out in what was a broadly weak day for commodity markets as housing data from
the US unexpectedly weakened.
The NAHB Housing Market Index reading for February weakened
to 46 from 47 in January, the index had been expected to show a moderate
down 0.8% on the LME, while gold declined 0.6%.
That said equities enjoyed a positive day, bolstered by
merger rumours and steady sentiment as US markets returned following yesterday's
holiday while Asian markets got back to speed following last week's lunar new year
On share markets,
the Dow Jones Industrial Average finished up around 0.4%; in Europe the FTSE
100 posted a 1% gain and the German DAX 1.6 %
The dollar closed
relatively weak, down 0.3% against the euro and 0.6% versus the Japanese yen.
The continued gains in soybeans today relate to ongoing
issues with Argentina as limited rainfall over the weekend did little to reduce
drought-related crop shortages from the world's third-largest soybean exporter.
The most active soybean contract in Chicago, for May
delivery, finished Tuesday with a strong 3.0%, settling at $14.57 ¼ a bushel.
"Though recent rains were highly beneficial, much
moisture is needed to significantly improve corn and soybean conditions,"
indicated Gail Martell, Meteorologist with the Martell Crop
While reports suggest the growers benefited from "heavy
rainfall over most of the grain belt last week," Martell cautioned that
drought has continued to "stress" crops in the western Buenos Aires
area, a key corn and soybean area, after they, "missed out on heavy
rainfall last week.
US soybean futures have also been bolstered by media reports
that Argentinean producers are withholding supplies amid speculation of further
depreciation in the Argentine peso, which would result in higher revenues for
The latest release from the Argentine ministry of
agriculture reflects the reluctance amongst exporters, reporting some sale
under the current harvest are down 35% on the same time last year.
Soymeal has also
seen a positive day, rising on the coat-tails of soybeans and comments from a
feedmill association in Indonesia, suggesting imports by the country would grow
by 5% per year for the next five years on the back of rapid expansion of the
countries aquaculture industry.
Soymeal for March delivery closed with a solid 3.9% gain, to
$425.30 a short ton.
Corn, wheat slips as
wet weather returns
In contrast to the drought related gains in the soy complex,
corn and wheat prices traded lower amid reports wet weather across the
"A mixture of rain, sleet and snow is expected in
Kansas and Oklahoma," reported the Martell Crop
Between 0.5-1 inch of rain is expected to fall over most of
the hard red winter wheat region late this week with a similar system bringing
further rain and snow next week, according to reports.
At present reports suggest the three major wheat states are
currently reporting near-normal winter moisture. However, the Martell
group cautioned that drought concerns are not-over, warning that subsoil
moisture levels remain very low following the drought conditions witness across
last summer and autumn.
"Going back to mid-July, however, the Oklahoma wheat
moisture deficit is 5 inches."
May corn futures were down 0.7% by the close at $6.92 a
Wheat futures for the same delivery month were down 1.3% in
Chicago, at $7.38 ¾ a bushel.
Cocoa falls as short
The weaker tone across much of the commodity complex did
little to help the price of soft's as cocoa
futures slipped to an eight-month low of $2,117 a tonne in New York. Similar
weakness was witness in London futures, which also touched a multi-month low.
The weakness was in part attributed to Fridays Commitment of
Traders report, "showing the increase in the speculative short position to
over 90,000 lots as of last Tuesday," indicated Nick Penney, analyst at
Additional pressure came as Cameroon, the world's
fifth-largest cocoa grower, reported a 14.9% year-on-year increase in shipments
in the five months ending January, according to the National Coffee and Cocoa
Cocoa exports totalling 172,135 tonnes compared with 149,793
tonnes in the same five month period ending January 2012.
Cocoa futures for May delivery closed at $2,119 tonne in
New York, down 1.2% on the day.
lower in line with the general soft tone, although trade was largely focused on
positioning ahead of tomorrow's notice period.
As a result plenty of activity seen in the March/May spread,
which weakened initially before turning higher and trading "all the way
back in to the 190 discount area" noted analysts at Sucden, as fund and
trade short positions were rolled forward.
New York arabica
coffee futures for March settled at 136.50, the May contract finished at
138.40 cents per pound.
ICE raw sugar futures for May shrugged off the
mixed moves in rest of the complex to finish up 0.9% at 17.96 cents.