Share markets are heading for their worst quarter in years, and the picture isn’t that pretty for many agricultural commodities either.
Many stock markets, such as New York’s, are looking at their worst performance since 2011.
The Hang Seng, while posting gains in afternoon deals on Wednesday, is looking at its worst drop since 2001.
And commodities, as measured by the CRB index, are lower for the quarter by some 15%, with one session to go, with many ags doing their bit to keep the mood negative.
Still, Kuala Lumpur palm oil, having set a six-year low last month and looking one of the complex’s lamest ducks, is actually on track for a firmly positive performance during the quarter, despite a 1.4% drop on Wednesday to 2,417 ringgit a tonne as of 07:15 UK time (01:15 Chicago time).
The vegetable oil has been revived by ideas of the weaker ringgit boosting Malaysian exports, making them more affordable to buyers in other currencies, while dryness, blamed on El Nino, and smog in major growing regions has undermined production prospects.
Indeed, the Malaysian Palm Oil Council on Wednesday said that Malaysian palm oil output, which typically peaks in September or October, may this year have hit its high in August.
And next year, domestic output could fall to 19m tonnes, from the 20m tonnes forecast for 2015, showing a rare decline.
Malaysian palm exports are seen as having risen this month too, by 0.5% from August according to cargo surveyor Intertek, to some 1.53m tonnes.
Still, that was lower than the pace of increase earlier in the month.
And there is nothing like the end of the month or quarter to inspire a bit of position closing and profit-taking, which for palm oil means closing long positions, which are showing a 21% gain for the month, and 8% gain for the June-to-September quarter.
Impressively, this recovery has come in the face of economic fears for China, a huge palm oil importer, too.
For Chicago grains too, ends of months and quarters are typically associated with position closing and cash withdrawals.
But any such trend this time may be overshadowed by the findings of the US Department of Agriculture’s quarterly data on domestic grain inventories, to be released later.
Such reports are often big market movers, although it has to be said that there are no great expectations of the report causing much of a change in the price trend this time, particularly a positive one, given the large crops apparently being harvested.
OK, history suggests that the soybean stocks estimate, for September 1, will come in below market expectations.
But they will still be twice those of a year before, while corninventories will be up 500m bushels on last year and wheat’s up 150m bushels, said Richard Feltes at Chicago broker RJ O’Brien.
“There is nothing here to fuel a sustained uptrend” in prices, he said.
There are actually other data released on Wednesday too, notably on US wheat production, expected to show a marginal decrease, to 2.133bn bushels, on the USDA’s current figure.
And Mr Feltes flagged a “concern” that the USDA may trim its estimate for US wheat harvested area.
Still, wheat little changed in early deals, up 0.3% to $5.05 a bushel for December delivery, given some help on balance by weather factors.
Sure in the US, growers in the key southern Plains hard red winter wheat area are poised for “very important” rains, Terry Reilly at Futures international said.
“Producers across a large portion of hard red winter wheat country will have an opportunity to plant wheat after 100% coverage occurs Thursday through Saturday,” he said.
Also on the negative side for prices, “showers in Argentina this work week should continue to improve soil moisture for wheat”, although “more rain is needed in the western growing areas”.
However, World Weather said that while Russia’s southern wheat growing areas do have a chance for rain later this week “the majority of Russia and Ukraine’s grain growing areas will still trend drier over the next seven-to-10 days”.
And Australia’s canola, barley and wheat areas will trend drier and warmer through the first week of October, meaning that “plant stress is expected”.
For the US corn and soybean harvests, the weather outlook as moved a little more helpful to prices, in putting a bit of moisture in the eastern Corn Belt to slow fieldwork.
“Harvesting delays in the far eastern portion of the eastern Corn Belt will occur over the next 5-6 days,” Mr Reilly said.
And there are widespread reports too of farmers refraining from sales at current lower prices, taking some of the pressure off.
Still, ahead of the data, investors were reluctant to take too much of a lead, with November soybeans down 0.1% at $8.83 ¼ a bushel, although representing a loss of 16.4% for the quarter.
Corn for December was up 0.1% at $3.89 ½ a bushel, down 5.9% for the quarter.