agrimoney.com (19/10/2017) - Agricultural commodities found their feet a bit even as the equity rally faltered.

Share markets were uneased by caution by Zhou Xiaochuan, on the sidelines of the 19th Communist party congress, that China faced a possible "Minsky moment", as in a collapse in asset prices, sparked by debt or currency pressures, after a long period of growth.

Whether or not some of that money found its way into ag markets, there was fundamental cause for gains in some contracts, helping hand the Bcom ag subindex its first winning session this week.

Oil floats

The headway in coffee markets is reported elsewhere on Agrimoney.com.

But other winning contracts included soyoil, which added 1.2% to 33.41 cents a pound in Chicago for December delivery, after some upbeat comments overnight on prospects for rival palm oil.

Technical factors helped too, as the contract overtook and then held its 100-day and 200-day moving averages, which it ended above for the first time in nearly a month.

And there was a prop to the biofuels sector, a big users of vegetable oils, from Iowa governor Kim Reynolds, who said that Donald Trump, the US president, had told her of his commitment to biofuels.

This at a time when a proposal to erode the strength of the US biofuels mandate is concerning the farm lobby, and investors.

'Support looks to be holding'

Among Chicago's big three contracts, wheat futures for December reversed earlier losses to close up 0.6% at $4.32 ¾ a bushel, recording their first winning session of the week.

The gains reflected a couple of factors including data showing strong US export sales last week, at 615,400 tonnes, more than triple those the week before, and above market expectations of at best 450,000 tonnes.

Export sales of hard red spring wheat, at 251,000 tonnes, were noticeably strong, and helped Minneapolis spring wheat futures for December also post a positive close, up 0.6% at $4.32 ¾ a bushel.

 "Support in the spring wheat looks to be holding," said Benson Quinn Commodities.

"Every day that goes by appears it appears no one willing to push it lower."

Gasc tender result

The US export data took some of the attention away from a further victory by Russian wheat at a tender by Egypt's Gasc grain authority.

The authority bought 230,000 tonnes of Russian wheat at an average price of less than $199.00 a tonne excluding freight, underlining the origin's competitiveness on export markets, and taking to 2.72m tonnes the volume of Russian wheat Gasc has bought at tender for 2017-18 delivery.

(It has bought a total of 3.67m tonnes).

And this as SovEcon raised its forecast for Russia's 2017-18 wheat exports by 1.5m tonnes to 33.9m tonnes.

Paris wheat, closer to the action, could only hold its ground, ending unchanged at E161.50 a tonne for December delivery.

'Bids steady to firmer'

But Chicago wheat also had help from a downgrade by Informa of some 350,000 tonnes to 32.173m tonnes in its forecast for US winter wheat sowings ahead of the 2018 harvest.

Informa cut too its forecast of US corn sowings next spring, by 420,000 acres to 90.46m acres.

And, with US corn export sales last week, at 1.25m tonnes, ahead of expectations of at best 1.10m tonnes, Chicago corn futures for December closed up , albeit by a modest 0.1% at $3.49 a bushel.

CHS Hedging added that on the US cash market, "spot basis bids for corn are steady to firmer at elevators and processors around the US as farmer sales have been light with many bushels going into storage or delayed price programmes".

'Bulls may need to wait'

The US export sales data for soybeans were somewhat disappointing, coming in at 1.28m tones, just below the bottom end of market expectations, and well below the 1.75m tonnes the week before.

Also on the negative side for prices, Informa lifted by nearly 1.3m acres, to 90.35m acres, its forecast for US soybean sowings next year.

Still, besides help from the strong soyoil market, soybeans also got help from a separate announcement of the sale of 384,000 tonnes of soybeans to China, easing worries over the fall in China's own soybean prices, as illustrated by tumbling Dalian futures.

That said, Richard Feltes at RJ O'Brien said that he was "unable to identify a compelling need for the soy market to rally into month-end, with an active US harvest, improving South American weather and inability of November futures to take out last week's $10.03-a-bushel high.

"Bulls may need to wait until cash markets tighten up" following the completion of the US harvest.

November soybean futures closed up 0.2% at $9.86 ½ a bushel.

'Plentiful supply'

In New York, cotton futures bucked the positive trend, closing down 0.5% at 67.31 cents a pound for December delivery, despite decent US export sales of 253,200 running bales of upland cotton, up 64% week on week.

"Plentiful supply is pressuring prices," Commerzbank said, noting a faster-than-average US harvest.

"In Texas, the most important growing state, it is even ahead by eight percentage points," the bank said, quoting USDA data earlier this week.

It also flagged that the world cotton market is poised to "show a surplus for the first time in three years, driving up global cotton stocks.

"Stocks in the leading export countries look set to grow by 6m bales, half of this total in the US."