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Raw sugar futures on ICE set a 30-year high on Tuesday while arabica coffee climbed to a 13-year peak. The sugar market has surged in recent months, with prices more than doubling since May, as expectations for a rise in output failed to materialize due to bad weather, sparking concern over low stocks.
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Corn Technicals from Reuters

 

SINGAPORE, Oct. 14 (Reuters) - The CBOT corn December contract <CZ0> is technically neutral as it is doubtful if the uptrend can continue.

Corn needs to stand above a pivotal resistance at $5.89 to confirm a more explosive rally towards $6.20. On the other hand, a break below the lower channel line and a possible completion of the wave "5" have dimmed the bullish outlook.

A fall below a minor support at $5.67 will limit its loss to the wave "4" trough at $5.54, as the retracement is expected to be shallow.

Corn Technicals from Reuters

SINGAPORE, Oct. 13 (Reuters) - The CBOT corn December contract <CZ0> could climb up higher towards a range between $6.20 and $6.30 per bushel, as an upwards wave "5" is progressing.

The rise from the Oct. 4 low at $4.54-¼   adopted a five-wave mode, with the fiercest part labeled as a wave "3" and a completion of wave "4" at the Tuesday low of $5.54-1/2.

A projection of the wave "5" target is at $6.20, according to a rising channel drawn through the peaks of wave "1" and wave "4", and the troughs of wave "2" and wave "4".

Support is at $5.65-1/2, a fall below which would extend its loss to $5.54-1/2

Corn Technicals from Reuters

SINGAPORE, Oct 11 (Reuters) - CBOT corn will rise to $6.74-½   per bushel over the next four weeks, as the bull run will speed up after the explosive rally sparked by Friday's USDA report.

A strong bull trend has been developing since the Sept. 8, 2009 low at $3.02, with the current wave (3) unfolding towards a bullish target at $6.74-1/2, the 261.8 percent Fibonacci projection level based on the length of wave (1).

The 161.8 percent projection level at $5.44 was just exceeded with a big gap, which characterizes a strong bullish momentum and an explosive wave (3) rally.

Above the current level, minor resistance is observed at $5.96-3/4, the 61.8 percent Fibonacci retracement on the fall from $7.79 to $3.02, and it may not trigger a deep retracement.

A target of $7.79 over the next four weeks could be too aggressive, but it may not be unrealistic to put this forecast slightly beyond one month, say into a two-month time frame.

Grain Prices Limit Up: USDA Forecast

Grain markets have been on a roller coaster since the summer, when Russia banned exports due to drought conditions. Friday, the United States Department of Agriculture (USDA) cut its projection for this year's corn harvest by 3.8%, as reported in the Wall Street Journal.

 

That news was like pouring gasoline on a fire. The grain markets exploded to the upside, closing limit up. Some exchanges place a limit on how high or low prices can trade on a given day. The limit for corn is 30 cents, for wheat 60 cents and for soybeans 70 cents (each penny equals $50).

What limit up means is that trading is halted. Sell orders can be entered, but its like taking a number in a deli. If someone wants to sell, then maybe you'll get your order off. Usually the opposite happens. The buyers rush in and there are still buy orders waiting at limit up prices.

If you got caught short Friday, you couldn't sell your contract and must wait until Monday. On Monday the market could open limit up again, which means that are losing 60 cents on your corn contract. This recently happened in the pork belly market, where the price was limit up for several days.

The problem of grain shortages is worldwide. China is buying about a quarter of our soybean and cotton crops. Corn reserves are the tightest since the mid 1990s. The carryover for corn (what is left over after this year's buying) will be down a whopping 47%.

Already this year corn futures are up 27.4%, wheat up 32.8%, and soybeans up 9.2%. Food processors are already passing on increases to consumers. These market dynamics will not ease up next year. Look for grain prices to remain high and food prices at the supermarket to keep rising.

Corn Heads for Biggest Weekly Advance in Almost Four Months; Soybeans Gain

Corn advanced, heading for the biggest weekly gain in almost four months, on speculation the U.S. may cut its crop estimates after floods and hot weather damaged plants. Rice was poised for the longest winning streak in almost three years. 

December-delivery corn rose as much as 0.5 percent to $5.005 a bushel in Chicago and traded at $5.0175 at 11:49 a.m. Tokyo time. The grain has jumped 7.7 percent this week, the biggest such gain since the week ended June 11.

“Corn was supported by market forecast of a decline in the U.S. crop yields and output,” Toshimitsu Kawanabe, an analyst at Tokyo-based commodity broker Central Shoji Co., said today. The market was also underpinned by Brazil’s lower export forecast and Ukraine’s curb on grain exports, he said.

U.S. production may fall to 12.977 billion bushels from a record 13.11 billion last year, according to a Bloomberg News survey. Yields may drop 5 percent to 156.6 bushels this year, more than the 2.7 percent drop forecast in the survey, according to Farmers National Co., the largest manager of crop land.

The U.S. Department of Agriculture will update its estimates today.

Corn exports by Brazil, the world’s third-largest shipper, may fall next year to 8 million tons from an estimated 9.5 million tons this year because of a smaller harvest, Silvio Porto, a director at the Agriculture Ministry’s crop-forecasting agency, said yesterday.

Ukraine Quotas

Ukraine set quotas on shipments of all grains to ensure food security and cap domestic prices, First Deputy Prime Minister Andriy Klyuev said yesterday. The restrictions may run through the end of this year, he said. Corn exports will be limited to 2 million metric tons and wheat and barley to 500,000 tons each, he said.

The quotas may boost demand for U.S. corn, Jonathan Bouchet, an analyst and trader at OTCex Group in Geneva, said yesterday. The country is the world’s largest barley exporter and fourth- biggest corn supplier, according to the USDA data.

Rough rice for November delivery fell 0.4 percent to $12.75 per 100 pounds after climbing as high as $12.88 yesterday, the highest price since April 26. The contract has advanced 3.3 percent this week, gaining for the seventh straight week. That would be the longest winning streak since Nov. 23, 2007.

Soybeans for November delivery gained 1.4 percent to $10.7975 a bushel. Wheat for December delivery advanced 0.7 percent to $6.64 a bushel. The grain has risen 1.4 percent this week, the first weekly gain in three.

To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net

 

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Corn Technicals from Reuters

 

   

SINGAPORE, Oct 7 (Reuters) - CBOT December corn <CZ0> may shoot up to $5.08-¼   per bushel, the wave "b" peak, as a consolidation between $4.87-¼   and $4.96-¼   may have ended.

Corn is characterized with its strong momentum when a trend is established such as a shallow retracement in an uptrend or a moderate rebound in a downtrend. 

A possible inverted head-and-shoulders pattern is developing, with a neckline at $4.96-1/4. A rise above that would lead to bullish target of $5.38. 

A fall from the current level may be limited to $4.80.

   

Corn Technicals from Reuters

SINGAPORE, Oct 6 (Reuters) - The CBOT corn December contract <CZ0> is expected to retrace to $4.80 per bushel, as it has touched a trendline resistance at $4.95.

In addition to the resistance, a possible inverted head-and-shoulders pattern will also be prompt the correction to $4.80. Corn may resume its rally from that level as the drop from the wave"5" peak at $5.28-¾   is classified as a corrective "a-b-c" wave mode.

A rise above $5.00 would extend gains to $5.10.

Corn Technicals from Reuters

SINGAPORE, Oct. 5 (Reuters) - CBOT corn's December contract <CZ0> is expected to rebound more to $4.85, as a pullback towards an ascending trendline that was broken on Sept. 30.

Corn refused to drop more after piercing briefly a strong support at $4.58-¾   - the 61.8 percent Fibonacci retracement level on the rise from $4.15-½   to $5.28-3/4.

The rebound on Monday has signaled a possible end of the fall, in the pattern of an "a-b-c" wave mode, with the wave "c" completing at $4.54-1/2.

Support is at $4.64, a fall below which would indicate a return of the price to $4.54-1/2. 

Corn Technicals from Reuters

SINGAPORE, Oct.1 (Reuters) - CBOT corn's December contract <CZ0> could retrace further to $4.72 per bushel after falling through two ascending trendlines.

The fall below the second trendline indicates strong bearish momentum towards $4.72 - the 50 percent Fibonacci retracement level on the rise from $4.15-½   to $5.28-3/4.

Resistance is at $4.97, a break above which would trigger a rebound towards $5.08.

Corn Trades at More Than $5 a Bushel for First Time Since September 2008

Corn futures climbed above $5 a bushel for the first time in almost two years in Chicago on concern that falling yields in the U.S. and higher demand from importers will erode supplies in the world’s largest exporter.

December-delivery corn advanced as much as 3.2 percent to $5.1175 a bushel on the Chicago Board of Trade, the highest price for the most-active contract since Sept. 30, 2008, and was at $5.09 at 12:25 p.m. Paris time.

“The fundamentals for corn are quite bullish for the moment,” Chung Yang Ker, an analyst at Phillip Futures Pte., said by phone from Singapore today.

Rising demand for U.S. corn exports and lower-than-expected yields may reduce the nation’s stockpiles before next year’s harvest to about 7 percent of domestic demand, the second-lowest ratio on record, according to Rabobank analysts.

That will be smaller than the 15-year low for the stocks- to-use ratio of 9.8 percent forecast by the U.S. Department of Agriculture on Sept. 10.

Corn rose for a seventh session in Chicago, the longest winning streak since June 2008. The December contract is set for a 6.4 percent gain this week.

The USDA may pare its estimates of U.S. yields in the coming months, after a very hot summer, Rabobank analysts Luke Chandler and Doug White wrote in a Sept. 16 report.

The analysts forecast yields at 161 bushels an acre, taking the nation’s crop to 13 billion bushels, down from a record 13.11 billion bushels last season, and the government’s Sept. 10 estimate of 13.16 billion bushels.

‘Major Risk’

“Further erosion of corn-production estimates in the U.S. remains a major risk for the world feed-grain market in 2010- 2011,” the analysts wrote.

December-delivery wheat gained 2.1 percent to $7.34 a bushel in Chicago, paring a weekly loss. Milling wheat for November delivery on NYSE Liffe rose 2.2 percent to 233.75 euros ($306.49) a metric ton in Paris.

The outlook for winter-wheat planting in Russia is one of “doom and gloom” as main growing regions in the Volga and Southern Federal Districts received too little rain to relieve a drought, forecaster Martell Crop Projections said yesterday.

November-delivery soybeans climbed 1.6 percent to $10.525 a bushel, set for a 2 percent advance this week.

To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net.