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Corn market sells off

05/10/2011 @ 9:43am

CHICAGO, Illinois (Agriculture.com)--Despite trading higher most of the session, due to discounted rapid weekly planting progress numbers, the CME Group corn market digested the numbers in the end to close lower Tuesday.

The July corn futures settled 1/4 of a cent lower at $7.07 1/4. The July soybean contract closed 3 cents higher at $13.38. The July wheat futures closed 8 1/4 cents higher at $7.98 3/4. The July soybean meal futures settled $0.10 per short ton lower at $350.30. The July soyoil futures are $0.51 higher at $56.80.

In the outside markets, the NYMEX crude oil is $1.18 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 93 points.

Joe Bedore, FC Stone's CME Group floor manager, says all-session the market the idea that despite a surge in western Corn Belt planting last week, the eastern Corn Belt states remain way behind normal.

"Initially, the markets were led higher by the wheat market. Plus, tomorrow's USDA Reports are expected to show tighter corn stocks. That is making the old-crop contracts pounce on new-crop prices," Bedore says. 

Bedore adds, "This week's USDA Crop Progress numbers are getting discounted. Though the planting progress, at 40% as of Sunday, was further along than expected, the reality is the farmers in Indiana and Ohio are lagging on corn planting."

Corn emergence is the next thing the market will be eyeing. "If Iowa can't record a 35% emergence rate next week, then we'll say that state might have a yield problem," Bedore says. 

Likewise, the soybean market is well supported by slower-than-expected planting progress. "In addition, crude oil has rallied $2.00 off its recent low. That supports the bean market," Bedore says. 

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