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CME: Corn Futures Closed Lower Monday

01 November 2011

US - December corn put in the low in the first hour of trade and saw a 9 cent recovery bounce off of the lows to close moderately lower on the day.

December Corn finished down 8 at 647, 8 3/4 off the high and 9 up from the low. March Corn closed down 8 at 659. This was 9 1/4 up from the low and 8 1/4 off the high.

Outside market forces contributed to the early weakness and a long liquidation selling trend from fund traders pushed the market into new lows early as fears of liquidation pressures due to the possible bankruptcy of a major brokerage firm plus a sluggish export outlook helped to pressure.

Export competition for US corn is on the rise and good weather for planting season in South America plus surge in availability of exportable surplus corn from the Black Sea region has traders concerned with export demand.

Weekly export inspections came in at 27.7 million bushels which was near the low end of expectations and compares with 34.5 million bushels necessary each week to reach the USDA projection.

Traders see harvest near 78-80 per cent complete for this afternoon's weekly update.

Funds were noted sellers for the session and commercial traders were buyers on the early break.

Wheat Futures Closed Sharply Lower

December Wheat finished down 16 1/4 at 628 1/4, 19 3/4 off the high and 9 up from the low. March Wheat closed down 16 at 664 1/2. This was 9 up from the low and 19 off the high. D

ecember wheat closed sharply lower on the session but managed to bounce 9 cents off of the early lows. The sharp rally in the US dollar and weakness in metal and energy markets helped to pressure wheat early in the day.

Traders have less confidence that the euro debt crisis has ended and US economic news was sloppy.

Weekly export inspections came in at 20.8 million bushels which was near the high end of the trade expectations and this compares with 18.3 million bushels necessary each week to the USDA projection.

Parts of the southern plains could see more rain later this week (mostly east) which will help lower moisture deficits for the region.

Talk that excess moisture in Ohio could cause planted winter wheat areas to decline significantly helped to provide some underlying support.

Fears of further selling on the uncertainty surrounding a large clearing firm helped to add to the bearish news early but this concerned diminished during the session.

Egypt tended for optional origin wheat after the close and traders will be monitoring pricing of the tender in the morning.

Soybean Futures Closed Lower

January Soybeans finished down 8 3/4 at 1217 1/4, 11 3/4 off the high and 13 3/4 up from the low. March Soybeans closed down 8 3/4 at 1227. This was 13 1/4 up from the low and 11 1/2 off the high.

December Soymeal closed down 1.4 at 316.1. This was 3.8 up from the low and 1.9 off the high.

December Soybean Oil finished down 0.6 at 51.17, 0.56 off the high and 0.55 up from the low.

January soybeans fell sharply early in the day but the market still managed to recovery late in the session to close just moderately lower on the day.

Bearish outside forces and continued concerns with the export outlook helped to pressure the market early in the day. These negative forces plus higher than expected deliveries (741 contracts) pushed November soybeans to the lowest level since October 11th before support emerged just under 1194 and closing back up at 1207 1/2.

On top of other news, traders are nervous over the potential bankruptcy of a major clearing firm and this has added to the long liquidation selling trend.

Weekly export inspections came in at 48.5 million bushels which was higher than expected and compares with just 27.3 million bushels necessary each week to the USDA projection.

Traders see harvest near 88-90 per cent complete for this afternoon's weekly update. South America weather looks favorable to active planting ahead.


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