December 29, 2005

 

CBOT Corn Outlook on Thursday: overnight, holiday trade

  

 

Corn futures at the Chicago Board of Trade are predicted to begin open outcry trading Thursday at slightly lower levels as weaker prices overnight and the absence of fresh news ahead of the holiday will likely limit activity, sources said.

 

In overnight e-CBOT trading, March corn slipped 3/4 cent to US$2.15 1/2 per bushel, May corn declined 1/2 cent to US$2.24 1/2, and July corn edged 1/4 cent lower to US$2.32 3/4 per bushel.

 

Corn should start out a little lower based on the overnight trade with the market in a holiday mode as today is the last full trading session of the year, a floor trader said. The funds have been supporting corn all week and if they come back this morning, the market should see some support, he added.

 

Since making a new contract low in mid-December after the release of the supply/demand report from the U.S. Department of Agriculture, March corn futures have been slowly grinding their way higher, underpinned by technical and fund buying, traders said.

 

In Argentina, mostly dry conditions are forecast through the weekend in Cordoba, Santa Fe and Northern Buenos Aires, with dry conditions forecast in La Pampa and Southern Buenos Aires over the next several days with scattered showers over the weekend, DTN Meteorlogix weather said.

 

Cash market basis bids are unchanged to lower Thursday morning. Central Illinois was unchanged at 3 cents over the March future, while St. Louis was 5 cents lower at 1 cent under the March future.

 

On technical charts, analysts peg the next major technical objective at US$2.20 in March futures, with first resistance seen at US$2.17 and then at US$2.20 1/4. First support is pegged at US$2.13 1/4 and then at US$2.10.

 

In other agricultural news, China's total grain harvest is expected to reach a record 484 million metric tonnes in 2005, government media reported Thursday, up 3% from the 2004 record of 469.5 million metric tonnes, the state-run newspaper China Daily reported.

 

Corn futures at China's Dalian Commodity Exchange settled mostly higher, sources said. The most-active September contract gained RMB3 to RMB1,384/tonne.