Even palm oil futures fell.
Cargo surveyor SGS eased even further worries over Malaysian palm oil exports, saying earlier on Tuesday that the pace of month-on-month decline had slowed to just 1.0% as of March 15, from 18.4% as of March 10.
On Monday, Amspec Agri reported the March 15 pace slowing to 4.6%, while ITS had the figure at 4.4%.
Still, Kuala Lumpur palm oil futures tumbled nonetheless, following rival soyoil, which dipped in the last session in Chicago after US crush data for February from industry group Nopa was viewed by some commentators as indicating slightly lower use of the vegetable oil than might be expected.
The June palm oil contract, in its first session as the spot lot, shed 2.5% to 3,920 ringgit a tonne as of 10:00 UK time (05:00 Chicago time), and upsetting the vegetable oil’s crack at beating its record high set 13 years ago.
With profit-taking in the air, soyoil futures were weak too, although less so, easing by 0.3% to 54.91 cents a pound.
“Soyoil is starting to gain attention again, but for the downside,” said Terry Reilly at Futures International, noting ideas that “the Chicago [soy] products are due for a correction”.
Mike Mawdlsey at First Choice Commodities, noting that the last session had brought a “new high in bean oil but close lower”, asked whether prices of the vegetable oil were “getting toppy?”
One factor in favour of soyoil was the weekly regulatory data showing that funds had already cut their net long in the vegetable oil by more than had been thought, ie meaning less potentially selling pressure than had been factored in.
Mr Reilly noted too a “less-than-expected long speculative position”.
As for the other soy processing product, soymeal, that eased a more modest $0.10 a short ton to $407.30 a short ton, still scraping just ahead of its 100-day moving average, at $405.10 a short ton.
Meal has already corrected somewhat, after hitting a high two months ago of $463.60 a short ton, May basis.
Furthermore, the feed ingredient emerged relatively well from the Nopa report, which showed US soymeal exports, at 837,815 tons last month, rising year on year by 9.8%, despite the 6.7% fall in the soybean crush from February 2020.
Corn futures gain
Soybeans themselves for May edged 0.2% lower to $14.16 ¾ a bushel, feeling some pressure too from improvements in the weather in Argentina, where rains are refreshing dryness-tested crops – a factor weighing on corn too.
Still, not all influences are negative – and indeed Chicago corn for May added 0.3% to $5.51 ¼ a bushel, regaining the psychologically important $5.50-a-bushel mark.
From a technical perspective, “futures have tested the 50-day moving average the past three sessions - and held,” Mr Mawdsley said.
“Key is to get over $5.53 ¼ a bushel and then $5.60 ½ a bushel,” Fibonacci retracement levels, “before we get excited about testing the high again”.
‘Hope of new China buying’
Meanwhile, from a fundamental perspective, the prospect of a meeting between China and the US in Alaska is raising some ideas that a large Chinese purchase of US corn and/or soybeans might be in the offing.
Often, China has made big ag purchases just ahead of meetings with US officials, in what is seen as a token of goodwill (while of course giving China ag supplies it needs anyway).
This when there has been talk – but not confirmation - anyway of significant Chinese purchases of US corn.
“Some talk of… hope of new China buying,” ADM Investor Services, underlining that some investors “hope that China may buy some US ag goods before the meeting”.
Of course, the reports of China’s renewed outbreak of African swine fever are boosting worries that the country’s need for feed ingredients such as corn or soybeans (for making soymeal) might be less than had been anticipated.
Still, on Tuesday Dalian soymeal futures for May gained 0.8% to 3,221 yuan a tonne, reversing some of their recent losses, while corn for May added 0.5% to 2,710 yuan a tonne.
An extra indication of the health of China’s corn needs may come from a state auction.
“China is expected to auction off corn this week, giving the trade an indication of current feed demand,” Mr Reilly said.
Corn’s outperformance helped it reduce anew its discount to rival grain wheat, which in Chicago dipped 0.6% to $6.41 a bushel for May.
Indeed, the discount at some $0.90 a bushel is close to contract low, May basis, and well below October’s high of $2.14 a bushel.
Wheat felt pressure from USDA data overnight showing improvement in the winter wheat crop in the southern Plains, thanks to rains which are expected to show up in data next week too.
The Kansas reading rose by 2 points week on week to 38% good or excellent, and the Oklahoma one by 4 points to 57%.
Kansas City hard red winter wheat, as grown in the southern Plains, dipped by 1.0% for May to $6.01 a bushel.
Russia to ditch wheat export taxes?
Also weighing on wheat prices were ideas that Russia might step back from export-curbing measures, with Agriculture Minister Dmitry Patrushev saying that "as soon as the situation stabilises, we will be ready to consider various other approaches to regulating this market, including the exclusion of any interference at all.
"But for now we must make sure that all of our grain is not exported abroad. This is extremely important," he added, according to Interfax.