Markets Awaken After USDA Reports

CHICAGO - Apr 2/07 - SNS -- International agriculture commodity markets were relatively busy over the weekend, with a good quantity of U.S. corn trading to South Korea in private deals as buyers took advantage of market weakness stemming from Friday's USDA seeding intentions estimates.

Friday's Commitment of Traders report with options shows the corn market in a positive setup, say analysts with the Chicago Board of Trade (CBOT), but the selling trend of the speculator (long liquidation) is a short term negative force.

Speculators reduced their net long position by nearly 22,000 contracts for the week ending March 27th. The new supplemental report showed trend following funds net long 228,211 contracts.

The Commitment of Traders report shows soybean markets "in a classic bullish setup with non-commercial traders net long and non-reportable traders net short nearly 18,000 contracts," say CBOT analysts.

The new supplemental report showed trend-following funds net long 70,163 contracts, not the net long of 83,146 contracts posted in the traditional report. Oil and meal look somewhat overbought with speculators net long 93,590 contracts and 50,690 contracts respectively.

For wheat, the Commitment of Traders report shows the market is oversold with speculators net short 29,508 contracts. The new supplemental report showed trend-following funds net short 26,143 contracts, not the net short of 2,237 contracts posted in the traditional report. Non-reportable traders in the traditional report were net short over 27,000 contracts. This leaves the market vulnerable to short covering if resistance is violated, CBOT analysts argue.

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