December 25, 2009

 

CBOT Corn Review on Thursday: Ends up on crude gains, weaker dollar

 

 

Chicago Board of Trade corn futures ended higher Thursday, climbing in light trade amid supportive outside markets and impressive export sales.

 

May corn ended up 3 1/2 cents to US$4.18 3/4, and July corn ended up 3 1/4 cents to US$4.28 1/4.

 

Gains in crude oil and a weaker dollar helped set the tonnee, as the corn market pulled further away from key moving averages and the psychologically important US$4 mark, where it hovered for most of the past week.

 

Analysts noted that export sales were strong for the second week in a row. Net sales topped 1.5 million metric tonnes, a marketing year high. Traders said that while the pickup in sales is an encouraging sign, the increase will need to be sustained to become a bullish factor in the market.

 

"Corn needs to continue to see good export sales," Jim Riley, analyst for Linn Group, said in a commentary.

 

Funds bought an estimated 1,000 contracts. Traders said the expectation of index fund rebalancing at the start of the year is considered supportive for corn and has underpinned the market recently.

 

With several hundred million bushels of corn still in the field and unlikely to be harvested soon, concerns about crop losses are providing underpinning support, according to some analysts. A winter storm in the U.S. Midwest will delay harvest further, and is also restricting grain movement, according to analysts.

 

The March contract gained 10 3/4 cents on the week and ended just below the week's high. The market gained despite losses in wheat and flat soy prices.

 

The market will be closed Friday for Christmas, and trade will resume Sunday evening.

 

CBOT oats futures ended higher Thursday. March oats ended up 1 1/2 cents to US$2.60 per bushel and May oats settled up 1 1/2 cents to US$2.68 1/4.

 

Ethanol futures were higher. January ethanol settled up US$0.018 to US$1.880 per gallon and March ethanol ended up US$0.011 to US$1.849.