The investor cheer after China stuck by its 7.5% growth forecast for 2013 certainly helped equities.

Wall Street's Dow Jones Industrial Average share index grabbed headlines among investors by looking set for a record high close, beating the 14,164 hit in October 2007.

(The index stood at 14,253 in closing deals.)

This is the same Dow Jones Industrial Average which fell to 6,547 in March 2009, at the depths of the world economic crisis.

'If ever there was a bearish move…'

As for commodities, well they managed to contain their excitement, despite the importance of China for raw materials demand, with the CRB commodities index adding all of 0.3%.

But even if most major commodities managed some gains, one signally did not – arabica coffee, which tumbled 3.8% to 141.15 cents a pound in New York for May delivery.

And this after a firm start to the week, and amid fresh focus on the roya fungus, the cause of coffee rust, terrorising Central American plantations.

Early on, "everyone was looking at the New York market thinking it probably has another 4-5 cents on the upside after we broke the 144 cents a pound resistance area yesterday, mainly off the back of the coffee rust problems in Central America," Sucden Financial related.

"However, if ever there was a bearish move, it was today," the broker said, blaming the negative close on "liquidation of the recent speculative longs".

Brazil factor

It is "looking like sub-140 cents a pound is well on the cards", Sucden added.

Nor did Commerzbank strike too bullish a note in saying that while prices had risen some 6% in the last two weeks (ahead of today) largely on the back of roya fears, "all this news should not allow us to forget that Brazil is set to achieve a coffee harvest that is expected to be record-high for a low-yield year.

"This is also likely to continue to weigh on prices in the medium-term."

Nor could London robusta coffee beans thrive in this environment, shedding 1.5% to $2,090 a tonne, despite concerns about the impact of dry weather on output in Vietnam, the top producer of the variety.

"Reports from Vietnam point to a poor harvest in 2013-14 on the back of prolonged drought," Commerzbank said.

"That said, it remains to be seen whether the 20-25% collapse in the harvest feared by growers will actually materialise."

'Cash market is very tight'

Compared with that performance, other agricultural commodities had a bumper day, especially Chicago corn, soaring 1.4% to $7.33 a bushel for March delivery, and 0.8% to $7.09 a bushel for the better-traded May contract.

In fact, Glencore chief executive Ivan Glasenburg did remind of the link between corn and Chinese imports, saying that if Chinese consumers ate as much pork as their Hong Kong compatriots, the country would need "an additional 160m tonnes" of the grain a year.

But the main reason for bullish cheer seemed to be the continued dearth of supplies for short-term delivery in the US, forcing investors with short positions on the expiring March lot into an uncomfortable position.

"There is still a short squeeze in the March corn contract as the longs seem very willing to take delivery and are simply waiting for the shorts to deliver," Darrell Holaday at Country Futures said.

"The problem is the cash market is very tight and the shorts are not able to find the product to deliver and are opting to lift their short position."

Wheat cheaper than corn

But, yet again, fellow grain wheat lagged, extending its discounts to corn in March and May contracts.

Chicago wheat for March gained all of 0.25 cents to $6.96 ¼ a bushel, with the May lot adding 0.5% to $7.06 a bushel.

And this despite some ideas of improving domestic demand.

"The price of wheat is giving feedlots and end-users a reason to think about replacing corn with wheat," Paul Georgy at Allendale said.

And as for exports it appears that US wheat did feature in the weekend's 575,000-tonne order by Saudi Arabia, along with Australian and European Union supplies, although officials declined to gove origin volume details.

US Commodities said: "Saudi Arabia purchased wheat mostly from Australia. It was surprising since Saudi Arabia's wheat was $27 a tonne higher than US wheat," with US spring wheat, usually a premium option, "trading below US corn" at Gulf of Mexico ports.

'More consistent with the rain'

However, stacked against wheat was the improving optimism over the condition of US winter wheat seedlings following recent rains, ideas which were given some traction by improved crop condition.

Kansas wheat was seen 24% "good" or "excellent" as of Sunday, with Oklahoma's crop improving to 24% good or excellent from 9% the week before.

And, looking ahead, "the weekend models are becoming more consistent with the rain" in the forecast, stretching at least into northern Kansas, as well as eastern Nebraska, Country Futures' Darrell Holaday said.

"The southern areas of Kansas and into Oklahoma should see rainfall, but the amounts will be much smaller according to the most recent GFS model run."

Furthermore, Australia's Abares forecast some recovery in world wheat production in 2013-14, including a 13% recovery in domestic output, while UkrAgroConsult lifted its forecast for the crop in Ukraine, a key wheat export competitor, (albeit an upgrade thanks mainly to better hopes for corn).

Yet more export demand

The question for investors in Chicago soybeans, meanwhile, was whether the oilseed could at last close back above $15.00 a bushel, for March delivery.

That outcome looked likely after the US Department of Agriculture announced the sale of 775,000 tonnes of US soybeans through its daily reporting system, following rumours of Chinese buyers on the prowl.

Half were for 2012-13 delivery, of which supplies are already thin, with the US having exported 1.15m bushels of soybeans – 85% of the USDA forecast for the whole season – yet at only the half-way point.

Indeed, the orders cemented the idea that Brazilian logistical hiccups are driving trade to the US – which may itself be forced into imports before the 2013 harvest comes onstream.

Ceiling holds

"Soybean crush margins throughout the world are very positive and crushers do not want to miss out on any of these positive margins," Mr Holaday said.

"Therefore, Chinese crushers do not want to hear about shipping delays out of Brazil. That is why they are pushing to buy US soybeans."

US Commodities added: "Soybeans continue to be supported by the continued shift to soybean purchases from Brazil to the US. The loading delays in Brazil remain an issue."

But while Chicago's March soybean lot could clamber over $15.00 a bushel intraday, for the third time in four months, it could not put in its first close above that mark since November.

The contract closed at $14.96 ½ a bushel, up 0.4%, but well below the day high of $15.11 a bushel, with May soybeans ending up 0.3% at $14.66 ½ a bushel.