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Corn prices chop around

01/11/2012 @ 9:37am

DES MOINES, Iowa (Agriculture.com)--Aside from positioning ahead of tomorrow's USDA Reports, the market experienced soybean selling and light corn buying Wednesday.

After trading mixed, the March corn futures closed 1/2 of a cent lower at $6.51 1/2. The March soybean contract settled 29 cents lower at $12.03. The March wheat futures finished 1 1/4 cents higher at $6.41. The March soymeal futures closed $9.70 per short ton lower at $312.80. The March soyoil futures closed $0.61 lower at $51.89. 

In the outside markets, the NYMEX crude oil is $1.31 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 28 points.

Tim Hannagan, PFGBest.com senior grain analyst, says the sharp weather rally from Monday gave way to some pre-report profit taking ahead of Thursday's USDA Crop Report. 

"Longs are taking some profits out as to report day uncertainty. Corn turned up on the day at midsession, as bulls bought the opening low as perception leans to a bullish corn report," Hannagan says.

There is a lot of positioning and squaring up today with some spreading to cut risk, he says. 

"But Friday looks for traders to turn back to weather in South America which looks warm and dry again," Hannagan says. 

Joe Bedore, FC Stone's CME Group floor manager, says corn is supported by the market discounting Argentine rain relief.

"The market isn't believing the rains are helping the Argentine corn crop. The damage has been done. "So, people are buying corn, selling soybeans. Plus, the trader thinks some people are believing the "wild" estimate this week by a trader that said the USDA is off 300 million bushels on its U.S. 2011 corn production number," Bedore says.

If the government confirms this "crazy" estimate, the way we go up. 

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