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Morning markets: return to fundamentals saps corn

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Weather was a major signal for crop investors on Thursday as, with external markets throwing few curve balls, fundamentals returned to the fore.

Not that the prospect of benign conditions in major US growing districts helped Chicago food commodity prices.

Indeed, warmer and drier weather in areas such as Illinois and Indiana was seen as helping farmers complete delayed soybean plantings. And just in time, ahead of the June 20 deadline, after which, perceived wisdom has it, yields drop by ½ a bushel an acre for every day of delayed planting.

July soybeans stood 4.5 cents lower at $12.01 ¾ a bushel in electronic trading at 06:30 GMT with the new crop contracts favoured by investors on Wednesday no better off. November beans, for instance, dropped 6 cents to $10.44 a bushel.

Wheat tops the table

Corn was even further depressed, as the prospect of favourable weather where it counted pointed to good yields for a crop which is currently in fine condition, official data earlier this week showed.

Many corn investors have been banking on a weather hiccup to send prices soaring, given the prospect of slim yields ahead.

July corn lost 4.5 cents to $4.01 ¼ a bushel, with forward contracts no better off.

That left wheat to take the baton by adding 1 cent at $5.67 a bushel for July delivery.

Palm slides

Weather was also a factor in Kuala Lumpur, where traders are on the alert for a return of the disruptive El Nino weather pattern.

However, their fears were insufficient to prevent the benchmark September contract on Bursa Malaysia's Derivatives Exchange slipping 16 ringgit to 2,359 ringgit a tonne in the morning session, narrowly ahead of a two-month low of 2,356 ringgit a tonne set earlier.

Data have shown siding exports of Malaysian palm oil exports and a recovery in stocks, with some analysts forecasting a long term rise in the country's production capacity thanks replantings.

in external markets, the dollar and oil were both steady. Tokyo shares closed down 1.4%.

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