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CME: Corn Futures Closed Higher Friday

21 May 2012

US - July Corn finished up 10 1/2 at 635 1/2, 3 off the high and 16 up from the low. December Corn closed up 8 3/4 at 537. This was 15 up from the low and 5 1/2 off the high.

December corn took over as the leader for the first time in a long time as a less than perfect weather outlook and some second-guessing on using a record yield helped to support.

July corn opened 6 cents higher on the session but found strength from wheat and strong cash markets to drive sharply higher and pushed to the highest level since April 10th. A continued firm cash market and some continued uncertainty over a generally warmer and drier outlook for portions of the Midwest helped to support.

In addition, a more positive tilt to outside market forces with a jump in wheat and gold prices and a firm tone to the US equity markets helped to support. After closing at 581 last week, July corn closed sharply higher on the week. July Rice finished down 0.09 at 15.175, 0.005 off the high and equal to the low.

Soybean Futures Closed Lower

July Soybeans finished down 33 at 1405, 33 3/4 off the high and equal to the low. November Soybeans closed down 18 1/2 at 1288. This was equal to the low and 29 1/2 off the high. July Soymeal closed down 10.1 at 417.9. This was 0.9 up from the low and 12.9 off the high. July Soybean Oil finished down 0.4 at 50.32, 0.52 off the high and 0.29 up from the low.

July soybeans sold off sharply Friday but still managed to close 1cent higher on the week. Funds were noted as unwinding long soybean short wheat and short corn spreads, and this helped support the other grains and pressure soybeans. November soybeans stayed in a choppy range into mid-session, as the market seemed to find support from the dry weather forecast, but a new round of selling emerged this afternoon, which send the market sharply lower.

The jump in wheat provided some early support, but the market drifted lower to trade moderately lower on the session into the mid-session. Further weakness in China and ideas that the China economy may suffer short-term with so much uncertainty coming out of Europe has helped to spark some long liquidation selling recently, and news that China plans to offer 600,000 tonnes of soybeans from state reserves next week which could help to slow the short-term import demand helped to limit the advance.

Ideas that the rally Thursday was a bit overdone added to the negative tone. July meal pushed sharply lower after surging to its highest level since May 2nd Thursday, while July oil pushed moderately lower, to its lowest level since December 16th to 50.03 before a bounce off of the lows. Traders believe there needs to be some progress in Europe over the weekend and early next week, otherwise macroeconomic weakness could continue to pressure the market next week as well.

Wheat Futures Closed Higher

July Wheat finished up 37 1/2 at 695 1/4, 2 1/4 off the high and 42 3/4 up from the low. December Wheat closed up 31 1/4 at 720. This was 36 1/2 up from the low and 5 1/4 off the high. July wheat capped off a strong up week with a surge higher on the day.

European milling wheat futures surged more than 5 per cent to see 11-month highs. The late call was just 3-5 cents higher so the market found strong buying again early in the session Friday to drive the market sharply higher on the day into the mid-session pushing to the highest level since February 3rd. The market was up as much as $1.05 1/4 from Monday's lows.

Weather concerns for western plains in the US and portions of Ukraine and Russia for next week helped spark the buying and short-covering has emerged again to help support. Outside market forces were somewhat positive with a little more stability in the US equity market and a strong gain in gold and corn helping to provide some support. July Oats closed up 1 1/2 at 340. This was 5 up from the low and 1 off the high.

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