December 21, 2006

 

CBOT Corn Outlook on Thursday: 3-4 cents higher on e-CBOT strength

 

 

Chicago Board of Trade corn futures are predicted to begin trading 3 to 4 cents higher Thursday, in line with the gains established in overnight electronic trading, sources said.

 

In overnight e-CBOT trading, March corn gained 4 1/4 cents at US$3.77 per bushel and May also rose 4 1/4 cents to US$3.85 1/2. March volume on the e-CBOT was 6,927 contracts.

 

The market couldn't move higher during Wednesday's day session so it moved higher overnight, a floor analyst said. There has been no follow-through in either direction, since often participants are absent from the market at this time of year, he added.

 

Weekly export sales were good and could provide some support to the market, but at this time of the year any decent-sized order can move the market, a commission house analyst said.

 

The U.S. Department of Agriculture reported that weekly corn export sales totaled 1.35 million metric tonnes for the week ended Dec. 14, slightly above the 1.0 million to 1.3 million tonnes expected by analysts. This total includes sales of 83,400 tonnes for delivery in 2007-08.

 

The largest buyers on the week included South Korea, sales to unknown destinations and Taiwan.

 

Total sales commitments are up 35.3% from last year.

 

On day session open auction technical charts, the upside objective for the bulls remains closing prices above solid resistance at US$3.80 per bushel in March. The bears continue to target this week's low of US$3.62, a technical analyst said.

 

First resistance is seen at Wednesday's high of US$3.75 and then at US$3.80. First support is pegged at US$3.70 and then at US$3.65.

 

In other news, South Korean officials plan to slaughter tens of thousands of poultry after a new outbreak of bird flu was confirmed in the central part of the country, an Agriculture Ministry official said Thursday. The outbreak is the country's fourth in a month. It remains unclear whether the bird flu is the virulent H5N1 strain, said Lee Joo-won, a ministry official.

 

Corn futures on China's Dalian Commodities Exchange settled mostly higher with the benchmark May contract settling up RMB9 at RMB 1,626/tonne.