November 7, 2009

 

CBOT Corn Review on Friday: Lower on good weather, crude, soy

 

 

Pressure from crude oil, soy and an improved harvest outlook sent Chicago Board of Trade corn futures lower Friday.

 

December corn ended down 9 1/2 cents to US$3.67 per bushel, and March corn ended down 9 1/4 cents to US$3.81.

 

Funds sold an estimated 7,000 contracts as the market settled near the bottom of the day's range. The market salvaged a higher weekly close, but just barely, touching last week's close of US$3.66 before rebounding slightly.

 

Sharply lower crude oil weighed on corn and was just one of many commodities weaker on the day. Soy also continued to sag, thanks to increasing harvest pressure.

 

Corn is feeling that pressure also, but not as much as it is likely to next week, traders said.

 

"We're going to get a lot of harvesting done," said Chad Henderson, analyst with Prime Ag Consultants. "By end of next week, the beans will be all harvested, and the corn will be a slow grind for the next four weeks."

 

This week's dry, warmer weather has been bearish, as are forecasts showing mostly dry weather well into next week.

 

The trade is looking ahead to Tuesday's reports on crop production and supply and demand, which will be released at 8:30 a.m. EST.

 

"Sunday night and Monday morning will likely bring some initial weakness as commercial traders cover harvest purchases made over the weekend, but then we could very well see some short-covering strength emerge as traders position for Tuesday morning's USDA crop report, assuming the outside markets have stabilized by that point," Farm Futures analyst Arlan Suderman said.

 

A floor trader said the close for the week "doesn't look real positive," and that it will be tough to generate any upside momentum as the harvest picks up.

 

But the pace of the corn harvest still might be sluggish, some analysts said, thanks to an abundance of wet corn that needs to be dried.

 

CBOT oats futures ended lower. December oats ended down 1 3/4 cents to US$2.54 per bushel and March oats ended down 1 3/4 cents to US$2.67 1/2.

 

Ethanol futures were lower. December ethanol ended down US$0.015 to US$1.852 per gallon and January ethanol was down US$0.024 to US$1.821.