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Morning markets: bullish wave helps crops march on

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Crops remained in the ascendancy – just – as the dollar continued to weaken and the global round of equity gains continued to Asia.

Tokyo shares closed up 1.1%, while Hong Kong stocks were up 1.9% by the midday break, following gains in Europe and Wall Street on Tuesday.

The dollar, meanwhile, edged lower against most major currencies, as investors' appetite for risk once again proved greater than their desire for the safe haven of the greenback.

With oil up 0.8% at $71.43 a barrel, the lights from external markets showed green for an improvement in food commodities, which managed to make something of the opportunity.

'Frost and freeze conditions'

Corn, which has gained the most focus in recent days, was the weakest of the big crops, standing just 0.5 cents higher at $3.58 ¾ a bushel at 06:10 GMT for Chicago's December contract.

The US still looks to be on for a cold snap this weekend, to judge by the latest weather forecasts, with Meterologix predicting for the Midwest "frost and freeze conditions likely developing early Saturday through western and north-western areas, below normal Sunday with frost and freeze conditions for the northern half of the region".

However, traders are still expecting a bumper harvest, and for Washington to raise yield estimates in Friday's monthly global crop supply and demand report.

Wheat for December was 3 points higher at $4.63 ¼ a bushel. It has now put a good distance in time – nearly a month – and some cushion in price since hitting a two-year low of $4.25 ¼ a bushel, amid thoughts that it has been punished enough for huge supplies.

Soybeans for November were 1.25 cents higher at $9.11 ¼ a bushel, consolidating their position after jumping back above $9 a bushel in the last session.

Palm springs

Palm, which closed at its lowest for nearly three months on Tuesday, played a little catch up with US food commodities, rebounding 1.8%.

Nonetheless, many traders remained gloomy on the outlook, crediting short-covering rather than any fundamental appetite for a big part of the rise.

With China sidelined by a week-long holiday, focus has turned to Malaysian export data from cargo surveyors due on Monday, which is not expected to make pretty reading. China is the world's biggest palm oil buyer.

Benchmark December palm oil closed the morning session on the Bursa Malaysia derivative exchange up 36 ringgit at 2,098 ringgit a tonne.


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