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Morning markets: Weaker Wednesday takes its toll

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Turnaround Tuesday gave way to Weaker Wednesday on agricultural commodities markets, with both Chicago crops and Kuala Lumpur palm oil dropping.

Some traders attributed the declines to profit taking. Certainly soybeans, which closed nearly 2.5% higher in the last session, and palm oil, which soared 6.0%, presented some gains to lock in.

Others pointed to the lower oil which, with biofuels markets growing, is increasingly viewed as a leading indicator of crop prices.

New York crude for August stood 1.2% lower at $68.41 a barrel at 06:00 GMT.

Corn scorned

Certainly, corn, a main feedstock for ethanol, was the worst off among the major Chicago crops, standing 0.8% lower at $3.86 a bushel for the July contract.

Good weather in US corn districts have also disappointed some investors, who were banking on a weaker harvest, at a time of weak American stocks, bringing a spike in prices.

July wheat did better, down 0.75 cents, or 0.1%, at $5.46 a bushel.

While decent harvesting weather in Kansas, America's biggest wheat state, has put a dampener on prices, they have already fallen 19% from a high at the start of the month.

Soybeans, meanwhile, lost 5.5 cents, or 0.5%, to stand at $11.73 ½ a bushel, with investors balancing the prospect of the tightest US stocks in 32 years with the prospect of higher plantings when the US releases updated statistics next week.

Traders expect high soybean prices and delays to corn plantings to have tempted many farmers to make a late switch.

Palm slips

In Kuala Lumpur, Bursa Malaysia's benchmark September contract closed the morning session down 1.3% at 2,257 ringgit a tonne.

Traders are still expecting some improvement in exports, a belief behind Tuesday's rally.

"But the market needs to take a breather," a trader told Reuters, the news agency."Expect further consolidation as export hopes have been largely priced in

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