The numbers better had turn out bullish.

It is the last full session for investors to place bets on agricultural commodities ahead of Friday's key US Department of Agriculture Wasde crop report.

And they were banking firmly on price-positive numbers.

Among the key market achievements on Thursday were a 3% rise in Chicago soybeans, and a return of corn within an ace of its record high, with the December lot actually setting a new contract top.

In Europe, London wheat for November set a contract high too.

'More bullish pressure'

"Today's thrust of market action is in anticipation of tomorrow's USDA report piling more bullish pressure on the market," traders at a major European commodities house said.

"The question is how much of the impending drop in production the USDA are expected to make is now priced into the market."

For corn yield, they are expecting a figure of 127 bushels per acre, a drop of 19 bushels per acre on last month's estimate, according to market polls.

And the actual results from the field so far are doing little to dispel thoughts of a yield at that level, a 15-year low.

"Early harvest results in the south east are being reported below even some of the most pessimistic estimates," Benson Quinn Commodities said.

Disappointing results

Among recent yield reports from RJ O'Brien are bumper numbers in South Georgia, but poor ones from the heart of the US corn production machine, with even silage from corn on which farmers have given up getting grain from coming in low in Indiana, at around 8 tonnes per acre, less than half normal rates.

One trend RJ O'Brien's Richard Feltes has noted, so far, is for crop forecasts based on kernel counts to prove overestimated.

"Either because of weight, blank plants, or un-pollinated ears the kernel counts seem to be high," compared with results, "so far," he said.

"We'll see if that continues as we get further along, but so far that is the trend."

US Commodities chipped in: "Early silage cuts have been reporting disappointing yields."

Lost acres question

Furthermore, there is a growing lobby too of analysts believing that the percentage of acres making it through to harvest will be cut more drastically in Friday's USDA data than investors are banking on.

"If crop losses are similar to what we had in 1988-89, harvested acres could be some 3.5m lower than the average of current analyst estimates, representing almost 450m bushels of corn production," Paragon Economics and Steiner Consulting said.

That implies a figure of 82.9m acres for harvested corn acres, below even Michael Cordonnier's downbeat 83.0m-acre figure.

Meanwhile, in Europe, expectations keep dropping from Romania, a top-10 corn producer, with FCStone noting that "the outlook for Romanian corn continues to deteriorate, with privates talking of a sub-3 tonnes-per-hectare yield, versus 4.03 tonnes per hectare last year".

Export data

Sure, on the demand side, US corn export sales of 1.1m tonnes, old crop and new, were not as encouraging as they first appeared, given that most of this was down to a preannounced sale to Mexico.

But at least there were not too many cancellations to steal thunder from this deal, with another set of loads shipped to China, 184,000 tonnes, keeping thoughts of Chinese demand alive.

Corn for December, the best-traded contract, stood up 1.4% at $8.28 ¼ a bushel with a little over an hour of trading to go, having set a contract high earlier of $8.29 ¾ a bushel

September corn stood up 1.7% at $8.18 ¼ a bushel, a little below its intraday top of $8.26 a bushel which was 3 cents from setting a fresh record high for a spot contract.

'Significantly wetter'

Soybeans rose more strongly, despite the turn wetter in the weather forecast.

"The main difference in the weather models during the overnight is that the European model has turn significantly wetter in the six-to-10 day outlook," WxRisk.com said.

Paul Georgy at Allendale said: "This moisture should be beneficial to the soybeans that are still alive" – the proportion that are not beyond repair being a big question.

Furthermore, while weekly US export sales were just OK, at 300,400 tonnes, the USDA announced the sale of a further 165,000 tonnes to China through its daily reporting system.

Certainly, shipments booked to China so far this week still look well below the 1m tonnes market rumour has been saying, it is remarkable enough at these high price levels.

Dipped already

And more might be on their way if Chinese authorities see low inflation data out earlier as offering scope to boost monetary policy.

"The declining risk of inflation in China is also supportive soybeans on expectation government will announce stimulus with July inflation rate of 1.8%, down from 2.2% in June," Benson Quinn said.

Furthermore, weekly US soymeal export sales "remain strong above high end of estimates", at more than 210,000 tonnes old crop and new.

Furthermore, the broker was having "a difficult time figuring out how Friday's report could look bearish with soybeans $1.50 a bushel off the highs" already, following a correction from a record top on July 20.

The August lot closed that gap to less than $1 a bushel by soaring 4.0% to $16.94 ½ a bushel, while the better traded November contract added 3.2% to $16.31 ¼ a bushel.

Russia expectations

Chicago wheat couldn't quite match that, but gained 1.6% to $9.13 a bushel for September delivery, helped by continued concerns over the Russian crop.

"Privates still see a potential halt to export flows November onwards and one can expect to see current official estimates discounted by the market," FCStone said.

Furthermore, the grain got support from comments from Commonwealth Bank of Australia and Rabobank over the need for rain for Australian wheat, and expectations of a sharp downgrade in USDA expectations in Friday's report.

'Perfect storm'

In Paris, November wheat closed up 2.2% at E266.00 a tonne, while London's November contract added 2.1% to £196.75 per tonne, having set a contract high of £197.05 per tonne earlier.

A weekly report on the, delayed, UK harvest from Adas reported "highly variable" yields so far, and further cautions over disease pressure following persistent and heavy rains.

"There have been further reports of fusarium leaf blotch from all regions," the consultancy said, adding that "overall, mycotoxin risk remains moderate to high".

At the HGCA crop bureau, Jack Watts said that "pre-harvest uncertainty toward both wheat yields and quality has, in 2012, been at its highest in living memory for some.

He added that "the delay to harvest combined with limited old-crop stocks has been close to a perfect storm, taking UK prices to import parity".

Cane harvest acceleration

In Brazil, where a period of damaging and heavy rains has ended, mills in the key Centre South region responded by processing 46.27m tonnes of cane in the second half of July, up 9.7% on the first half total and up 10.8% year on year, according to industry group Unica.

The increase reflected an increase in cane yields of 13.8% top 78.5 tonnes per hectare, putting a potential upgrade on the card to Unica estimates.

"If this trend of increasing productivity is maintained in the coming months, it is likely that the amount of cane available for crushing this season is above the estimated 509m tonnes in April," Antonio de Padua Rodrigues, the Unica interim president, said.

But levels of sugar in cane remained below year-ago levels, limiting the damage from the data on raw sugar futures, which ended down 0.8% at 20.80 cents a pound in New York.