Have soybeans rediscovered their mojo?
Certainly the soy complex was top of the heap in early deals on Thursday, when Chicago's benchmark November contract took back its 75-day moving average.
'Harvest will grind to a halt'
Some of the strength is down to ideas of an interruption to the US harvest, whose supplies have been doing much to meet buyers' appetites and undermine prices.
Benson Quinn Commodities flagged forecasts of "rains spilling across the northern plains starting on Thursday that will halt progress for several days with amounts of 1 to 3" forecast for Minnesota, North Dakota and South Dakota over a 4 to 5 day rain event".
At Phillip Futures, Joyce Liu said: "Expected rainfall in the Midwest for the remaining of the week could slow down the harvesting of the US soybeans crop, providing some support to the soybean market for the next few days."
At Chicago broker Allendale, Richard Feltes said that the "trade is mindful that the late-week soy harvest will grind to a halt at a time when both exporters and crushers are clamouring for beans".
… for now
Not that all observers believe that the support will last very long.
"Rarely do we advance through the harvest season without delays, but the first slowdown in progress can generate support related to perceived production concerns," New York-based Jefferies Bache said.
"Harvest will resume quickly once soil firm and soybeans reach acceptable moisture levels, causing little concern about possible production losses."
Indeed, in Ukraine, where autumn rains have been dent progress on many crops, Agritel noted that "the harvest seems to have started again", with farmers focusing for now on soybeans and sunflowers.
However, there are some other reasons for investors to at least feel less negative on soybeans, with investors making much of the European Commission application for anti-dumping duties on imports of biodiesel from Argentina and Indonesia.
The direct beneficiary, in demand terms, should be European rapeseed.
"The absence of biodiesel imports could increase domestic EU production to cover its needs, increasing demand for raw products," Jefferies Bache said.
Biodiesel is made from vegetable oils, with rapeseed oil actually accounting for most European countries, although imported palm oil and soyoil do account for some feedstock.
Certainly rapeseed extended gains in Paris in early deals, adding 0.5% to E370.00 a tonne for November as of 09:50 UK time (03:50 Chicago time).
And the duties, the equivalent of E215-250 euros per tonne on Argentine product and E120-180 per tonne on Indonesian, are seen – in Chicago, at least – as discouraging Argentina from crushing its soybeans to product soyoil and soymeal.
Given that Argentina is the top exporter of both, that is viewed as boosting US prices of the soybean products, and in turn Chicago values of the oilseed itself.
Mr Feltes flagged the boost to Chicago soy market sentiment thanks to the "perceived reduction in the Argentine crush in the wake of EU imposition of import duties on Argentine biodiesel".
Soybeans for November gained 0.6% to $12.80 ¾ a bushel, with soymeal for December up 0.5% to $413.80 a short ton, and December soyoil up 1.0% at 39.78 cents a pound.
"The markets are oversold and with harvest activity coming to a halt for the next several days, market could continue to trend higher short term on technical correction," Benson Quinn Commodities said.
The palm oil market, meanwhile, took less succour from the news, with investors wondering whether Europe's move will actually mean more soyoil seeking homes in other markets, at a time when it is relatively competitively priced.
"The narrowing spread between palm oil and soybean oil is likely to cause some shift in demand to soyoil, as both are close substitutes in terms of food and biofuel uses," Phillip Futures said.
Palm oil for December eased 0.3% to 2,304 ringgit a tonne in Kuala Lumpur.
Soybeans' strength was reflected in part in prices of corn, for which the US harvest will also be interrupted by harvest rains, limiting the pipeline of near-term supplies.
And this at a time when ethanol plants, at least, have strong demand, as revealed by official US data (some of the few official US data which will be released this week) showing domestic production of the biofuel at up 5.2% week on week to 875,000 barrels a day.
(Some believe the increase was fuelled by capacity coming back onstream after maintenance.)
Corn for December added 0.2% to $4.39 ¾ a bushel.
'Hampered by wet conditions'
Still, it could still not keep up with fellow grain wheat, which added 0.4% to $6.88 ½ bushel for December, taking its premium nearly to $2.50 a bushel.
The grain continues to be underpinned by firm demand at a time when supplies of quality wheat have been depressed by disappointing harvests in the Black Sea, where rain is hampering autumn sowings too.
"Harvest in this region continues to be hampered by wet conditions, which won't let the issues concerning quality die down," Benson Quinn Commodities said.
"Despite global offers typically being cheaper into most destinations, the weakness in the US dollar's relationship to the euro is also a burden on EU and Black Sea values."
Hopes for the Argentine crop are modest too, following frost and dryness, while also continues to affect some parts of Australia.
"Crop production levels in parts of northern New South Wales and Queensland have suffered from continued dry conditions and the impact of frost events," Cargill's Australian AWB business said.
Sugar vs coffee
Among soft commodities, raw sugar fell back on profit-taking after closing the last session at a six-month high of 18.51 cents a pound for October delivery.
The sweetener is gaining support from "pessimism over the impact of rains on Brazil's cane output", Phillip Futures said.
The broker was less upbeat on prospects for arabica coffee futures, which edged 0.05 cents higher to 114.50 cents a pound in New York, for December delivery.
"Arabica coffee might have closed higher yesterday but we remain bearish as we recognise further downside to the market due to ample supplies following the huge off-year harvest in Brazil, the top grower of coffee.
Furthermore, Brazil's rains "bode well for the development of its on-year 2014-15 crop".
While the market would normally be expecting US weekly export sales data later, these look unlikely to be released thanks to the US government shutdown.
That leaves the next major data excitements in the calendar as Statistics Canada's crop figures due on Friday, when Informa Economics is expected to unveil fresh US crop estimates too.