20000130

CBOT corn closes lower on a technical sag

CHICAGO: Corn futures at the Chicago Board of Trade closed lower on Friday, as a technical setback from recent gains overshadowed stronger export readings, traders said.

Corn closed 1-3/4 to 2-1/4 cents lower, with March down 2-1/4 at $2.23-1/2.

The corn market's run to four-month highs earlier this week left it in an overbought condition technically, traders said, and some pullback was warranted.

Futures gains on Thursday prompted a pickup in US farmer corn selling in cash markets, merchants said, but grain movement slowed by early Friday. Cash corn bids were mostly steady to in some locations lower.

Commodity funds were heavy buyers in corn over the past two weeks, and were believed to hold a net long position in corn futures of at least 100,000 contracts.

Price declines were limited by signs of improving export demand.

The US Department of Agriculture's weekly export sales report listed net US corn sales for the week ended Jan. 20 at 1.133 million tonnes, equal to the previous week but up 86 percent from the four-week average. Expectations ranged from 750,000 to 1.1 million tonnes.

Japan, at 412,500 tonnes, was the largest corn buyer for the latest week, the USDA said. "Unknown destinations" bought 337,000 tonnes. TENCO Commercial Grain sold 300 March, Iowa Grain sold 200 May, Term Commodities bought 100 each in March, May and September and 300 July and Cargill Inc. bought 200 each of March, May, July and December. ABN AMRO sold 1,000 March and Goldenberg Hehmeyer sold 1,200 December.

Corn futures volume was estimated by the CBOT at 42,000 lots, below the 71,449 lots traded Thursday.

Corn options volume was estimated at 12,000 lots.-Reuters