CattleNetwork.com, KS
05-03-07
CBOT Corn Review: Higher On Forecast, Speculative Buying
CHICAGO (Dow Jones)--Chicago Board of Trade corn futures finished higher
Thursday but down from highs established earlier in the session on concerns
about the potential for planting delays due to wet weather in parts of the U.S.
Midwest.
May corn gained 7 3/4 cents to $3.79 3/4 per bushel, July settled 7 1/4 cents
higher at $3.89 1/4, and December gained 7 cents to $3.87 1/4.
"It's an emotional market and corn is at the top of its recent trading range," said
Don Roose, president of U.S. Commodities in West Des Moines, Iowa.
July corn has rallied over 20 cents since Monday.
The market is concerned about the impact on the crop's overall yield if a large
amount of corn is planted later than normal, Roose said.
A study done by Iowa State University Extension shows planting after May 15
leads to potential yield declines, as corn will pollinate during the hottest part of
the summer.
Hot weather during pollination can adversely impact the size and number of
kernels on an ear, negatively impacting yield.
The weather remains the feature with speculative fund and technical buying
adding to the gains, a commission house analyst said.
Fund buying was estimated at 14,000 contracts.
Mid-day weather forecasts had little impact on late trading with several
forecasters reducing rain for the eastern U.S. corn belt and increasing rain
amounts expected in the western corn belt this weekend.
Unless the overnight outlook adds additional rain into the forecast, corn could
see some consolidation ahead of the weekend and after the rally thisweek, the
floor analyst said.
On daily open auction technical charts, July settled above its 10-day and 20-day
moving averages and right at its 40-day moving average.
In open-auction trading, buyers included Rand, which bought 4,000 December,
and UBS, which bought 900 December.
In options trading, Rand bought 1,000 June $4.00 calls and sold 1,000 July $4.60
calls.
Oat futures finished higher on spillover from corn in light trading as oats lacked
their own feature, a commission house analyst said.
May oats settled 3 cents higher to $2.66 per bushel and July rose 2 1/2 cents to
$2.71 1/2.
Ethanol futures finished higher in modest activity with May gaining 4.7 cents to
2.25 per gallon with June ethanol up .007 cents to $2.148.
Source: Joe Poncer; Dow Jones Newswires; 312-341-5778;
joe.poncer@dowjones.com