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CBOT corn closes lower as wheat surges late

CHICAGO: Corn futures at the Chicago Board of Trade closed higher Wednesday on a late fund-related surge in wheat futures and a firm tone in the soybean pit, traders said.

Corn closed 1/2 to 1-1/4 cents higher, with March up 1-1/4 at $2.22-1/2.

Traders said the fund buying in late trade in wheat generated local short-covering in corn which drove the market to the session's highs near the close.

Corn was pressured at the outset by an opening drop in soybeans and by improved crop prospects in South America and concerns over U.S. exports.

Scattered light showers fell over the past 24 hours in Argentina's corn and soybean areas, Weather Services Corp. said Wednesday. Episodes of scattered showers totalling 1/2 to 1-1/2 inch were expected over the next five days.

The rainfall will provide some relief from persistent dryness, meteorologists said, but it may have come too late to prevent yield losses. Export news overnight was bearish for corn futures.

Earlier Wednesday, the Korea Corn Processing Industry Association passed on tenders to buy 105,000 tonnes of Chinese, Argentine or U.S. corn, citing high prices, traders said.

Technicians see corn confined to a narrow trading range.

"The market needs a close above $2.24-1/2 (March futures) to build a case for the upside," Chicago trading firm RJ O'Brien & Associates said in a report Wednesday. "In the meantime, a trading range of $2.24-2.16 is dominant. Breaking down below $2.16 on a closing basis would argue for a test of the bottom of the previous bull channel at $2.09-1/4."

RJ O'Brien & Associates bought 600 March, E.D. & F. Man International bought 400 May and O'Connor sold 500 March.

Corn futures volume was estimated by the CBOT at 58,000 lots, above the 54,579 lots traded Tuesday.

Corn options volume was estimated at 17,000 lots.-Reuters