Financial markets opened on better form on Tuesday, as the concerns over Cyprus's tax on bank deposits eased a touch.

Barclays, for instance, while acknowledging the risk of some knock-on effects in other countries said that it saw "read-across to other banking systems, and expect contagion to be limited in scale.

"The amounts involved are small in the macro context."

Shares on many Asian markets recovered ground, with Tokyo's Nikkei index closing up 2.0%, and Shanghai stocks adding 0.8%, while Seoul's Kospi gained 0.5%.

'Large global excess'

That helped agricultural commodities stage something of a Turnaround Tuesday – the idea among Chicago traders that a strong trend seen in the first day of the week reverses in the second.

But it was hardly an extreme version, handing back to soybeans only a small proportion of Monday's losses.

Indeed, in New York, cotton lost early headway to stand 0.2% lower at 90.65 cents a pound for May delivery as of 09:30 UK time (4:30 Chicago time, 05:30 New York time).

However, raw sugar, gained 0.3% to 18.35 cents a pound for May, if still well down for the week so far, after its biggest loss in five months in the last session.

"Although sugar prices have been supported by Brazilian ethanol policy changes set to increase demand for ethanol and draw down sugar stocks, and port delays that are slowing Brazilian sugar exports, sugar prices remain extremely susceptible to global market forces due to the backdrop of its large global excess," Joyce Liu at Phillip Futures said.

"We hold on to our view that sugar prices may break out on the bullish side, but we now expect it to come later in April."

'Shifting demand'

In Chicago, soybeans for May gained all of 0.1% to $14.11 ½ a bushel, but a potentially significant 0.1% nonetheless, in that, if held, it would give the contract its first positive close in six sessions.

 The oilseed is being pressed by fears that a long-awaited slump in US soybean exports may have arrived, as supplies from the Brazilian harvest reach buyers, even after hefty delays, and with a worrying silence in terms of fresh Chinese orders from America, of 2012 crop at least.

"Large South American production and shifting demand remain headline features, with no confirmation coming over the past week of any fresh demand from China for US soybeans," Kim Rugel at Benson Quinn Commodities said.

"With talk of Brazilian cancellations that were also rumours China may have shifted some cargoes to Argentina to push back shipment dates, while some were saying China was able to cancel due to non-performance contract specifications."

Whatever, the weakened basis at US ports "says China is not looking north for replacement".

Carcass count

And there is concern over China's demand for feed overall, if worst case fears over a large dump of pigs into the Huangpu river, which runs through Shanghai, are realised.

The carcass count is now approaching 15,000 animals, according to local reports.

While only a fraction of the country's total herd, if the animals are being dumped because of disease – which is only speculation – that could have an impact on feed demand, if it were to reach the levels of previous epidemics.

Frost damage?

However, these fears took a back seat when soybeans managed a small rise on China's Dalian exchange, adding 0.2% to 4,735 yuan a tonne, with soymeal up 0.2% at 3,210 yuan a tonne and soyoil rising 0.8% to 8,108 yuan a tonne.

(Rival vegetable oil palm oil rebounded in Kuala Lumpur too, adding 1.4% to 2,419 ringgit a tonne.)

Meanwhile, there has been some fuss over freezing temperatures which hit Argentina at the weekend, potentially damaging soybean crops.

That said, weather service MDA said that "any freeze damage in south eastern Buenos Aires was very limited".

Crop condition

Among the grains, wheat rebounded a little too, adding 0.3% to $7.15 a bushel.

The news from US state crop inspection reports was not all good for farmers, despite recent rains bringing much-needed soil moisture.

While the Kansas and Oklahoma briefings showed further improvements in crop condition, winter wheat seedlings in Texas went back into reverse, and Colorado came in with a weak reading, of 12% in good or excellent health, too.

Spree of tenders

And there are signs of end-user buying, with tenders from Algeria, Jordan and Tunisia unveiled on Monday, if at a time when cash-strapped Egypt, the top importer, looks to be doing its best to keep out of the market, a desire helped by estimates of a strong 9.5m-tonne domestic harvest this year.

Last year's was some 8.5m tonnes.

Ukraine has done its bit to underpin hopes for US exports by revealing plans for an extension into 2013-14 of an informal cap on wheat exports, agreed with merchants, which the farm ministry says has allowed more control over domestic prices.

Meanwhile, technical factors have helped too, after Chicago's May contract successfully bounced off its 10-day moving average in the last session, and closed back up at its 20-day line.

Spread trade

Wheat was also given a hand by fellow grain corn, which defied Monday's sell-off, and continued to make ground on Tuesday, gaining 0.4% to $7.22 ½ a bushel for May, so maintaining a small premium over wheat.

Indeed, Phillip Futures' Ms Liu said that the "trading of the wheat-corn spread may be a profitable strategy now", saying wheat prices have historically seen an "immediate rebound" versus corn after falling to a discount.

"With wheat prices now trading at a slight discount to corn, we foresee the spread to gravitate towards zero despite the tighter fundamentals of corn," she said.

'Ready to add risk premium'

That said, corn's tighter fundamentals are counting, especially in the run-up to a key US stocks report at the end of the month which has a history of coming in below analyst estimates (in four out of the last five years).

"Corn appears ready to add risk premium in the ramp up to the March 28 report," Richard Feltes at broker RJ O'Brien said.

Technically, corn is looking better too, with the May lot finding a floor at its 50-day moving average in the last few sessions, and rising clear of its 100-day moving average on Tuesday for the first time in seven weeks.

Bulls are not, though, having it all their own way, with hopes rising for Brazil's corn crop.

Respected crop scout Michael Cordonnier, at Soybean and Corn Advisor, lifted his estimate for the harvest by 2m tonnes to 74m tonnes, while Safras pegged the crop at 77.3m tonnes – including a record 40.0m tonnes for the second crop, or safrinha, harvest.