25/04/2013 (AgriMoney.com) - What on earth is going on with Malaysian palm oil exports?

As of April 10, they were running 3.5% higher, month on month, according to cargo surveyor Intertek Testing Services.

By April 20, that had turned into a 4.9% decline from the first 20 days of March.

Now, five days on, they are running 5.2% ahead again, reaching 1.12m tonnes, according to Intertek.

Price recovery
Did a huge palm oil shipment just leave the second-ranked producer, and exporter, of the vegetable oil?

Investors were certainly relieved at the uptick in volumes, sending Kuala Lumpur palm oil futures for July up 0.8% to 2,307 ringgit a tonne as of 09:45 UK time (03:45 Chicago time), putting a bit of distance between itself and its low reached earlier this week.

On Monday, palm oil touched 2,250 ringgit a tonne, within 40 ringgit of levels not seen since November 2009.

"Palm oil prices might be buoyed because of technical buying," Phillip Futures said, adding that "strong crude oil prices might support the upward movement too", after a 2.5% rise in New York crude on Wednesday.

Palm oil, as a biodiesel feedstock, is influenced by energy prices.

Not that Phillip Futures was upbeat over palm oil prospects, saying that its own chart analysis left it "looking for crude palm oil prices to continue trending downward unless resistance level at 2,500 ringgit a tonne is broken above".

Soy recovery
The rebound was also symptomatic of a somewhat better performance by the oilseed sector, after declines in the last session amid growing fears over the impact on China's important import appetite of economic slowdown and the spreading bird flu epidemic, of which a case has been found in Taiwan. (Another broker echoed the caution reported by Agrimoney.com on Wednesday, warning that "before the end of the year we may see more cancellations of soybeans going to China".)

But with soymeal, at least, recovering ground on China's Dalian exchange, adding 0.8% to 3,149 yuan a tonne for September, and US basis still strong, buyers recovered some appetite for sector.

Soymeal itself in Chicago added 0.7% to $393.20 a short ton for July delivery, in line with July soybeans, which gained 0.7% to $13.55 a bushel.

Soyoil, palm oil's vegetable oil rival, stood 0.5% higher at 49.16 cents a pound.

Signs of demand
Corn too posted gains, extending its recovery of the last session, helped by further signs of demand, with South Korea's Korea Corn Processing Industry Association, Kocopia, buying 55,000 tonnes of optional origin supplies for August delivery, at a price believed to be about $295 a tonne on a cost and freight (CFR) basis.

"That pencils in as their cheapest purchase over the past 10 months," Benson Quinn Commodities said, even if the grain may well come from South America, with other buyers lured by weaker prices including Israel, which bought 100,000 tonnes of corn on Wednesday, plus some feed wheat and barley.

With US ethanol production data firm too, coming in at 853,000 barrels a day last week, up 23,000 barrels a day on the week before, signs of demand helped old crop July corn edge 0.2% higher to $6.19 ¾ a bushel in Chicago.

'Rain may be back'
The new crop December contract lagged, up 0.1% at $5.28 ¾ a bushel, amid continued dispute over prospects for the new crop.

Lanworth on Wednesday raised its estimate for the yield to 158.1 bushels per acre, from 155.8 bushels per acre, citing the boost from recent rains in soil moisture terms.

But will the weather really dry out in the coming week, to allow farmers to catch up on slow planting progress and make headway getting the crop in the ground?

In Iowa, the top corn-producing state, Mike Mawdsley at broker Market 1 said: "Weather models looked good here for a week. Now, looking ahead, it appears rain may be back in our neck of the woods by next Tuesday/Wednesday and again Friday.

"Corn seems to be trading that the Corn Belt will get in all in the ground next week. I don't think so.

"If those rains manifest it will likely be the week of May 6-10 before any serious planting is done," with May 10 commonly seen as the planting cut-off, sowing after which comes with a yield penalty for corn.

Chinese purchases ahead?
Wheat, meanwhile, had a particular demand boost with reports that Beijing, having stocked up on US wheat in recent weeks, may be back for more to top up reserves whose usefulness is impaired by poor quality.

Some stocks of 2010 wheat are said to be in bad condition, having been stored poorly, with some lingering concerns over last year's crop too, which some believe was far smaller than official figures indicate, thanks to an outbreak of fusarium.

Ma Wenfeng, an analyst atBeijing Orient Agribusiness Consultant, said that "we expect another 2m-3m tonnes of imports because authorities are very worried about the volume of deteriorating wheat among state stocks."

Furthermore, besides Israel's purchase of 45,000 tonnes of feed wheat announced on Wednesday, Jordan re-emerged with a fresh tender for 100,000 tonnes of milling wheat, although it has had a habit of late of passing in the hope of lower offers ahead.

'Optimal is not an option'
This time it was Chicago soft red winter wheat, the whipping boy of the last session, which did best among US contracts, adding 0.6% to $6.96 a bushel for July.

Kansas hard red winter wheat for July rose 0.5% to $7.44 a bushel, underpinned by ideas of damage from recent frosts in the southern Plains, but awaiting confirmation from the Wheat Quality Council's annual three-day tour of Kansas fields, which starts on April 30. (It's that time of year already.)

Minneapolis spring wheat lagged this time, up 0.4% at $8.05 a bushel, caught between farmer plans for huge sowings in Canada and the idea that lingering snow, and then flooding from snowmelt, will prevent many of these plantings.

"Weakness in Chicago and Kansas would be a burden on the Minneapolis market, but I expect some risk premium to remain in the Minneapolis market, until some planting progress is made, despite ample old crop supplies," Brian Henry at Benson Quinn Commodities said.

"In most areas, optimal is not an option, but things will look better once the snow is gone."

Softs data
Among soft commodities, London robusta coffee beans made a firm start, adding 0.4% to $1,995 a tonne for July, after Vietnam, the world's largest producer of the bean, estimated its exports this month down 35% year on year at 110,000 tonnes.

London cocoa for July rose 0.5% to £1,557 a tonne, despite data overnight showing Asia's cocoa grind falling 10.8% to 140,062 tonnes in the first quarter of the year.