COMMODITIES : Corn Soars Despite Early Profit Taking

Corn futures advanced strongly and soybeans finished slightly higher despite some earlier profit taking Tuesday on the Chicago Board of Trade.

Wheat futures, on the other hand, fell by a nickel or more per bushel.

On other markets, livestock and meat futures were mixed, energy was higher and precious metals declined.

On Monday, prices on all six agricultural commodities had soared the daily permissible limit at the opening at the Board of Trade and stayed there as hot, dry weather in the Midwest showed no signs of letting up.

By contrast, commodities futures prices were very volatile Tuesday, particularly in soybeans.

“Nonetheless, the performance was impressive,” said Rich Feltes, commodity research director in Chicago for Refco Inc.

Soybeans had increased more than $1 a bushel in the last week and had two consecutive sessions of 30-cent-limit gains going into Tuesday’s session.

Prices opened sharply higher again, sold off almost immediately, staged a comeback and then faded near the close.

“The market was up so sharply, it was due to pull back,” said Walter Spilka, an analyst in New York with Smith Barney, Harris Upham & Co.

Wide Price Swings

“Traders have made enough money and were willing to sell, and selling tends to touch off further selling,” he said.

By day’s end, the July soybean contract had traveled between a high of $9.09 a bushel to a low of $8.66 and closed with a 3-cent gain over Monday at $8.82.

Wheat futures prices fell, however. Weekly crop reports released late Monday showed the deterioration in the winter wheat crop, which is about to be harvested, was not as severe as had been expected, said Jerry Gidel, an analyst in Chicago with G. H. Miller & Co.

Wheat settled 4.75 cents to 14 cents lower, with the contract for delivery in July at $3.78 a bushel; corn was 9 cents to 12.75 cents higher, with July at $2.58 a bushel; oats were 6 cents to the limit 15 cents higher, with July at $2.22 a bushel, and soybeans were 10.50 cents lower to 3 cents higher, with July at $8.82 a bushel.

With a relatively subdued performance in grains, some upward price pressure was taken off livestock futures at the Chicago Mercantile Exchange.

During the past few sessions, the distant delivery months of pork and cattle have been pushed higher by the cost of grain, said Charlie Richardson, an analyst in Denver with Lind-Waldock & Co. He said traders felt higher feed costs would reduce production of broilers and competition for red meat.

Hog producers also were expected to slow expansion.

“So, with the grain market not nearly as wild as it was the last two sessions, we had some pressure relieved” on livestock prices, Richardson said.

Energy Futures Rise

Live cattle settled 0.50 cent lower to 0.85 cent higher, with the June contract at 73.10 cents a pound; feeder cattle were 0.75 cent to 1 cent higher, with August at 75.92 cents a pound; live hogs were 0.77 cent lower to 0.50 cent higher, with June at 52.92 cents a pound, and frozen pork bellies were 1.25 cents lower to 1.35 cents higher, with July at 54.87 cents a pound.

Energy futures moved slightly higher on the New York Mercantile Exchange.

Prices were merely rebounding from sizable technical losses the day before, said Nauman Barakat, an analyst in New York with Shearson Lehman Hutton Inc.

“In addition,” he said, “there are some rumors that OPEC is going to work out some compromises.” Ministers of the Organization of Petroleum Exporting Countries meet in Vienna beginning Saturday.

“There’s been some talk they’ll attempt to get Iraq back as an active member of the cartel,” he said. “And also rumors that they’re ready to restart a dialogue with non-OPEC nations.”

West Texas Intermediate crude oil settled 3 cents to 11 cents higher, with the July contract at $17.37 a barrel; heating oil was 0.25 cent to 0.46 cent higher, with July at 46.23 cents a gallon, and unleaded gasoline was 0.10 cent to 0.47 cent higher, with July at 50.20 cents a gallon.

Precious metals futures were lower on the Commodity Exchange in New York.

Gold settled $2.90 to $3.40 lower, with the June contract at $460 an ounce; silver was 3.5 cents to 3.8 cents lower, with July at $7.28 an ounce.

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