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Grain prices close higher

Updated: 04/11/2011 @ 2:17pm

CHICAGO, Illinois (Agriculture.com)--After rainy forecasts lead many to believe corn planting will be delayed this week, the CME Group corn market closed higher Monday.

The May corn futures settled 8 cents higher at $7.76. The May soybean contract closed 23 3/4 cents lower at $13.68 1/2. The May wheat futures ended 3/4 of a cent higher at $7.98 1/4. The May soybean meal futures finished $7.50 per short ton lower at $349.70. The July soyoil futures closed $0.86 lower at $58.91.

In the outside markets, the NYMEX crude oil is $3.25 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 20 points.

Tim Hannagan, PFGBest.com senior grain analyst, says weather is supporting corn and wheat. "When traders come in on Monday the first thing they do is look at the weather and its impact on early field work and planting and price it in. The current forecast suggest heavy rains in the Midwest, delaying early field work. The same conditions, in the Delta all week, delaying early planting. With historically low ending stocks of corn," Hannagan says.
The market will be unusually sensitive to late corn planting, as it suggests lower yield, he says. 

Meanwhile, soybeans are trading a negative mindset. "If the month of April stays wet then there's a risk of planting more beans, it's all funds thinking the worst."

Dustin Johnson, E-Hedger commodity broker, says China's talk of canceling cargoes is pressuring the soybeans. "This means the U .S. carryout could go up. Plus, COFCO, China's grain division, lowered their 2011 soybean imports by 1.0 million metric tons," Johnson says.

For corn, the weather is bullish, Johnson says. "Plus, the latest CFTC report shows the funds extended their net long position last week by 30,000 contracts. The fact that the funds are getting 'heavy' again on corn is bullish," he says.

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