Grains and oilseeds started ahead on Thursday, but without
too much conviction.
And, given the experience of the last couple of sessions, it
is easy to understand why.
On Monday, Chicago crops opened weak, but closed in positive
territory, at least keeping in with a history of gains on both the days before
and after Christmas.
On Wednesday, when trading reopened after the holiday, a
firm start gave way to a dismal finish, showing no deference at all to the
so-called "Santa seasonal" trend.
So which way for investors to head this time?
Many news on the fundamental front has actually been
positive, with, for instance, the US Department of Agriculture on Wednesday
revealing the sale of 115,000 tonnes of soybeans
to China, and a further 108,000 tonnes to "unknown".
Mike Mawdsley at broker Market 1 said: "This was just the
news we need to hear after the recent cancellations from China the past couple
weeks," totalling nearly 1.0m tonnes (if some by "unknown" are included).
Furthermore weekly data on exports, as measured by cargo
inspections, were solid too, at 13.5m bushels for corn, at the top end of market expectations, and 15.1m bushels for wheat, mid-range.
For soybeans, inspections reached 44.5m bushels, above
Then, supportive for wheat, are concerns over Russian winter
grains crops, which have braved a cold temperatures with a somewhat threadbare
snow blanket in many areas.
"Temperature remains very cold in Russia," consultancy Agritel
Snow cover is generally "heterogeneous" and "still
insufficient" in the South, where the chill "worries farmers".
However, such fears are being countered by improved thoughts
on the drought-hit US crop, after moisture in parts of the Plains that needed
"The area that received the most moisture was in southern Oklahoma
and northern Texas," Darrell Holaday at Country Futures said.
Meanwhile, ideas on South American weather, increasingly taking
the spotlight, remain, generally, favourable.
"There are no weather
issues in South America and that has kept a lot of speculative interest on the
sidelines," Mr Holaday said.
But US Commodities flagged some weak points, saying that "dry
spots in far northern Brazil continue, affecting about 20% of the corn/soybean
Flooding is still a problem in parts of Argentina too.
Meanwhile, although external markets remain somewhat clouded
by the impasse on US budget negotiations, at least the dollar is weaker, down 0.2%, so making dollar-denominated assets
including many commodities more affordable as exports.
But with volumes still low, threatening the potential for
severe movement, as in the last session, investors were cautious about pushing
crops too far higher.
rebounded, but only by a small distance compared with its 2%+ losses of the
last session which took it to a fresh five-month low.
The March contract gained 0.3% to $7.77 a bushel as of 09:30
UK time (03:30 Chicago time).
Corn for March, which
set a five-month closing low in the last session, recovered 0.3% to $6.95 ¼ a
bushel, while March soybeans gained
0.6% to $14.27 ¼ a bushel.
Among soft commodities, New York raw sugar for March inched 0.4% higher to 19.12 cents a pound, given
some support by the afore-mentioned dry weather in north eastern Brazil, the
country's other sugar-growing region, apart from the main Centre South
But cotton for
March eased 0.3% to 76.85 cents a pound, falling back on profit-taking after
hitting a three-month high in the last session.
Cotton prices have been buoyed by firm US export sales,
including to China, where huge stocks had appeared a bar to purchases.
Back among oilseeds, in Kuala Lumpur, palm oil extended its recovery on hopes for Malaysian exports next month,
when export duties are being cut to zero.
March palm oil gained 1.2% to 2,459 ringgit a tonne, putting
some distance between itself and the three-year low of 2,217 ringgit a tonne
set two weeks ago.