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CME: Corn Futures Closed Higher Tuesday

29 February 2012

US - May Corn finished up 8 3/4 at 657 1/4, 1/2 off the high and 11 1/4 up from the low. July Corn closed up 8 at 658 3/4. This was 11 up from the low and 1/4 off the high.

May corn closed sharply higher on the session and experienced the highest close since January 11th which was the day before the bearish January USDA reports. Tightness in the cash market and a positive tone from outside market forces supported an early rally during Tuesday's session.

Strong gains in the wheat market were also seen as a positive force for corn prices. In addition, a sharp break in the US dollar and higher trade in metal markets helped to reinforce early gains.

A rebound in US equity markets was also seen as a positive factor for the corn market during the session. Most traders see zero deliveries of corn on first notice day but there are a few who see up to 50. March Rice finished down 0.03 at 14.43, equal to the high and 0.1 up from the low.

Wheat Futures Closed Higher

May Wheat finished up 15 1/2 at 668 1/4, 3/4 off the high and 19 up from the low. July Wheat closed up 16 at 679 1/2. This was 19 up from the low and 1/2 off the high.

May wheat closed sharply higher on the day and near the highs as improving macro-economic sentiment and carryover support from corn and the soybean complex helped to lift prices far above the trading range of the past 21/2 weeks.

News of fairly large snowfall totals for parts of the Northern Plains, as well as ideas that Russia could remain an active exporter on the world market did not lead to pressure during today's session.

A moderate selloff in the US dollar and ideas that fund traders held a record net short position last week when the market was at lower price levels than now may have encouraged talk of further short-covering during the near future.

Most traders see zero deliveries of wheat on first notice day but there are a few who see up to 200. Variable storage rates are attractive and this has kept demand form for warehouse receipts. March Oats closed up 3 at 313 3/4. This was 4 1/4 up from the low and 1 off the high.

Soybean Futures Closed Higher

May Soybeans finished up 10 at 1312 1/2, 2 1/4 off the high and 12 1/2 up from the low. July Soybeans closed up 9 1/4 at 1319 3/4. This was 12 up from the low and 3 off the high.

May Soymeal closed up 5.7 at 349.3. This was 7.2 up from the low and 0.2 off the high. May Soybean Oil finished down 0.06 at 54.8, 0.45 off the high and 0.3 up from the low. May soybeans closed sharply higher on the session as the market lifted up to the highest price levels since September 23rd.

Weakness in the US stock market due to sluggish economic data pressured soybean prices early in the day but the market managed to recover into the mid-day.

Ideas that the market needs to continue moving higher over the short-term in order to draw out cash soybeans from producers as well as enticing producers to shift potential acreage away from corn and to soybeans during the coming US growing season has helped to strengthen the recent uptrend.

Cash basis levels remain firm, which was widely seen to provide additional support for soybean prices. For first notice day, soybean deliveries against the March contract are seen near 0-300 contracts.

Meal deliveries are also seen near 0-300 contracts and oil deliveries are seen near 2,000-4,000 contracts.

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