December 16, 2005

 

CBOT Corn Review on Thursday: Slips on lack of fresh news, spillover

 

 

Corn futures at the Chicago Board of Trade ended Thursday at lower levels as the absence of fresh inputs and weakness in soybeans and wheat weighed on prices in a holiday-type trading atmosphere, sources said.

 

March corn declined 2 1/2 cents to US$2.04 3/4 per bushel, May fell 2 1/4 cents to US$2.14, and July also settled 2 1/4 cents lower at US$2.22 1/2 per bushel.

 

"There is nothing independently supportive for corn," said John Kleist of Kleist Ag Consulting in Arlingtonne Heights, Ill. The market needs better fundamentals and it doesn't have them. A private European analytical firm raised its estimate of next year's corn production in Europe, and export sales, when you average them out, were tepid at best, he added.

 

Strategie Grains, a private European analytical firm, raised its estimate of 2006-07 E.U. corn production to 50 million metric tonnes, up four percent on the year.

 

Export sales were pegged at 920,600 tonnes by the U.S. Department of Agriculture, above the 600,000-800,000 expected by analysts but was viewed as routine by most analysts.

 

A late decline in wheat futures and the negative tonnee in soybeans also limited buying interest in corn as it continues to lean on other markets for price direction, a floor traderr said.

 

Buyers on Thursday included UBS buying 1,000 March, Merrill Lynch buying 800 March, Fimat buying 800 March, and the Refco division of Man Financial buying 200 March.

 

Sellers Thursday included Fimat selling 900 March, O'Connor selling 500 March, Rand selling 400 March, the RIS division of Man Financial selling 500 March, Goldenberg Hehmeyer selling 200 March and ADM selling 200 March.

 

Oat futures plunged as long liquidation thought to be fund and commission house-related pushed prices lower after the recent sharp runup, a floor trader said. "We've taken out almost two weeks of price appreciation in one day now that December is off the board," a commission house broker said.

 

Sellers included Man Financial, ADM and Shatkin. The March future settled 16 cents lower to US$1.87 1/2 and has fallen almost 20 cents in the last two trading sessions and is over 30 cents lower from where the December future went off the board.

 

Ethanol futures finished higher. The most-active April contract did not trade but settled 3 cents higher at US$1.97 1/2 per gallon.

 

On Friday, the Commodity Futures Trading Commission is scheduled to release the latest Commitment of Traders Report at 1430 CST (2030 GMT).

 

Early Thursday afternoon, the Canada Border Services Agency, or CBSA, said it made a preliminary determination that U.S. grain corn exports to Canada are dumped and subsidized and that it would impose immediate provisional duties of USUS$1.65 per bushel on U.S. corn.