December 22, 2006

 

CBOT Corn Review on Thursday: Settles higher on technical buying

 

 

Chicago Board of Trade corn futures settled higher Thursday, supported by technical buying in modest trading.

 

March corn rose 5 cents to US$3.77 3/4 per bushel and May corn gained 4 1/4 cents to 3.85 1/2. e-CBOT day session volume in March was 38,202 contracts.

 

The market rallied early on technical buying and spillover from the gains in overnight activity but was unable to add to the advances and drifted for the remainder of the session, a commission house analyst said.

 

People thought the funds would come in and support the market after the early technical-based strength but the funds never showed up to trade, he added.

 

Several traders cited strong weekly corn exports as another positive market factor.

 

The U.S. Department of Agriculture reported that weekly corn exports for the period ending Dec. 14 were 1.348 million metric tonnes, above the 1.0 million to 1.3 million expected by analysts.

 

Stronger wheat futures were also supportive to corn, a floor trader said. March wheat settled 9 1/2 cents higher at US$5.03 1/4.

 

The market appears to be holding any break in prices well with more interest on the upside, he added.

 

Weaker crude oil futures also limited the gains with crude oil futures down sharply for much of the session, sources said.

 

On open auction technical charts, March corn settled above its major moving averages for the first time since Dec. 1.

 

Buyers Thursday included Shatkin, which bought 500 March, Man Financial, which bought 500 March, ADM Investor Services, which bought 300 July, and Iowa Grain, which bought 300 March.

 

ADM Investor Services sold 500 July, JP Morgan sold 500 March and 300 December, UBS sold 400 March, and Fortis sold 600 March.

 

Commodity fund buying was estimated at 600 contracts.

 

In options trading, Advantage futures sold 4,000 March US$3.90 calls and 4,000 March US$3.90 puts. Advantage also sold 3,000 February US$3.75 calls and 3,000 February US$3.75 puts.

 

Oat futures settled higher as spillover from stronger corn and wheat futures and light fund buying steadied prices, source said. The order flow was light as oats traded in holiday type markets, a local trader said.

 

March oats settled 2 1/2 cents higher at US$2.72 3/4 per bushel and May gained 3 1/4 cents to US$2.77 1/2.

 

Ethanol futures ended with modest gains in very quiet trade. The January contract added on 2.2 cents to US$2.407 per gallon. The February contract did not trade and ended 2.8 cents higher at US$2.275.

 

Friday, the Chicago Board of Trade will close at 12:00 p.m. CST and will be closed Monday in observance of Christmas.