There was one good reason for investors in farm commodities not to bail out on Monday, and that was that US markets, the global pace-setters, were closed.
And Chicago and New York crop futures have, in many sessions, over the past few weeks, proved remarkably resilient to sell-offs in other risk assets.
If it were not for that – well, the day provided plenty of excuses to quit, the main one being a headlong rush from the likes of shares not seen for at least, ooh, a couple of weeks, spurred by fears for the US economy, and with eurozone debt concerns back bleeping on the radar.
London’s FTSE 100 share index closed down, Frankfurt stocks down 5.3% and Paris shares down 4.7%.
Also caught up in the carnage were oil, which tumbled 3.3% to $83.60 a barrel for West Texas Intermediate, and copper, which fell 1.3% in London.
Meanwhile, the dollar, regarded as a safe haven, added 0.6% against a basket of currencies.
‘Record yield’
And heading into Europe’s grain markets, there were reasons on fundamentals to get bearish too.
In France, Arvalis said that its corn crop would produce a record yield of about 10 tonnes per hectare, reflecting early sowings and, more recently, regular rains.
"This could offer some respite for the European Union feed compounder, with corn stocks tightening and production in the US suffering," the UK grain arm of a major EU commodities house said.
This when expectations for the corn crop not far away in Ukraine are rising too, with a record looking likely to be set by a margin.
Quality question
Elsewhere, the UK knocked hopes for milling wheat premiums by coming in with a shining preliminary estimate for the quality of its overall wheat crop, in contrast to the hardships faced further east in Germany.
Still, further east of that, harvest results from Latvia and Lithuania show "protein levels have held quite well, with average levels above 14.5%", although Hagberg falling numbers, a measure of starch content, "have disappointed", Jaime Nolan at FCStone’s Dublin office said.
And the UK merchant said that "in any case we are now seeing offers of high quality wheats from the most unexpected places – both Sweden and Finland have surpluses which are being offered onto the export market".
The good news for feed wheat is that at least here EU values are competitive with Ukrainian ones, which are usually seen as price leaders, although less so since the country implemented export duties which it is reluctant to shift for now.
Indeed, Ukraine export data showed grain exports for July and August, the first two months of 2011-12, at 1.8m tonnes, down 22% year on year. (That said, this does imply quite some pick-up from the especially dismal July.)
London feed wheat fell 1.6% to £170.20 a tonne for November delivery, while Paris milling wheat for November ended down 0.7% at E206.75 a tonne.
Also in Paris, rapeseed for November fell a modest 0.9% to E437.50 a tonne, supported by limited weekend rains for the US crop of soybeans, the rival oilseed.
‘Very helpful climatic conditions’
Among soft commodities, London white sugar failed to move too far from Friday’s levels without a signal from New York raw sugar, and moved largely in line with the currency.
October white’s finished down 0.4% at $750.80 a tonne.
However, robusta coffee, which has looser ties to New York arabica beans, proved more bold tumbling 3.6% to £2,194 a tonne for London’s November contract, sapped by growing pressure from Vietnam’s forthcoming harvest.
ABN Amro last week highlighted the potential for the Vietnam, the biggest robusta producer, to lift its output by 1.5m bags to 21.5m bags in 2011-12.
"The coming crop is expected to have benefited from very helpful climatic conditions as well as farmers’ improved financial standing following consistently good prices," the bank said, in a report produced in conjunction with VM Group.
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