August 31, 2007

 

CBOT Corn Review on Thursday: End mostly lower, unable to maintain gains

 

 

Chicago Board of Trade corn futures settled lower Thursday despite sharply higher wheat values and stronger soybean prices, analysts said.

 

Sept. corn settled unchanged at US$3.22 3/4 per bushel, Dec. slipped 1/2 cent to US$3.39 3/4 and March declined 1 cent to US$3.56.

 

Corn acted sluggishly, said Jason Britt, an analyst at Central States Commodities in Kansas City, Mo. It took wheat to go limit up and soybeans to trade 15 cents higher in order for corn to move higher, said Britt.

 

CBOT Sept. wheat settled 28 cents higher at US$7.70 per bushel and Sept. soybeans settled 12 cents higher at US$8.70 1/2.

 

Trading was two-sided and choppy with corn rallying to its highs after spot month CBOT Sept. wheat traded 32 cents above Wednesday's settlement price as price limits in the spot month are removed on first position day.

 

However, there was little else to support corn, and when wheat was unable to hold at the day's highs, selling emerged in corn with the market retracing its gains, an E-CBOT trader said.

 

Early harvest reports are noting better than expected yields and with supplies expected to be ample, it's hard for corn to trade higher right now, the trader said.

 

Better-than-expected weekly corn export sales had little impact. The U.S. Department of Agriculture reported weekly corn export sales totaled 1.606 million metric tonnes, well above the 700,000-1.2 million tonnes expected by analysts. Included in the total were sales of 173,000 tonnes for delivery in the 2006-07 crop year.

 

Price direction on Friday will depend upon what happens with wheat as well as month-end position squaring ahead of the long weekend, an analyst said.

 

On daily technical charts, electronically traded December had an "outside day" but settled below its major moving averages. In open auction trading, Fimat bought 2,000 Dec. and Penson GHCO sold 1,500 Dec.

 

In options trading, FC Stonnee bought 1,500 Dec. US$4.30 calls and sold 1,000 Oct. US$3.15 puts.

 

Oat futures settled little changed after trading to the upside earlier in the session. Oat prices were supported by early fund buying based on the rally in wheat futures, an analyst said. But as the fund buying subsided, oats were unable to hold their gains, the analyst said.

 

Sept. oats slipped 3/4 cent to US$2.38 1/4 per bushel, Dec. gained 1/2 cent to US$2.52 3/4, and March ended unchanged at US$2.63 3/4.

 

Ethanol futures settled lower in light activity. Sept. ethanol declined 2.9 cents to US$1.69 per gallon and Oct. fell 5.1 cents to US$1.58.