FX.co ★ Corn review for June 23, 2011

Futures on corn mixed on Thursday having earlier hit 6-week highs amid growing US dollar and falling oil prices
Futures on corn mixed on Thursday having earlier hit 6-week highs amid growing US dollar and falling oil prices.
By the end of CBOT trades corn futures increased by 3 cent to constitute USD 6.8 ½ per bushel, whole December contract fall by 4 ½ cent to equal USD 6.68 per bushel. Concerns over strengthening American currency will cause lower demand for goods including grain put pressure upon the market on Thursday. The growth of the US dollar makes futures expensive for holders of other currencies.
On June 23, the US Agriculture Department informed that export demand for corn dropped by 41% and equaled 531 000 tons as compared to the last week.
Declining quotations of oil futures also led to bearish sentiment as ethanol is made from corn.
Sales restored on Thursday after earlier on Wednesday futures on corn dropped by 30 cent which is a day limit set by the burse amid voluminous sales by market participants. Further liquidating long positions can bring about even lower prices. At present futures decreased by 17% from all-time high of USD 8 per bushel hit earlier this month. On Thursday the day limit for corn futures was boosted to 45 cent per bushel.
Closing long positions by large funds shadowed fundamental factors possible to support the market later. In the USA grains have been remaining at the levels of their 15-year lows while global demand for corn is rather strong.
On the other hand, meteorological agencies forecast dry and warm weather next week which can have positive effects for harvests.