Grain prices could not match coffee for upward movement.
for July soared 7.1% to 213.40 cents a pound in New York, earlier hitting
215.70 cents a pound, a two-year high for a nearest-but-one contract, after
Volcafe cut its forecast for the Brazilian harvest this year, while raising its
estimate for the world production deficit in 2014-15.
In fact, not even robusta
coffee came anywhere near matching that, ending up 0.9% at $2,156 a tonne
Volcafe's overall Brazil production downgrade included a
1.0m-bag upgrade to the estimate for the country's, smaller, robusta harvest.
Still, back among grains, corn and wheat managed healthy
gains nonetheless, staging a Turnaround Tuesday in Chicago of some note in the
That was especially true of corn, which gained 1.7% to $5.02
a bushel for July, in gains attributed to the US Department of Agriculture data
overnight showing US seedings only 6% complete as of Sunday, above the 4% of a
year before, a particularly poor sowing period, but well below the average of
In fact, brokers queued up to ease concerns over the slow
Allendale, for instance, said that its research "suggests we
should not be worried about late planting.
"In the past six late panting years, yields exceeded trend
yield projections five times."
At Country Futures, Darrell Holaday doubted the accuracy of
the 6% figure.
"We put little credibility in that number as we feel there
was more progress," he said, adding that a "large part" of the Corn Belt was
set for a strong sowings pace later this week.
Indeed, Iowa-based broker US Commodities said that "Midwest
weather forecasts suggest fair planting weather for the next few days".
And CHS Hedging said that rains on Monday "moved east
without causing too much concern for further field work delays."
In fact, the precipitation "will benefit newly planted seeds".
Meanwhile, the "latest extended forecast shows windows for planting
headway in the 1-5 day" period.
Still, not all meteorologists are quite so upbeat about the
weather outlook, with Gail Martell at Martell Crop Projections warning that "the
weather pattern is suddenly wet.
"Widespread soaking rains are coming to the Midwest and
Northern Plains where recurring showers are predicted in the upcoming
"The result will be severe planting delays."
Meanwhile, for next week, MDA, noted that the forecast had
turned "cooler" in the six-to-10 day forecast for the south eastern Midwest
And the sowings window will not last for ever, with many seeing
the ideal planting period as ending in the first half of May, depending on the
No improvement in
Wheat for July
lagged in closing up 0.6% at $6.79 ½ a bushel for July delivery.
Still, that was a far better performance than in the last
session, when the contract shed 3%, and was attributed to some disappointment
at the lack of improvement in the condition of US winter wheat, as revealed in
overnight USDA data.
That placed the dryness-hit crop at just 34% "good" or "excellent",
the same as the week before, with some deterioration in Kansas, the biggest
producing state, as frost offset a fillip from some rainfall.
And forecasts are not too positive for producers either.
"Warm, windy, and dry weather should help support winter
wheat in continuing the moisture problems," US Commodities said.
Gail Martell put it that "rainfall is coming to the Great
Plains, but showers are expected to miss the dry western one-third of the wheat
"Drought continues to be main worry in the seven top
bread-wheat states," she said, adding that "this is an historic drought".
Still, not all the weather news was so positive for prices,
with Europe's dry areas faring better in terms of rain relief.
"Some rains have reached dry areas of Central and Northern Europe, with
more forecast," Jaime Nolan Miralles at broker INTL FCStone's Dublin office
"Although not in huge abundance, they go some way to alleviating concerns
for winter wheat in these areas."
MDA said that rains had provided some relief for dry areas
of the former Soviet Union, with more rainfall in the forecast.
Indeed, it was notable that Paris wheat far underperformed
its US peers, falling 1.3% to E214.75 a tonne for May delivery, with the better-traded
November contract shedding 1.7% to E203.25 a tonne.
That appears a sign that investors were willing to ignore
the latest rumpus in Ukraine - where the killing of a politician, apparently by
separatist activists, has revived tensions between Kiev and Moscow – the differing
performance of US wheat contracts was another.
Certainly, Chicago wheat, the speculators' favourite, didn't
fare too much better than Kansas City hard red winter wheat – at the heart of
the drought concerns - which gained 0.4% to $7.45 ¼ a bushel.
Minneapolis spring wheat added 0.5% to $7.23 ¼ a bushel,
with the USDA crop progress data showing spring seedings at 10% complete, well
below the average of 19%.
In fact, it was soybeans
which underperformed, continuing to be undermined by talk of Chinese defaults
on import orders, albeit from South America, which will nonetheless impact the
"The soybean market is hearing continued talk of China
working to shift soymeal and soybean
cargoes purchases from Argentina and Brazil into the US," Benson Quinn Commodities
Chinese soybean processors "are losing the equivalent of
$100 a tonne on product handled", CHS Hedging noted.
In fact, there was more talk of Argentine soymeal being sold
into the US, with a cargo said to be arriving on May 1, along with continued
rumours of 2-3 Brazilian cargos of soybeans on the way.
Strong EU imports
In fact, not all the news was so bearish.
China's Ministry of Commerce is estimating China's soybean
imports in April at 6.9m tonnes, which would be a record high, and above the
previous forecast of 5.11m tonnes.
And Oil World underlined the strength of European Union
demand, pegging the bloc's imports in 2013-14 at 13.9m tonnes, well above the
12.3m tonnes at which the USDA has the figure.
EU crush margins had been "very attractive" earlier in 2014,
boosted by lower-than-expected soymeal imports from South America.
Still, Abiove, the Brazilian oilseeds group, underlined the
case for bears by cutting its forecast for the country's exports this season by
1.0m tonnes, citing weaker hopes for China.
And technical factors turned in bears favour too.
"The move down pushed the May and July contracts below
yesterday's lows" where there were "stops hit", Country Futures' Darrell Holaday
"The key technical support for July soybeans is the uptrend
line that extends back to late January," is currently at $14.58 a bushel," he
"The move today is generally an indication that the uptrend
support line will be tested sometime this week."
Soybeans for July actually closed down 1.1% at $14.70 ¾ a
bushel, with July soymeal ending down 1.2% at $470.30 a short ton.
Slow cotton plantings
Back in New York, cotton
for July added 1.1% to 93.25 cents a pound, also feeling support from the USDA
crop progress data, with US sowings of the fibre lagging.
Farmers sowed only 1% of their crop last week, taking the
total to 9%, behind the average of 12% by now.
And raw sugar for
May added 0.9% to 16.99 cent a pound, while the July contract added 0.5% to
17.62 cents a pound.
At Price Futures, Jack Scoville highlighted
bigger-than-expected Chinese imports last month, of 411,132 tonnes, "about
double the pace of the previous year", as revealed in data on Monday,.
"Calendar year to date imports are now 863,563 tons, up
63.3% from last year."
'Vulnerable to heavier
Still, at Sucden Financial, Nick Penney cautioned about a cut
in the speculative net long position in New York raw sugar futures in the latest
week potentially setting a trend.
"Without further momentum on the upside we would expect the
market to be vulnerable to further and heavier liquidation," he said.
"Weather, and El Nino, risk is still present so this may
explain the slowness in the reduction in speculative net longs," and indeed
were highlighted in US expectations for lower Thai production in 2014-15.
"But we feel that values need to move further down to
attract end destination demand."