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Commodity leaders stay ahead of the pack

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Palm oil and soybeans maintained their leadership over other agricultural commodities on Tuesday, hitting multi-month highs, as data showing tighter supplies continued to attract investors.

Bursa Malaysia's benchmark June palm oil contract surged 150 ringgit, or 6.4%, to 2,485 ringgit a tonne – its highest close since early September – with Friday's batch of bullish stocks and export data credited for the rise.

Volume was heavy too at nearly 23,800 lots compared with the typical 10,000 in a day.

Chicago soybeans touched a three-month high of $10.43 ½ a bushel , for the May contract, before retreating to $10.36 ¼ at 17:15 GMT, up 14.75 cents on the day, as investors continued to digest last week's US report of tight supplies.

Follow the leader

Other commodities were dragged along in soybeans' wake. Corn put on a better showing than of late, adding 6.5 cents to $3.94 a bushel, with wheat taking on 2.75 cents to $5.26 cents a bushel.

However, a stronger pound, which rose 1.5% to nearly $1.49, prevented Chicago's rise feeding through to London prices, which lost £1.00 to £107.00 a tonne for the May contract. Wheat for July 2010 shed £1.50 to £127.00.

Paris wheat prices trod water at E136.00 a tonne for the May contract, as a modestly stronger euro offset Chicago's positive vibes. Rape prices proved better able to shrug off the weak dollar, dragged E7.00 higher to E287.25 a tonne by the other bullish oilseeds.

Juice squeezes ahead

Among soft commodities, orange juice added a further 3.2% in New York to a fresh five-month high of 86.90 cents a pound as traders kept one eye on a potentially disappointing Florida crop of the staple Valencia variety.

However, sugar and coffee showed small declines. And cocoa resumed its downward path after data showing the steepest decline in European grindings since 2002. New York's benchmark May contract lost 3.4% to $2,490 a tonne.

By Mike Verdin

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