Rough rice futures at the Chicago Board of Trade closed higher on Tuesday in a technical correction from Monday's steep declines, traders said.
Locals and commercials were buyers while funds were mostly absent after selling the market heavily on Monday and pushing prices to 3-1/2 month lows. Most-active May rice closed up 15-1/2 cents at $8.22.
March rice, which expires on Wednesday, closed up 14 cents at $8.02 per hundredweight, after dipping below $8 on Monday for the first time since December. Volume was estimated by the exchange at 943 futures, down from 1,704 on Monday, and 115 options.
Short covering by locals lifted prices in the session, while commercial buying by Man Financial added support, a floor source said. RJ O'Brien, Catkin Arbour Inc and ADM Investor Services sold May rice above $8.20, the trader said.
Traders also noted light buying in November rice by Man Financial and Reface-Man. There were two deliveries against the March rice contract, issued by a Dowdy Weskit customer. The ADM house account stopped both lots. After the markets closed, the US Agriculture Department said it left its weekly world market price for world rough rice unchanged at $6.50 per cwt.
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