LONDON (Commodity Online): Most of the agricultural commodities prices suffered corrections on the day with the exception of corn and wheat despite a slew of better than expected US macro data releases. US auto sales in Q3 registered a 12.4% annualized increase from Q2 levels, which supports our economists’ view that the pace of overall consumer spending will be noticeably stronger in Q3 than Q2.
However, agricultural prices could not gain much upward momentum on the day. CBOT corn prices finished flat on the day, while the prompt contract of CBOT wheat inched up by 1.68%. In contrast, soybean prices edged lower by 0.13%. The weather outlook appears mostly favourable for harvesting corn and wheat in the next 10 days in the US Midwest. Dryness and seasonally normal temperature should allow farmers to make good progress for the harvest.
Yesterday evening's USDA's weekly crop progress report shows that corn and soybean crop conditions were relatively unchanged from the previous week, while winter wheat planting has made significant progress. Around 42% of the winter wheat crop has been planted for the week in reference, a big improvement from the previous report that showed only 26% of the crop was planted, although planting was still 10% below year-ago levels.
Among the ICE soft commodities, cocoa dropped 1.27%, coffee fell by 2.38%, while cotton and sugar finished lower by 0.97% and 5.66% respectively. Ivory Coast's (the world's largest cocoa producer) cocoa sector body CGFCC has proposed a guaranteed price system scheme for local farmers. Under the scheme, the bulk of each year's cocoa crop will be sold in advance by a system of allocation or auction.