December 6, 2005

 

CBOT Corn Review on Monday: Ends up on spec buying, firm cash

 

 

Chicago Board of Trade corn futures ended higher Monday, but below session highs, on active speculative buying and short covering despite commercial sales, brokers said.

 

Support was also seen from speculation that index fund monies may in early 2006 flow into CBOT agricultural markets, as was seen in early 2005.

 

"Locals just seem like they don't want to be short, even though there are thoughts the U.S. Department of Agriculture could cut (its estimates for 2005-06 U.S. corn) exports and increase carryout Friday," one CBOT broker said.

 

The USDA is slated to release its December ending stocks report on Friday.

 

Steady to firm U.S. cash corn basis bids, as frigid U.S. temperatures limited farmer sales, were also supportive Monday, brokers said.

 

Moreover, weekly U.S. corn export inspections of 36.8 million bushels topped analysts' estimates, brokers said.

 

Midday CIF Gulf corn quotes weakened, cash sources said.

 

CBOT March corn settled up 3 1/2 cents at US$2.06 3/4, above its 10- and 20-day moving averages.

 

CBOT December corn ended up 3 3/4 cents at US$1.93 1/2; 996 deliveries were posted against the nearby contract early Monday.

 

Funds bought about 6,000 lots during Monday's open outcry session, led by Calyon's purchase of 1,500 March, brokers said. ADM Investor Services bought a net 1,000 March, Refco Inc. bought 1,000 March and Fimat bought 600 March.

 

Cargill Inc. sold a net 1,900 March, brokers said.

 

In options trade, ABN bought 1,500 March US$3.10 call options, they noted.

 

Oat futures settled higher Monday in nearby contracts and lower in deferreds. Bellwether March ran to a new contract high amid CBOT floor-wide speculative buying Monday, traders said.

 

The December oats contract ended up 6 cents at US$2.10, while the March oats contract rose 5 cents to US$1.95 3/4 after setting a new contract high of US$1.96 per bushel. Ethanol futures settled mixed, with the January contract up 1 cent at US$1.88 1/2 cents per gallon.