Corn futures at the Chicago Board of Trade fell Monday on prospects for a larger-than-expected US harvest, traders said. The advancing southern Midwest harvest was also bearish as more supplies were moving to marketing channels there.
"There's concern about soy yield and the market is confident about corn," said one CBOT floor broker referring to the firmer close in soy and the weakness in corn. The market slid below its 10-, 20- and 50-day moving averages and closed below its 50-day MA.
Underpinning prices was continued strong demand for feedgrains globally given the short supply of wheat and prices at an 11-year high. September corn closed 5-3/4 cents per bushel lower at $3.35-3/4. New-crop December ended 5-3/4 weaker at $3.53 - below key resistance at its 50-day MA of 3.55.
Volume was moderate with a good portion of the futures trade made overnight. An estimated 152,683 futures and 25,571 options traded, compared to 137,405 futures and 29,301 options traded Friday. Commodity funds sold about 4,000 contracts, with most of the flurry in the first 30 minutes. Then trade quieted down.
The weak trend in corn began overnight in reaction to a bigger-than-expected US crop forecast following the US Midwest crop tour last week. Farm newsletter Pro Farmer late Friday pegged the 2007 US corn crop at 13.109 billion bushels, with an average yield of 153.47 bushels per acre, The group used the information from the tour with other data in coming up with its crop forecasts. Pro Farmer's crop estimate was bigger than USDA's August forecast for a record 13.054 billion bushels, with a yield of 152.8 bpa.
The condition of the crop improved over the past week. USDA late Monday rated 59 percent of the corn crop good to excellent, up from 58 percent the week before. Traders expected USDA to report weekly crop conditions for corn as steady. USDA early Monday confirmed the sale of 120,000 tonnes of US corn to Egypt for 2007/08 delivery.
Brazil's corn exports could reach a record 10 million tonnes this year as demand from the European Union has been intense since July, traders said on Friday. The supplement to the CFTC's reports on Friday showed large speculators widened their net long in CBOT corn to 111,676 contracts as of August 21, up 2,000 lots.
CBOT oat futures were 3-1/2 to 4 cents per bushel, breaking the weak trend in other Chicago grain markets due to active fund buying and limited commercial selling. September ended up 1/2 cent at $2.47-1/2 per bushel and December closed 3-1/4 higher at $2.60-3/4.
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