CBoT corn jumps

A strong 2 percent surge in soya helped lift Chicago Board of Trade corn futures to a higher close on Friday as investment funds returned to the buy-side in CBoT ag futures, traders said.
"Funds are buying beans and bean oil, they want to talk about buying bean acres and dry weather in Argentina but this is just a case of money coming in," said Paul Haugens, vice president of FIMAT Futures. "Wheat and corn just followed beans," he said.
CBoT corn closed up 2 to 5 cents per bushel, with March up 4 at $4.02 per bushel. New-crop December was up 4-3/4 at $3.97-1/4 per bushel. Traders said funds bought 4,000 lots. Volume was estimated by the CBoT at 179,959 corn futures and 62,733 options. Some traders said a sharp rebound in crude oil markets aided the advances in corn since corn and ethanol are now closely linked to the energy market.
Traders and analysts were impressed with the ability of corn to bounce from key technical support around the $3.96 per bushel mark, a three-week low and the lowest price level for that contract since the bullish corn production and stocks numbers released by the USDA on January 12.
Brisk demand for corn from the export, livestock and ethanol sectors continues to keep sellers wary. But the market is loaded with a huge long speculative position which makes it difficult for corn futures to sustain rallies. US farmers plan to plant a huge number of acres to corn this year to meet the demand from the ethanol sector and cash in on the highest corn prices in 10-years.
A farmer survey conducted by Iowa-based marketing advisory service ProFarmer pegged 2007 US corn acres to total up to 90 million, the most in 60 years and almost 12 million more than 2006. The survey also indicated soya bean acreage in the United States could drop as low as 66 million, or roughly 9-1/2 million down from last year.
"It's a survey result. It's important to understand that you can make numbers do whatever you want and we assumed 2 to 4 million acres would come into corn from outside of the corn belt," said Chip Flory, ProFarmer editor. Flory said the survey was based on responses from 23 states and the average farm acreage per response was 1,870. Oat futures closed 1 cent per bushel higher to 1 lower, with March up 1 at $2.58 per bushel. Oats volume was estimated at 1,546 futures and 116 options.