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CME: Corn Futures Closed Higher Tuesday

04 December 2013

US - December Corn finished up 5 1/2 at 422, 1 off the high and 7 1/4 up from the low. March Corn closed up 6 3/4 at 431 1/4. This was 8 1/4 up from the low and 1 off the high.

March corn closed 6 3/4 cents higher on the day and 8 1/4 cents up from the lows. Traders expected the market to trade lower early today as uncertain demand from China due to GMO issues helped to keep the trade sentiment bearish.

Media attacks on ethanol, high fructose corn syrup and GMO varieties had traders expecting a further slide.

However, the lack of new selling interest early sparked a short-covering trend and the market saw continued strong buying support into the close. The market is up as much as 13 3/4 cents from yesterday's lows.

The COT report, released late yesterday, showed that trend-following fund traders held a net short position of 204,441 contracts as of November 26th which may have helped spark some short-covering support today.

January Rice finished up 0.03 at 15.93, equal to the high and 0.035 up from the low.

Soy Futures Closed Lower

January Soybeans finished down 1 1/2 at 1319 3/4, 9 1/4 off the high and 8 1/2 up from the low. March Soybeans closed down 1 1/2 at 1304 1/2. This was 7 up from the low and 9 1/2 off the high.

December Soymeal closed down 0.9 at 446.1. This was 5.2 up from the low and 3.1 off the high.

December Soybean Oil finished down 0.44 at 39.9, 0.43 off the high and 0.14 up from the low.

January soybeans closed just 1 1/2 cents lower on the day after choppy and two-sided trade with a 17 3/4 cents range.

Futures were down as much as 10 cents lower ahead of the pit opening. Talk of a slowdown in farmer selling after the break yesterday and ideas that short-term demand indications remain very strong helped to support the solid recovery off of the lows.

Weakness in palm oil overnight plus a weak tone to global equity markets and some weakness in China soybeans added to the bearish tone early.

A lack of deliveries against the December meal contract may have helped support the market with January Meal up $2.50 into the mid-session with the market recovering from a 5-session low this morning.

Weather looks favorable for South America crops and more talk of record production from South America this year helped to pressure the market as well and bull spreads in soybeans and meal corrected.

Wheat Futures Closed Higher

December Wheat finished up 4 at 653 3/4, 1 3/4 off the high and 4 3/4 up from the low. March Wheat closed up 6 1/2 at 668 1/4. This was 6 1/4 up from the low and 1 off the high.

March wheat closed 6 1/2 cents higher on the session with a minor short-covering trend in corn helping to support the market. Egypt bought 60,000 tonnes of wheat from Romania for shipment in late December.

This may have limited the strength for the market today but global demand still looks to be on an uptick and this helped to support. In addition, a bounce in soft red basis and talk that the US is competitive on the world market helped to support.

Traders see snow moving into the central and northern US plains and snow in the forecast for Russia as bearish forces. Argentina wheat production was pegged at 8.5 million tonnes by their Agriculture Minister and this is similar to their recent updates but well above the current USDA forecast at 11.0 million tonnes.

Trend following funds held a net short position of 103,925 contracts in the COT report released late yesterday.

This was up 8,394 contracts for the week and is also a new record short position and leaves futures vulnerable to bouts of short-covering. Stats Canada wheat production estimate may impact market Wednesday.

Australia officials pegged their wheat crop at 26.21 million tonnes as compared with 24.47 million tonnes as the September forecast and the USDA estimate at 25.5 million. India is expected to be offering near 650,000 tonnes of wheat in the weeks just ahead.

December Oats closed up 8 at 367 1/2. This was 4 3/4 up from the low and 1 1/2 off the high.

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