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Evening markets: corn picks up while hogs wallow

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Turnaround Tuesday, pah. Corn recovered from early weakness to crawl back into positive territory, defying forecasts of a reversal following Monday's strong gains.

External considerations did their bit, with US home sales rising much more than predicted in June, fuelling hopes for a recovery in the world's biggest economy.

Indeed, that underpinned shares and kept a lid on the dollar, which has tended to weaken on good economic news as greater confidence encourages investors to spread their wings.

A cheaper dollar, which stayed near its 2009 low, is good news for dollar denominated commodities, making them more affordable abroad.

Weather concerns

But there were some agricultural considerations to factor in too, including the prospect of warmer temperatures in the US – which might spell enhanced crop development in some areas, but drought stress in others where rainfall has been short.

Chicago corn for September stood 0.75 cents higher at $3.58 ½ a bushel at 17:00 GMT.

Still, soybeans, which have been corn's leader in a recent rally, did find it harder to hold on to positive ground, standing 2.5 cents lower at $11.71 for August delivery, although new crop contracts did retain small gains.

Besides short-covering, beans have the uncertainty which accompanies China's weekly bean auctions to deal with, the next being on Wednesday.

Wheat weak

Still, that was a better performance than wheat, which shed 6 cents to $5.43 ¼ a bushel for September delivery.

The weakness followed forecasts of gigantic yields by the Wheat Quality Council, with some talk of upgrades to Russia's crop too.

European contracts were weaker too, albeit less so, with London wheat for September down £0.25 cents at £104.00 a tonnes, and its Paris equivalent off E1.00 at E129.00 a tonne.

Rapeseed at least managed a small rise, up E0.25 at E277.75 a tonne to put more distance between it and last week's contract low.

Earlier, its vegetable oil rival, palm oil, gave up gains of more than 2% to close just 9 ringgit higher at 2,304 ringgit a tonne, with weakness in crude markets blamed for the drop.

New York crude for September stood $0.07 lower at $71.51 a barrel.

Hogs in a trough

More spectacular losses were sustained by Chicago hogs, which continue to be undermined by lower pork prices, yet higher animal weights.

October hogs slipped 2.2% to 50.90 cents a pound, the lowest since 2007 for a nearest-but-one contract, with August hogs off 1.3% at $54.25 a pound, the lowest since November last year.

Among softs, fund buying helped New York cocoa join sugar on the winner's list, with New York's September contract up $15 at $2,950 a tonne.

London cocoa for September marked time, however, ending down but £1 at £1,810 a tonne.

By Agrimoney.com

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