A light amount of short-covering after the drop late last week to one-month lows boosted Chicago Board of Trade corn futures to a firm close on Monday, traders said. Gains in the soyabean market also led to some spillover speculative buying of corn futures, they said.
CBOT corn closed up 1-1/2 to 2-3/4 cents per bushel, with September up 1-3/4 at $2.39 per bushel. New-crop December was up 1-3/4 at $2.55-1/4 per bushel. Volume was on the light side, estimated by the exchange at 112,548 futures and 24,176 options. That compared with the 190,972 futures that traded on Friday.
Crop weather is still important for the corn futures market. However, the US corn crop in the Midwest is virtually pollinated, leaving it less vulnerable than soyabeans to harm from hot weather. The US soya crop is entering its key pod-setting stage, leading to concern about harm from a heat wave.
Hotter weather is expected by late this week and over the weekend in the western Midwest crop region, a private forecaster said on Monday. A moisture-robbing and heat-producing high pressure atmospheric ridge that is currently in the far west will move into the central Midwest by Friday and Saturday, he said.
"By Friday or Saturday it should be over Nebraska and Kansas," said Meteorlogix forecaster Joel Burgio. After the markets closed, the USDA said 59 percent of the US corn crop was rated in good to excellent condition, down three points from 62 percent the previous week.
Traders had mixed expectations ahead of the ratings. Showers and milder temperatures last week in the Midwest were expected to aid corn crops in some areas, but a pocket of dryness and some heat in the west was seen trimming ratings, they said.
USDA on Monday said exporters sold 221,488 tonnes of US corn to Japan and over the weekend, and South Korea bought up to 165,000 tonnes of optional-origin corn for feed production. Trade sources in Seoul said the corn likely would come from the United States. And, early Monday, USDA said 50 million bushels of corn were inspected for export last week, above trade estimates for 43 million to 48 million bushels.
Technical traders saw the September contract Friday close below all key moving averages and near oversold levels with its nine-day relative strength index at 33. Chart watchers view an RSI of 30 or less as an oversold market. Technical support in the September contract was at $2.35-1/4 per bushel and resistance was at $2.41.
Cash basis bids for corn were mostly steady to firm in the Midwest amid slow country movement following a decline in prices last week.
Friday's CFTC Commitments of Traders report for futures and options combined showed that as of last Tuesday, large speculators were long 291,812 contracts, down 7,371 from the previous week and short 80,085 contracts, down 30,353 lots. Oat futures closed unchanged to 2-1/2 cents per bushel higher, with September up 2-1/2 at $1.92-1/4 per bushel. Oats volume was estimated at 653 futures and 29 options.