PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 09:35 GMT, Monday, 17th Feb 2014, by Agrimoney.com
Morning markets: palm, rubber extend rebounds. Sorghum eases

Monday being a US holiday, and closed Chicago and New York markets, is likely to mean somewhat slower trading among what agricultural commodity contracts that are open for dealing.

Still, that did not mean that the day may lack any notable price movements.

Already following on from a Friday which gave corn its best close in Chicago in four months, wheat in one month and saw soybeans temporarily touch a four-month high this session has seen rubber hit it highest for, um, two weeks in Tokyo, at 235.40 yen a kilogramme.

The contract later eased back to 234.90 yen a kilogramme, up 0.6% on the day.

China stocks ease

The rise was helped by data showing a small fall, of 206 tonnes to 207,452 tonnes, in the week to Friday in inventories of the tyre ingredient in China, the top importing country.

This after strong imports last month, estimated at 23% by Chinese customs data.

The price increase defied weak data from Japan itself, where data showed that Japan's economy expanded at an annual rate of 1% in the October-to-December quarter, missing forecasts of 2.8% growth.

Still, as an extra fillip to futures - which two weeks ago hit 210.00 yen a kilogramme, the lowest since August 2012 - the International Rubber Consortium recommended that its members, in the big three producing countries of Thailand, Indonesia and Malaysia, restrain selling.

"The last time the three members acted together was back in 2012-13, when they acted in tandem to reduce exports by 3% of global production in 2012," said Phillip Futures.

Price outlook

The Singapore-based broker added that it was expecting rubber prices "to be supported" this week.

"A drawdown in rubber stockpiles in China, coupled with continued firm imports, would support rubber prices," Phillip Futures said

"However, gains could be limited by worries over weakness in economies.

There have been persistent worries about the slowing down of the Chinese economy which had taken a toll on rubber prices. But Japan's economic growth is in question now."

Export revival

Elsewhere in Asia, Kuala Lumpur palm oil has not managed to match Friday's intraday high of 2,688 ringgit a tonne, just 4 ringgit a tonne from matching a 17-month high.

But it was, up 0.5% at 2,677 ringgit a tonne at 09:30 UK time (03:30 Chicago time), up 0.2% on the day, on course for a fifth successive positive close.

Prices have been supported by - besides concerns over dryness damage to crops in Brazil, the top exporter of soybeans, the source of soyoil ideas of a strong recovery in Malaysian palm oil exports.

Shipments from the second-ranked exporting country soared 32% in the first half of this month, according to Intertek, with data from rival cargo surveyor Societe Generale de Surveillance due later.

Strength in the ringgit, potentially hampering furture exports, plus data on Friday showing a sharp drop in Indian imports, from 1,067,709 tonnes in December to 905,814 tonnes last month, are keeping a lid on sentiment.

Soybeans slip

Oilseed prices were not so upbeat on the Dalian market in China, where soybeans for September fell 0.4% to 4,542 yuan a tonne for September, the best-traded contract.

Soymeal for May, the best-traded lot for the feed ingredient, closed 0.2% lower at 3,432 yuan a tonne.

The decline followed estimates from China's CNGOIC crop bureau that the country, the top soybean importer, will ship in more than 5m tonnes of the oilseed this month, up from 2.89m tonnes in February last year, and implying easier supplies of the crop.

Rains dampen sorghum market

In the grain markets, wheat for March closed unchanged at Aus$307.00 a tonne in Sydney.

But sorghum for March dropped 2.0% to Aus$325.30 a tonne, a one-month low, undermined by rains which have boosted prospects for the next harvest, which officials last week warned could fall sharply this season because of a lack of rainfall in the core east coast growing areas.

"Between 10mm-40mm of rain was recorded throughout much of New South Wales over the weekend," Luke Mathews at Commonwealth Bank of Australia said. 

"Follow-up rainfall is forecast throughout Queensland and northern New South Wales this week," with the former potentially receiving up to 150mm according to the latest eight-day outlook from Australia's Bureau of Meteorology.

RELATED ARTICLES
Evening markets: soy dips, eroding record premium to canola
LINKS
Agricultural Commodities
Agricultural Markets
Agricultural Companies
Agricultural Events