Corn futures at the Chicago Board of Trade ended lower on Tuesday on quiet exports and signs that the market is technically overbought, traders said.
Recently improved crop weather in the US Midwest also pressured the market as did talk that China may resume exporting corn, they said.
CBOT corn closed 1/4 to 2-1/4 cents per bushel lower, with May down 2 at $2.34-1/2 per bushel.
Traders and analysts said the abundant supply of corn continued to rein in occasional rallies in CBOT corn futures prices. And there are prospects for a good corn crop this year in the United States, despite an expected reduction in acreage. Recent rains in the US Midwest have improved soil moisture reserves and buoyed prospects for seeding this year's crop. But demand for corn remains brisk, a scenario that is expected to cut into the stocks of feed grains, including corn, for the new crop marketing year that begins on September 1.
Weather in South America is satisfactory for harvest of the corn and soybean crops there. Volatility in the corn futures market, following Friday's surge to eight-month highs, prompted the CBOT to raise margins effective with Tuesday's electronic night session. The initial margin was raised to $473 from $338 per contract.
Traders said the increase in costs to trade corn also weighed on prices.
Volume was estimated by the exchange at 116,266 futures, down from 196,211 on Monday, and 40,015 options.
Exports were quiet overnight. Traders said the US FOB Gulf basis for corn was weak amid a slowdown in export demand and softness in the barge market.
Technical traders were eyeing the nine-day relative strength index for May at 69. They view a reading of 70 or higher as indicating an overbought market.
May remains well above all key moving averages, with first major support at its 200-day moving average of $2.31-1/2 per bushel. First near-term support was at $2.35, with resistance at $2.38-1/2.
Cash basis bids for corn in the Midwest on Tuesday were mixed and farmer selling was slow as they held out for higher prices before booking new sales.
Oat futures closed 1 cent per bushel lower to 1 cent higher, with May unchanged at $1.73-1/2.
Oats volume was estimated at 880 futures and 34 options.
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