Corn futures at the Chicago Board of Trade rallied 7 percent on Monday to a fresh two-year high and new contract highs following a limit-up surge in wheat to 10-year highs amid shrinking global stocks of wheat, traders said.
Good demand for corn from the export, livestock and ethanol sectors also continues to give corn futures some buoyancy, and analysts have said that global feed grain stocks likely would fall to the lowest level in 30 years near the end of next year. CBOT corn closed up 18-1/2 cents per bushel to down 1 cent, with December up 18-1/2 at $2.89-1/2 per bushel.
Traders said fund buying totalled 18,000 lots. Gains in corn futures were limited by increased country movement during the strong rally and outlooks for continued harvesting of a big US corn crop.
Meteorlogix weather on Monday said colder and wetter weather over the next week would cause some harvest delays but this does not appear to be the start of a wet pattern. US farmers are busy harvesting what may be the second-largest corn crop ever.
Exports were quiet over the weekend but traders continue to monitor the overall brisk pace of US corn export sales amid prospects for dwindling global stocks of feed grains through the 2006/07 marketing year. Cash basis bids for corn in the Midwest on Monday were mostly steady as the advancing harvest made more grain available for processors and elevators.
Friday's CFTC commitments of traders report for futures and options combined showed that as of last Tuesday large speculators were long 297,525 lots, up 5,601 from the previous week, and short 94,251, down 19,116 lots.
The December contract is well above all key moving averages, with first key support at its 200-day MA of $2.59 per bushel. The nine-day relative strength index at 78 was into the overbought range of 70 and higher. Oat futures closed 3 to 10-3/4 cents per bushel higher, with December up 10-3/4 at $2.27 per bushel.
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