US corn futures turned lower early on Thursday in a profit-taking setback after the rally early this week to record highs, traders said. A steep slide in soyabeans and volatile dealings in gold and crude oil after record highs were notched late this week also triggered some speculative selling in the corn market, they said.
At 10:05 am CST (1605 GMT), Chicago Board of Trade corn was down 2-1/2 to 4-1/4 cents per bushel, with March down 4-1/4 at $5.53 per bushel. Traders and analysts said a profit-taking technical setback such as the one occurring on Thursday should be expected because commodity markets, including corn, had been boosted into overbought levels on technical charts.
However, "if funds keep buying it, we're going higher," a trader said. Traders and analysts said big money was flowing out of equities into commodities, driving grain markets, including corn, to higher price levels. The deferred corn futures contracts were closing in on $6 per bushel and the July contract rallied to a record high $5.95 per bushel on Tuesday. Brazil's corn crop was revised up to 55.3 million tonnes from 53.6 million, according to Conab, the government's National Crop Supply Agency.
The focus on crop weather is in Argentina, the No 2 global corn exporter behind the United States. Mostly favourable crop weather was seen for Argentina, with adequate soil moisture and no hot weather, DTN Meteorlogix said on Thursday.
Technical traders were watching the March contract trade above all key moving averages, with support at the 20-day moving average of $5.23 per bushel. The nine-day relative strength index was at 66 and traders view an RSI of 70 or more as one indication of an overbought market. Oat futures were 3-1/2 to 7 cents per bushel lower, with May down 7 at $4.21 per bushel.
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