May 16, 2013
Chicago Board of Trade corn futures fell on Tuesday on profit-taking and expectations that US farmers will make significant planting progress this week, traders said. “There is some optimism with planting progress,” said Ken Smithmier, analyst at the Hightower Report in Chicago. “We have a well-advertised storm system moving in by late this week. The farmer is well aware of that, and he is going to try to get as much done as he possibly can until he starts seeing raindrops on the windshield,” Smithmier said.
Bruce Rowher, a producer from Paullina, Iowa, who is president of the Iowa Corn Growers Association, concurred. “It’s pretty frantic in our area as everyone is pushing hard to get as much planted before the next round of precipitation,” Rohwer wrote in a planting update Tuesday.
At the CBOT, most-active July corn ended down 3 cents at $6.52-1/2 per bushel and July soyabeans settled down 4-1/2 cents at $14.14-3/4 a bushel. Wheat edged higher while staying inside of Monday’s trading range. CBOT July wheat ended up 1 cent at $7.10-3/4 a bushel. Both corn and soyabeans retreated after hitting chart-based resistance levels. The benchmark July soyabean contract fell back from a six-week high set early in the session.
However, new-crop November soyabeans ended higher as traders exited long July/short November spread positions, following the midday expiration of CBOT May contracts. The July soya contract gained against November for most of this month, supported by strong cash markets, dwindling supplies of old-crop US soyabeans and the absence of deliveries against the May contract.
Ahead of its expiration Tuesday at 12:01 pm CDT (1701 GMT), May soyabeans surged to $15.45 a bushel, the highest spot soyabean price on a continuous chart since November 2. The contract pared gains to settle at $15.24-1/2. After May expired, traders took profits on July/November soyabean spreads as well as July/December corn and soyameal spreads.
“The feeling was that once the May went off the board, you can relax that stuff for a bit. I think everybody believes the May was going to be biggest as far as fireworks for this year,” said Charlie Sernatinger of ED&F Man Capital in Chicago. The CBOT has reported no deliveries of soyabeans, corn or soyameal so far during the May delivery cycle, a sign that commercial grain handlers see more value in selling into the firm cash market than in delivering against futures.Reuters