesday morning. Central Illinois was unchanged at 2 cents over the March future, while St. Louis was also unchanged at 4 cents over the March future.

 

On technical charts, analysts peg first resistance for March corn at US$2.09 1/4, this week's high and then at US$2.12. First support is seen at US$2.04, the bottom on the daily bar chart and then at US$2.02.

 

In other corn news, cash corn prices in China were mostly higher in the week ended Wednesday amid hopes of a recovery in the local feed industry, traders said. Feed sales were said to have stabilized as China has not reported any bird flu cases this month after reporting 25 cases over the last two months. Talk of rising exports supported local prices last week but local demand remains the most important factor for prices, traders said.

 

Corn futures settled near unchanged levels at China's Dalian Commodity Exchange. The most-active September contract rose RMB1 higher to RMB1,331/tonne.