PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 19:58 GMT, Tuesday, 18th Apr 2017, by William Clarke
PM markets: corn prices ease, as traders dismiss rain risk

Corn prices got some support last week on a wet forecast for the US Midwest, with ideas that it would delay planting, but it appears that investors are no-longer buying that story.

It is true that US crop data showed planting is lagging last year, particularly in the Midwest.

Across the US, corn planting is now 6% complete, lagging the average pace of planting by three points, and last year's pace by five points.

Corn planting in the Delta region is nearly complete, but is lagging across the Corn Belt, particularly in Missouri, where plantings are lagging last year by 33 points, at 17%.

Warm temperatures to help germination

And conditions in the near future are likely to continue slowing sowing.

But markets turned lower, on ideas that delays are not going to be a severe as thought late last week, and not something to worry about.

"Wet weather across most of the Midwest over the next week should slow planting, but northern Illinois and south-eastern Iowa may miss out on the heaviest rains, which could limit delays in those locations," said Kyle Taply, at MDA Weather Services.

"Above normal temperatures in most areas will favour corn germination," Mr Taply.

'Tough story to buy'

"While the conditions for corn planting over the next couple of weeks aren't ideal, I do think that the slow planting pace story is a tough one to buy at this time," said Brian Henry, at Benson Quinn Commodities.

" If the forecast through the first week of May doesn't show better potential for planting, the market will likely have to respond to some degree," Mr Henry noted.

But he pointed out that "the 6 to 10 day forecast looks OK for the bulk of the country".

"Obviously, there is little interest in buying a US delayed planting rally," agreed Darrell Holaday, at Country Futures.

May corn futures finished down 1.3%, breaking back below the 200-day moving average, at $3.61 a bushel.

Chinese soy complex weighs on Chicago

Soybean prices also came under pressure, after a sell-off in the Chinese soy complex based on ideas of higher production there.

Markets are still absorbing bearish data on March soybean crushing released in the previous session.

And if US corn plantings can be done in a timely fashions, as investors are assuming, then there is a better chance of soybean planting being completed in the optimum window as well.

May soybean futures finished down 0.8%, at $9.46 a bushel.

Weaker dollar raises export hopes

Wheat condition improved from last week, as expected, with winter wheat progress ahead of the average pace.

But the effect of prices was limited by the previous session's sell-off, which factored in that bearish news.

And export hopes helped keep markets steady, as Kevin Stockard CHS Hedging, suggested that "the recent break in futures and lower dollar should make us competitive in exports markets this week".

May Chicago wheat futures finished up 0.4%, at $4.22 a bushel.

Sugar finds traction

Sugar futures bounced back from near-on-year lows touched earlier in the session.

Conab forecast Brazilian Centre South production to ease slightly, despite mills favouring sugar over ethanol, thanks to lower cane area Sao Paolo state.

July raw sugar settled up 1.9%, at 16.83 cents a pound.

ICE confirmed 137,500 tonnes of white sugar were delivered against the expiring May contact last week, all going to trader to ED&F Man.

August white sugar futures settled up 1.2%, at $475.90 a tonne.

Coffee rallies despite big consumer stocks

Coffee prices rose despite Green Coffee Association data released late on Monday, which showed US green coffee stocks in March at highest level since at least 2001.

"It is so far, the evidence of these North American stocks that accompany similar reports of relatively high levels of stock being held within Europe and Japan, that continues to side-line the many forecasts of deficit global coffee supply for the coming year," said South African trade house I&M Smith.

But I&M Smith suggested that the forecast tightening producer bloc coffee supply is "related to the assumption of perfect weather conditions, which is often an unlikely scenario and does leave the markets open to a potentially sharp speculative reaction to any unforeseen weather issues developing for any of the main producer blocs over the coming months".

July arabica coffee settled up 1.4%, at 145.55 cents a pound, the highest for the second-month contract since March 22.

May robusta futures settled up 0.8%, at $2,190 a tonne.

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