December 15, 2006

 

CBOT Corn Outlook on Friday: 1/2-1 cent lower in market consolidation

 

 

Chicago Board of Trade corn futures are predicted to begin trading 1/2-to-1 cent lower Friday as the market follows the tone established in the overnight session and consolidates ahead of the weekend, sources said.

 

In overnight e-CBOT trading, March corn slid 3/4 cent lower to US$3.71 per bushel and May lost 1 1/2 cents to US$3.78. e-CBOT volume in March was 3,352 contracts.

 

Corn should start out easier on some profit taking after Thursday's strength as well the weaker prices in overnight trade, a floor analyst said. Trading should remain choppy and two-sided as more participants consolidate their positions ahead of the holidays.

 

Now that the Informa acreage numbers are out of the way, the market is waiting on the crop production, stocks and supply-demand reports due out in early January, he added.

 

Since Dec. 6, March corn has traded within a 12 1/2-cent range, bounded by US$3.76 on the upper end and US$3.63 1/2 on the bottom end of the range.

 

The lack of fresh news should keep the market drifting within the recent technical trading range, a commission house analyst noted. In addition, the weather in South America remains favorable for crop production, he added.

 

Scattered showers and thundershowers are forecast in crop growing areas of both Brazil and Argentina over the weekend, DTN Meteorologix Weather said.

 

On day session open auction technical charts, prices closed near session highs but remain in a sideways trading pattern in choppy trading, a market technician said.

 

First resistance for March corn is seen at Thursday's high of US$3.74, and then at US$3.76, this week's high. First support is seen at Thursday's low of US$3.66 1/4 and then at US$3.63 1/2.

 

In other corn news, South Korea bought 110,000 metric tonnes of optional-origin non-GMO corn in a tender concluded overnight, sources said.

 

Corn futures on China's Dalian Commodities Exchange settled slightly higher with the most active September contract up RMB/5 to RMB 1,701/tonne.