April 10, 2009

 

CBOT Corn Review on Thursday: Ends lower on dollar; unable to hold US$4

 

 

Chicago Board of Trade corn futures ended lower Thursday amid pressure from soybeans and technical weakness.

 

May corn was down 6 3/4 cents to US$3.90 1/4 per bushel, July corn ended down 7 cents to US$3.99 3/4 and December corn ended down 6 cents to US$4.21 3/4.

 

A floor trader said corn fell in part because soybeans were unable to rally on what was seen as a bullish supply and demand report.

 

"Once they failed, people just jumped on the grains," the trader said.

 

The supply and demand report cut projected 2008-09 corn ending stocks to 1.700 billion bushels, which was considered mildly friendly but not enough to spark a rally on its own.

 

"I think most people feel right now where we stand, on the old-crop side of it, that supplies are adequate," said Jason Britt, president of Central State Commodities in Kansas City. "Unless you have a major pickup in demand, we're going to be fine." 
 

The floor trader added that "technically, we're just hitting a wall at US$4." The market has tried to hold momentum above that level, but "there's farmer selling that hits you at about every turn on it," Britt said.

 

Outside influences were mixed. A bearish climb in the dollar appeared to outweigh a supportive rally in equities, a trader said.

 

Funds sold an estimated 4,000 contracts Thursday. The market will be closed Friday for Good Friday.

 

Corn has underpinning support from concerns about a wet, chilly April and its potential to delay planting. Britt said that come Monday, the trade will start the week by assessing weather forecasts and any changes during the weekend.

 

Planting weather is a concern because earlier planting typically offers a better opportunity for strong yields, analysts say. Continued wet weather could also prompt some producers to switch from corn to soybeans, they add.

 

CBOT oats futures ended slightly lower. May oats ended down 1 cent to US$1.96 per bushel and July oats ended down 1 cent to US$2.05. Thursday's supply and demand report increased projected ending stocks by 5 million bushels, to 72 million.

 

Ethanol futures were mostly lower. May ethanol ended down US$0.020 to US$1.555 per gallon and June ethanol ended flat to US$1.590.