Corn hits four-month high

Corn prices rose on Monday due to technical buying and tight supplies while soya and wheat slipped in choppy trading ahead of a US government crop report later in the week. Weaker equities, due to China indicating slower growth ahead, weighed on all three crops, while a slightly lower US dollar underpinned the grains.
Chicago Board of Trade May corn gained 0.9 percent, or 5-3/4 cents, at $6.60-3/4 a bushel. The nearby March contract, in delivery mode, rose to a four-month high and broke key resistance at its 200-day moving average, drawing technical fund buying to the grain. Most active May CBOT soyabeans slipped 0.6 percent, or 8 cents, on technical selling to $13.25 a bushel, halting a 10-day rise.
"What it tells you is that beans have come a long way versus corn over the last month or two," said Jerrod Kitt, analyst at The Linn Group in Chicago. "And that's really what's helped sustain corn (on Monday) relative to the rest." US growers should harvest a record 13.916 billion bushels of corn this year and 3.243 billion bushels of soyabeans, a University of Missouri think tank projected.
The Food and Agricultural Policy Research Institute said a mammoth corn crop "should allow some stock rebuilding that would moderate prices." But Kitt said the institute's estimate for 93.5 million acres (37.8 million hectares) of corn planting this spring was at the low end of expectations and underpinned corn prices.
The institute also reported larger-than-expected US soyabean supplies and smaller corn stocks at the end of the upcoming crop year, said Mike Zuzolo, grains analyst at Global Commodity Analytics. Adding further support to corn was a forecast for wet weather in parts of the US Midwest that threatens to slow planting this spring, he said. "The corn bears that have been pressing the market are a little more nervous now that this might be a weather pattern change right at the time you don't want it."
Soyabeans had gained nearly 5 percent in the two-week run up to Friday, driven by robust demand for US soyabeans by top importer China, coupled with falling projections of output from rival exporter Brazil. Chicago May wheat slipped 2-1/2 cents to $6.72 a bushel on profit taking and position squaring ahead of the USDA report.