by Agrimoney.com
It pushed and it pushed, but couldn't quite get there. And ended up retreating.
The high for Chicago's best-traded corn lot, December, is $7.22 ¾ a bushel, set in June, the last time concerns over the thinness of US supplies of the grain peaked.
On Friday, it reached its highest since, $7.20 a bushel, but failed - in early deals at least - to lift the bar higher, despite the boost from Thursday's downgrade by US Department of Agriculture officials to their estimate for the domestic corn yield, and harvested area, this year.
Indeed, the theme of a more muted reaction than might have been expected to the data, and a bigger-than-forecast downgrade to the US soybean crop too, looked only more relevant on Friday.
All three of the Chicago major crops fell in early deals.
Crude eases
One downer was the performance of external markets, which failed to react quite as might have been expected given a bounce of more than 3% in the Dow Jones Industrial Average overnight, helped by data showing a 395,000 drop in the number of claimants of US unemployment benefits last week, to a four-month low.
Tokyo's Nikkei index closed 0.2% lower, while New York crude dipped 1.7% to $84.30 a barrel as of 07:25 GMT (08:25 UK time) amid concerns for what the dip in sentiment fostered by the recent market mayhem has done for demand.
Other reasons proffered for soft markets included the day of the week, with investors cautious in such volatile times ahead of the weekend break, and a ban by some eurozone countries - France, Spain, Belgium and Italy - on short-selling financial stocks, in an effort to protect their banks.
Such moves have a rich history of highlighting the severity of the situation rather than promoting calm.
Furthermore, the dollar made headway against a basket of currencies, by 0.3%, making dollar-denominated assets less affordable as exports. (However, China may be an exception, see below.)
'Outlook remains rangebound'
And in crop markets there was some caution too over taking too much of a lead from Thursday's USDA data with much of the season yet to go for spring-sown crops.
For soybeans, for instance, the "price outlook remains rangebound from $13.00-14.00 a bushel till more is known about US crop production in September or October", Kim Rugel at Benson Quinn Commodities said.
For wheat, many analysts voiced a positively downbeat stance, given that the USDA downgrade to hopes the US crop was more than offset by better prospects elsewhere, notably in the former Soviet Union.
"World wheat projections were bearish for prices," Luke Mathews at Commonwealth Bank of Australia said.
"The USDA lifted global production by some 10m tonnes this month and ending stocks were lifted by about 6m tonnes to a comfortable 189m tonnes."
At, Standard Chartered, Abah Ofon said: "We remain fundamentally bearish wheat into the end of the year, although wheat prices are likely to benefit from bullish sentiment in corn."
Yuan factor
As for overnight news, the China National Grain and Oils Information Centre lifted its estimate for China's corn harvest by 1m tonnes to 182.5m tonnes, potentially a negative for prices. (The USDA on Thursday pegged the figure at 178.0m tonnes).
However, the centre cut its forecast for the soybean harvest by 500,000 tonnes to 13.5m tonnes, below the USDA's 14.0m-tonne figure.
And, in what might be seen as an extra boost for crops – such as soybeans - of which China is an importer, the country again pegged the yuan higher, at 6.3972 yuan per $1, its sixth record high in 10 trading days.
"This accelerated appreciation [of the yuan], both against the dollar and on a trade-weighted basis, marks an important shift after a recent slowdown," StanChart said.
Prices fall
Nonetheless, Chicago soybeans for November fell 0.3% to $13.28 a bushel, while corn for December fell 0.2% back to $7.12 ½ a bushel.
Wheat for September fell 0.3% to $6.99 ½ a bushel.
To continue the contrarian theme, a notably good performer was cotton, which was served bearishly by Thursday's USDA data revisions, which put in a surprise upgrade to the US harvest, despite deep drought in Texas, America's top producing state.
Is cotton, of which China is like soybeans also the top importer, reacting better to yuan appreciation prospects?
New York's December lot added 0.8% to 97.25 cents a pound.
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