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Morning markets: dollar's loss proves crops' gain

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The dollar came to food commodities' aid on Thursday, weakening a little to help Chicago crops overcome some continuing turbulence in share markets.

Chinese shares slid for a second day although, at 1.2%, the decline was a considerable improvement on the 5% drop that got investors fretting on Wednesday.

Oil, which lost nearly 6% in the last session, followed a similar pattern, down a modest $0.13 at $63.22 a barrel at 06:15 GMT.

At least the greenback was supportive, dropping 0.4% to 79.345 against a basket of currencies, so making commodities traded in dollars appear cheaper.

Dead spread

Short-covering helped too, as in the last session when the unwinding in Chicago of losing bets on near-term August soybeans going lower improved the contract's strength, allowing it to sidestep general market weakness.

The contract remained in demand, adding 14.5 cents to $10.72 ¼ a bushel, taking its gains since a mid-July low above 10%.

This time, new crop lots strengthened too, with November up 10.25 cents at $9.26 ¼ a bushel.

Export aid

Technical factors were also credited for helping corn and wheat higher, with traders nervous at the potential for US export sales figures due later to surprise encouraging short-covering.

Corn was helped earlier this week by booming export inspections statistics.

Corn for September was 1.5 cents higher at $3.22 ¼ a bushel, with wheat for the same month up 2.75 cents at $5.14 ¼ a bushel.

UK farmers will be hoping the optimism crosses the Atlantic, after London wheat closed the last session within an ace of slipping back below £100 a tonne.

Palm lifted

In Kuala Lumpur, palm oil was also a touch higher, helped by soybeans, although trade remained a little nervous ahead of export data.

Intertek Testing Services and Societe Generale de Surveillance, the cargo surveyors, will on Friday unveil estimates for Malaysia's July palm oil exports.

Benchmark October palm oil closed the morning session on Bursa Malaysia's Derivatives Exchange up 5 ringgit at 2,118 ringgit per tonne.

By Agrimoney.com

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