Corn Futures End Lower Amid Technical Selling and Bearish Fundamental Outlooks

Strategic Insights -

The Chicago Board of Trade (CBOT) corn futures ended lower on March 18, 2005, following the lead of soybeans, with technical selling and bearish long-term fundamental outlooks contributing to the downward movement. The CBOT May corn contract settled 3 3/4 cents lower at $2.19 3/4, while the July corn contract ended 3 4/3 cents lower at $2.27 1/2. The December corn contract finished 2 cents lower at $2.43 per bushel. Independent agricultural consultant John Kleist attributed the price movement to the natural path of futures lower without any supportive outside influences.

Key Takeaways:

  • The CBOT May corn contract settled 3 3/4 cents lower at $2.19 3/4 on March 18, 2005.
  • July corn ended 3 4/3 cents lower at $2.27 1/2, while December corn finished 2 cents lower at $2.43 per bushel.
  • Independent agricultural consultant John Kleist stated that the price movement was driven by the market's technical orientation without a fundamental catalyst to drive the market.
  • Bearish traders were encouraged by the May contract's ability to settle below its 10-day moving average at $2.20 3/4.
  • Strong export competition, abundant nearby supplies, and increased corn planted acreage in 2005 contributed to the defensive slant on the market.
  • Informa Economics Inc. estimated 2005 U.S. corn planted acreage at 82.779 million acres, a 2.3% jump from last year's planted acreage of 80.930 million.
  • Speculative profit-taking and technical selling were featured attractions in relatively quiet trade, with a breather from the pace of trading over the past few weeks.

Statistics:

  • CBOT May corn contract settled 3 3/4 cents lower at $2.19 3/4.
  • July corn ended 3 4/3 cents lower at $2.27 1/2.
  • December corn finished 2 cents lower at $2.43 per bushel.
  • Informa Economics Inc. estimated 2005 U.S. corn planted acreage at 82.779 million acres.
  • 2005 corn planted acreage increased by 2.3% from last year's planted acreage of 80.930 million.
  • Commodity funds were estimated sellers of 4,000 contracts.

Sources:

  • (Dow Jones)--Corn futures on the Chicago Board of Trade ended on a lower note, following the lead of soybeans, with technical selling a featured attraction in relatively quiet trade.
  • (Dow Jones)--The price movement of soybeans remained the leadership of the market, with the natural path of futures lower without the benefit of any supportive outside influences, said independent agricultural consultant John Kleist.
  • Informa Economics Inc.--Estimated 2005 U.S. corn planted acreage at 82.779 million acres.
  • COMTEX (http://www.comtexnews.com)--News Provided by COMTEX.