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CME: Corn Futures Finished Down Tuesday

19 September 2012

US - December Corn finished down 8 at 740, 14 off the high and 1 up from the low. March Corn closed down 8 1/2 at 744. This was 1 1/4 up from the low and 14 off the high.

The corn market traded slightly higher this morning but pressure from sharply lower wheat and soybean markets limited gains for most of the day. The December contract settled near the lows of the day and made a new low for the move into the close. Reports of better than expected yields for some areas of the Corn Belt along with the seasonal tendency for corn to trade lower has forced large traders to take profits. A slightly wetter forecast for areas of Brazil later this week was also seen as a negative factor as it will allow for first crop corn to be planted. Pressure was also seen from weakness in the corn basis across the Midwest. Corn bids fell by 5 cents per bushel in Cincinnati, OH and some basis weakness was seen in specific ethanol processing markets. Despite the increases in cash grain movement, new sales by farmers have halted due to the lower price trend in futures. Most commodities had a negative tone today as the US Dollar traded higher for the second consecutive day.

November Rice finished down 0.345 at 14.945, 0.365 off the high and 0.005 up from the low.


November Soybeans finished down 29 at 1640, 29 off the high and 9 1/2 up from the low. January Soybeans closed down 30 3/4 at 1639 1/4. This was 7 1/2 up from the low and 32 1/4 off the high. December Soymeal closed down 13.4 at 492.0. This was 1.8 up from the low and 12.6 off the high. December Soybean Oil finished down 0.06 at 55.33, 0.39 off the high and 0.61 up from the low.

Reports of better than expected soybean yields in areas of the US Corn Belt along with weaker cash markets in the interior of the US triggered long liquidation for the second day in a row. November soybeans ended the day sharply lower and losses were extended to soybean meal and oil. A slightly wetter forecast for central and northern Brazil later this week added to the negative influence. The rapid pace of maturity of the soybean crop along with the steady harvest pace has prompted heavy cash soybean movement in the short term which added to weaker trade for futures. Cash bids in the Gulf of Mexico were steady to firm on the day due to better export demand after the recent slide in prices. Early support in soybeans was linked to rumors that Taiwan bought US soybean cargos overnight however no confirmation of the trade has been made. The US Dollar traded slightly higher on the day which added pressure to most commodities.


December Wheat finished down 14 1/2 at 863 1/2, 24 1/2 off the high and 2 3/4 up from the low. March Wheat closed down 14 1/2 at 875 3/4. This was 2 1/4 up from the low and 24 1/4 off the high.

December Chicago wheat traded sharply lower into the close as it continued to narrow its premium to corn this week. Kansas City and Minneapolis wheat traded lower as well. Thoughts that US wheat remains at a slight premium to other world origins also favored the bear camp today. The dry weather conditions in the western plains offered limited support with nearly a quarter of the Hard Red Winter wheat growing area trending drier than normal. Australian wheat growing areas in the southeast have received about a half inch of rainfall this week which could ease stress on heading wheat crops. However, the outlook for continued dry weather following this event is supportive to prices. Some traders are expecting major importers to come to market very soon for additional business and traders believe Black Sea may be too expensive when compared to French origin wheat. This added early support to the market but the negative action in corn and soybeans limited gains and profit taking took over. The US Dollar traded stronger for the second day in a row which added to the negative done for wheat.

December Oats closed down 10 1/2 at 374. This was 3 up from the low and 12 1/4 off the high.

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