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Morning markets: soybeans rise as grains mark time

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Soybeans proved the leader of the pack in early deals on Thursday as wheat and corn, the better performers of late, paused for breath.

The dollar provided some help for US exports by easing a touch against a basket of currencies.

That in part reflected a stronger Australian dollar after jobs data added to the soaring gold prices in boosting the currency of a country strongly linked to commodities prices.

It was also down to acknowledgement by China's central bank that the country may need a stronger renminbi.

The euro strengthened a touch to just under $1.50 as of 07:30 GMT.

Huge fund orders?

There are also rumours of significant fund buying ahead.

"Three major index funds are expected to buy a total of 18,000 contracts of soybeans, 25,000 contracts of wheat and 65,000 contracts of corn in the month of January," EHedger, said.

Still, that may have seemed a long way away on November 12.

December wheat eased 0.75 cents to $5.31 a bushel in Chicago, with corn for the same month down 1 cent at $3.93 a bushel.

Bear case

Soybeans did best, up 4 cents at $9.67 ¾ a bushel for November and 3.75 cents to $9.75 ¾ a bushel for January delivery, and this despite improved US forecasts on Tuesday for America's production, and good, if late, harvest progress.

"2010 soybeans look very expensive," eHedger said.

"An early start to the Brazilian growing season will likely take away export business much sooner than normal.

"We should see export out of Brazil as early as February 1 and nearly all exports originating from South America by March 1.

"Global protein demand continues to be a concern due to a decrease in animal numbers and an increased use of alternative feed ingredients."

It may be beans were playing a little catch up given its weak performance over the last two months – down 1.7% - compared with wheat, up 20%, and corn, up 25%.

Flood factor

Also in the vegetable oil market, palm oil put in a good show in Kuala Lumpur, trading up 1.4% at 2,266 for January delivery.

Forecasts of heavy rains, which may put the brakes on a jump in production, helped palm pull out of a two-day losing streak.

Malaysia is experiencing is monsoon period, which typically bring floods to many areas.


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