Friday, December 3, 2010

20101203 1903 FCPO EOD Daily Chart Study.

FCPO closed : 3516, changed : +16 points, volume : lower.

Bollinger band reading : upside biased.
MACD Histrogram : rising, buyer having some exposure.
Support : 3500, 3470, 3450 level.
Resistant : 3550, 3620, 3650 level.
Comment :
FCPO recorded marginal gain with lower volume transacted on the last day of the 6th Indonesia palm oil conference as most industry expert having similar outlook with near terms bullish price movement following with second half 2011 price downward correction. Daily chart formed a doji bar candle near upper Bollinger band level with the reading remained suggesting an upside biased market development with possible pullback correction.
When to buy : buy at support and weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20101203 1845 FKLI EOD Daily Chart Study.

FKLI closed : 1501, changed : -2.5 points,  volume : lower.
Bollinger band reading : side way range bound.
MACD Histrogram : recovering, lack of participation from both buyer and seller.
Support : 1500, 1485, 1470 level.
Resistant : 1530, 1550, 1580 level.
Comment :
FKLI closed marginally lower recorded small loss with lower volume traded following major regional market traded mixed ahead of tonight U.S. non farm payroll data report. Daily chart formed a down bar candle after market opened gap up at the high of the day and sell down due to profit taking activities closed near middle Bollinger band support level with the reading suggesting a side way range bound market development testing support and resistant level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20101203 1033 Breaking News.


Thomas Mielke :
Malaysia Palm Oil Futures Price will fall in second half of 2011 on strong production and the incoming U.S soy crop
Palm Oil price will rise strongly in Jan ~ Apr 2010 by RM470 of current RM3525 level due to tight supply and high demand.

James Fry :
Palm Oil prices to fall to RM2,600 by Jun 2011

Dorab Mistry :

Malaysia Palm Oil Futures to Hit RM3,600 in Dec 2010 ~ Jan 2011.
Asian Crude Palm Oil Output to continue to underperform. Greatest period of tightness seen in Q1 2011.
Asian Palm Oil output to recover from Apr 2011 onwards but "Will not be strong or impressive".

20101203 1008 Local & Global Economics News.

Malaysia: October exports expected to drop
Malaysia’s export data for the month of October, which is expected to be released tomorrow, is likely to show an average decline of 0.9% y-o-y and also a slowdown from the month before, early estimates show. Forecasts of 14 economists compiled by Reuters revealed that the average exports for October would decline 0.9% compared with a 6.9% y-o-y growth in September. (Star Biz)

Thailand: Unexpectedly raises rate to tame inflation
Thailand unexpectedly raised interest rates for the third time this year, signaling policy makers view inflation as a bigger threat than slowing growth. The baht rose. The Bank of Thailand increased the one-day bond repurchase rate by a quarter of a percentage point to 2% after leaving the benchmark unchanged at the previous meeting, according to a statement in Bangkok. The decision was predicted by 5 of 17 economists surveyed by Bloomberg News. The rest expected no change. (Bloomberg)

Indonesia: Inflation quickens, adding pressure on interest rate
Indonesia’s inflation accelerated in November, putting pressure on policy makers to raise interest rates and contain price increases in the coming months. Consumer prices rose 6.33% last month from a year earlier, the Central Bureau of Statistics said in Jakarta. That compares with a 5.67% gain in October reported earlier. The median forecast in a Bloomberg News survey of 20 economists was for a 5.98% increase. Bank Indonesia has refrained from raising interest rates from a record low this year, delaying an increase that could attract more funds at a time when emerging markets are luring investors away from developed economies. (Bloomberg)

India: Growth may exceed forecast, ushering rate rise
India’s economy is likely to surpass the government’s 8.5% growth target for the fiscal year, forcing the central bank to resume interest-rate increases as domestic demand offsets risks from abroad. GDP climbed 8.9% for a second straight quarter in July to September, a government report showed, with the gains propelled by the manufacturing and services industries. Kaushik Basu, chief economic adviser to the finance ministry, said after the data release that India could achieve a 9% growth rate sooner than expected.. (Bloomberg)

Australia: GDP growth slower than forecast
Australia’s economy expanded at half the pace economists forecast in the third quarter as a stronger currency hurt exports. GDP advanced 0.2% from the second quarter, when it rose a revised 1.1%, the Bureau of Statistics said. That compares with the median forecast for a 0.4% gain in a Bloomberg News survey of 21 economists. The report reflects Reserve Bank of Australia (RBA) rate increases aimed at cooling inflation sparked by a mining industry expansion that governor Glenn Stevens said this week will extend “over a longish horizon”. (Star Biz)

EU: Sets tougher state aid rules for banks
Crisis-hit banks seeking state aid next year will have to overhaul their operations as part of a strategy to wean them off state support, the European Union’s competition chief said. The tougher conditions came as the European Commission extended by a year a framework of rules set up in Oct 2008 allowing EU governments to bail out their lenders under looser terms. (Star Biz)

Japan: Capex points to better 3Q GDP, outlook murky
Japanese firms raised capital spending in July-September for the first time in more than three years but profit and sales growth slowed, as a dip in demand both at home and abroad, spurred by a strong yen, clouds the economic outlook. The data, while pointing to an upward tweak when 3Q GDP figures are revised next week, will keep the Bank of Japan under pressure to maintain its very loose monetary policy, with slowing exports and the waning impact of government stimulus likely to trigger a fall in GDP in the current quarter. (Financial Daily)

Australia: Trade surplus swells
Australian retail sales suffered a shock 1.1% drop in October, the biggest decline in 15 months and a blow to hopes for a revival in economic growth this quarter that sent the local dollar skidding. On the other hand, the country’s trade surplus widened more than expected to AUD2.6bn (USD2.5bn), the seventh straight month of sizable surpluses and a big boost to incomes and investment. (Starbiz)

EU: Exports, investments hold back expansion
European export growth slowed and investment stagnated in the third quarter, countering a gain in consumer demand and curbing an economic expansion. Exports from the 16-member euro region rose 1.9% from the second quarter, when they increased 4.3%, the European Union’s statistics office in Luxembourg said. Investment stalled after rising 1.7% in the second quarter, while spending growth by consumers accelerated to 0.3% from 0.2%. GDP growth eased to 0.4% from 1%. (Bloomberg)

EU: Record low rates
The European Central Bank (ECB) has kept interest rates at a record low as investors look to president Jean- Claude Trichet for an announcement on how the bank will fight the worsening sovereign debt crisis. ECB officials in Frankfurt set the benchmark lending rate at 1% for a 20th month, as predicted by all 52 economists in a Bloomberg survey. (Starbiz)

EU: Spain, Ireland for privatization
The Spanish government is looking at auctioning stakes in its national lottery operator and airports, while Ireland will look at privatizations in its electricity and gas sectors as part of a joint European Union and International Monetary Fund (IMF) bailout package. News of privatization plans came as it emerged that the eurozone bailout fund will next month begin issuing debt on behalf of embattled member states. (Starbiz)

US: Home sales rise, job market improves
Pending sales of US existing houses unexpectedly jumped by a record 10% in October, indicating the industry at the center of the last recession is stabilizing as the job market improves. The increase in the number of Americans signing contracts to buy previously owned homes followed a 1.8% drop in September, the National Association of Realtors said in Washington. Another report showed claims for jobless benefits over the past month on average dropped to a two-year low. (Bloomberg)

US: Nov car sales show sector in recovery
After a year of watching car sales slowly increase month by month, industry executives are finally willing to firmly declare that the US market is in recovery. People who had been too afraid to make a big car purchase are finally coming back to dealerships, a little more confident that they won't lose their jobs. And that's reflected in November's car sales figures: Industry sales were up 16.9% for the month compared with a year ago. Ford, General Motors, Chrysler, Honda, Nissan and Hyundai all posted double-digit gains. (BT)

20101203 1006 Malaysia Corporate News.

 Dow posts best two-day gain since July
U.S. stocks capped their best two-day performance since July as better-than-expected retail and home sales painted a brighter picture of the U.S. economy. Also helping stocks, pressure on the euro eased on talk that the European Central Bank was actively buying more bonds of some of the bloc's more financially stressed governments. The Dow Jones Industrial Average finished Thursday up 106.63 points, or 0.95%, to 11362.41. The blue-chip index has gained 3.2% in the first two days of December, its largest two-day rise since July 8. (The Wall Street Journal)

PPB to issue 20% FFM Bhd new shares to Wilmar International
 PPB Group has proposed to issue RM378m worth of shares in FFM Bhd, its wholly-owned subsidiary, to PGEO Group SB, a wholly-owned subsidiary of Wilmar International Limited. It will issue 55.8m new FFM shares or 20% of FFM's total enlarged issue and paid-up share capital to PGEO. In turn, FFM has signed a MoU with Wilmar for a potential acquisition of 20% equity interest in selected subsidiaries of Wilmar in China via its whollyowned subsidiary, Waikari SB. (Bernama)

IJM, JAKS bag RM268.5m deal
IJM Corp and JAKS Resources’ 60:40 joint venture has secured a RM268.5m contract from the Ministry of Energy, Green Technology and Water for the Pahang-Selangor Raw water transfer project. The project involves the construction of 3m nominal diameter mild steel pipes with a total length about 24km and two access roads of 1.9km and 1.5km long (including 80m long bridge). (BT)

Sarawak government to meet PM to finalize Bakun acquisition
 The Sarawak government will meet Prime Minister Datuk Seri Najib Tun Razak soon to finalize the sale of the Bakun hydro-electric project, Chief Minister Tan Sri Abdul Taib Mahmud said on Thursday. Taib, who is also state Finance Minister, said the 2,400MW capacity-dam, is expected to generate 300MW of electricity by June next year, and has yet to be acquired by the state government. (Bernama)

 Proton, Perodua to meet on alliance by end-Dec
A meeting between Proton and Perodua will be held by the end of the month to finalize whether a strategic alliance between the two national carmakers can happen. Proton MD Datuk Syed Zainal Abidin Syed Mohamed Tahir said the meeting will also involve major shareholders of Proton and Perodua. (BT)

EPF’s RHB stake sale may raise up to RM766m
EPF will raise up to RM765.5m from a planned sale of a block of RHB Capital shares, which will see its shareholding in the bank drop below the 50% mark. A term sheet detailing the placement exercise obtained by Reuters showed that the indicative pricing of the placement had been set at between RM7.50 and RM7.90 per share. (Reuters)

TM to sell 191m Axiata shares
TM has proposed to sell some 191.5m shares of 2.27% it holds in Axiata Group to fund its capital expenditure, working capital, investment as well as debt repayment. The shares would be sold via a book building exercise over the next 2 weeks. (The Malaysian Reserve)

US stocks rise most in 3 months as economy improves
US stocks rallied, sending benchmark indexes toward their biggest gains in three months, amid improving economic data and speculation of a larger European financial rescue. The Standard & Poor’s 500 Index surged the most since 1 Sept on a closing basis, adding 2.2% to 1,206.41 at 2:50 p.m. in New York. The Dow Jones Industrial Average gained 259.2 points, or 2.4%, to 11,265.2 as all 30 stocks rose. The Dow average has rallied in December more than in any other month over the last century, according to data compiled by Bespoke Investment Group. On average, the 30-stock gauge has risen 1.3% in the month during the past 100 years, while gaining 1.5% and 1.7% over the last 50 and 20 years, respectively, the data show. (Bloomberg)

PGas to develop LNG re-gasification facilities in Melaka
Petronas Gas (PGas) has signed a heads of agreement with its parent company Petronas to develop liquefied natural gas (LNG) re-gasification facilities and supply LNG to the latter. In an announcement to Bursa Malaysia yesterday, PGas said the re-gasification facility would be located in the vicinity of Sungai Udang Port in Melaka encompasses two floating storage unit (FSU) to receive and store LNG, an island jetty and re-gasification units and subsea and onshore pipelines to pipe the gas to the Peninsular Gas Utilisation (PGU) pipeline network. (Financial Daily)

Dialog to buy 90% stake in NZ’s Fitzroy Engineering for RM31.7m
Dialog Group is acquiring a 90% stake in Fitzroy Engineering Group (FEGL), one of New Zealand’s largest heavy fabrication and multi-disciplined engineering companies, for RM31.7m (NZD13.5m) cash. The company said yesterday that its wholly-owned subsidiary, Dialog System (Asia) (DSAPL), had entered into a conditional sale and purchase agreement with Peter Clayton White-Robinson to acquire a 90% stake representing 2.38m shares. (Financial Daily)

Parkson unit sells stake in Hong Kong store
Hong Kong-listed Parkson Retail Group, a unit of Parkson Holdings, has disposed of a 55% stake in Yangzhou Parkson Plaza Co Ltd for 78.5m yuan (RM36.9m). Parkson Retail Group was expected to realise a pre-tax gain of about 40m yuan (RM19m) from the disposal, Parkson Holdings said in a statement to Bursa Malaysia yesterday. The rationale for the disposal is due to the location of the Yangzhou Parkson store which is no longer desirable for department store operation and the size of the store, which is too small to remain competitive in the market, it said. (StarBiz)

Perodua still not keen on merger despite study
Perusahaan Otomobil Kedua SB (Perodua) remains unconvinced a merger with rival Proton Holdings Bhd would be in its best interest after a study of a possible merger of both national car companies was completed. Managing director Datuk Aminar Rashid Salleh, who said Perodua had not been briefed on the findings of the study undertaken by Frost & Sullivan, reiterated the stance of the company it's not keen to pursue a merger. “If the proposal is better than any plan that we have, then we can have a look at it,'' he told StarBiz yesterday, adding that the company's shareholders too were not enthusiastic about the proposal as they had not seen the final picture. It was reported on Tuesday that a study undertaken to examine the possibility of a merger between Perodua and Proton had been completed and that the next step was to have the Economic Council review the findings before it was presented to the Prime Minister. (StarBiz)

Cahya Mata unit in RM380m JV to build hotel, apartments
Cahya Mata Sarawak, through 51%-owned subsidiary CMS Land SB, has signed a joint-venture agreement to build, own and manage a four-star hotel and service apartments at the Kuching Isthmus in Sarawak. It told Bursa Malaysia yesterday that it had signed the agreement with Premier Cottage SB (PCSB), Boulevard Jaya Corp SB (BJSB), Hikmat Majusama SB (HMSB) and Isthmus Developments SB (IDSB). The building, comprising 381 hotel rooms and 96 service apartments, will cost about RM380m, including outfitting, furniture, fittings and equipment, but excluding financing costs and contingencies. IDSB, which will undertake the development, will finance it via a combination of share issuance, borrowings from banks or financial institutions, as well as advances from the joint-venture partners, except CMS Land, totaling up to RM50mil. (StarBiz)

KNM forms joint venture in South Africa
KNM Group's wholly-owned subsidiary, KNM International SB, has entered into a shareholders agreement with Aveng (Africa) Ltd set up a joint-venture company in South Africa. In a filing with Bursa Malaysia yesterday, KNM Group said the joint-venture (JV) company, to be known as KNM Grinaker-LTA (Pty) Ltd, would undertake the fabrication of steel products. KNM International will own 49.9% of the JV company and Aveng will own the balance stake. (StarBiz

20101203 0950 Global Market News.

Oil trades near 25-month high before U.S. jobs report
SINGAPORE, Dec 3 (Reuters) - Oil was steady near 25-month  highs following a slew of upbeat U.S. economic data  that boded well for demand from the world's top user, ahead of  a jobs report expected to show employment expanded for a  second straight month in November.
"Oil, like most global markets, has been buffeted by concerns surrounding the euro zone problems and their potential broader implications," JP Morgan analysts headed by Lawrence Eagles said. 

U.S. wheat up 1 pct, extends rally on weather concerns
SINGAPORE, Dec 3 (Reuters) - U.S. wheat futures added more  than 1 percent, rising for the third straight  session and taking the weekly gains to 10 percent as rains in  Australia and dry weather in the United States continued raise  supply concerns and buoy prices.
"It has got do a lot with what is happening in Australia.  The rains have made crops unsuitable and there are more rains forecast," said Jonathan Barratt, managing director at
Commodity Broking Services in Sydney. "If corn can take out $5.50 level on December contract, it is going to go on  further. There is global tightness in supplies."

Gold ticks higher, but euro zone fears fade
SINGAPORE, Dec 3 (Reuters) - Gold gained to hold  near its strongest in almost three weeks as bargain hunting  helped the metal defy a rebound in the euro, waning Europe  debt concerns and upbeat U.S. data.
"We can say there are some bargain hunters at the lower end. There's not too much liquidity in the market and a little bit of buying moves up gold," said Ronald Leung, director of  Lee Cheong Gold Dealers in Hong Kong.    

US dollar, stocks poised to gain on jobs recovery
HONG KONG, Dec 3 (Reuters) - The U.S. dollar was steady ahead of payrolls data for November that could show  more evidence of a strengthening recovery and give investors a  reason to push benchmark U.S. Treasury yields above 3 percent  and put more money in equities.
"It is clear that the labour situation is improving and  with consumption demand -- the final demand that drives all  else -- strengthening by the day, hiring should continue to  improve," economists at DBS Group in Singapore said in a note.

Canola to miss boost from Canada biodiesel
WINNIPEG, Manitoba, Dec 2 (Reuters) - Canada's No. 2 crop, canola, looks to miss out on potential domestic demand from biodiesel until Canada clarifies its fuel mandate and offers new incentives to an already heavily subsidized industry.
Canada has finished selecting biodiesel plant proposals to receive funding from a C$1.5-billion ($1.5 billion) program, aiming to cut greenhouse gas emissions by 17 percent by 2020 from 2005 levels through mandates of 5 percent ethanol and 2 percent biodiesel in conventional fuel pools.

Oil-focused Asian hedge fund starts trading distillates
SINGAPORE, Dec 2 (Reuters) - RedWell Fund SPC, one of  Asia's pioneering oil-focused hedge funds, has its eyes  trained on the growing distillates market, as it started  trading in Singapore's Over-The-Counter (OTC) swaps market,  its founder said on Thursday. 
The fund, with $13 million under management, is committing  up to 70 percent of its portfolio to trading the regrade --  the price spread between jet fuel and gas oil -- and the rest  to  fixed-priced contracts of both products, said Wei Min, who  is also the fund's president. 

OIL: Crude trades near 25-month high before U.S. jobs report
SINGAPORE, Dec 3 (Reuters) - Oil was steady near 25-month  highs on Friday after a slew of upbeat U.S. economic data that  boded well for oil consumption by the world's top user, ahead  of a jobs report expected to show employment expanded for a  second straight month in November.
Both U.S. heating oil and gasoline futures rallied, supporting crude's rise. Heating oil rose amid colder temperatures in the U.S. Northeast, the biggest heating oil market. Gasoline gained on regional supply tightness in the key East Coast market. 
COMMODITY MARKETS: Metals, oil surge on upbeat data, Fri jobs eyed
NEW YORK, Dec 2 (Reuters) - Commodity markets soared on Thursday with oil and industrial metals helped by gains in the euro and encouraging U.S. economic data, while wheat rose on crop weather worries, but cocoa surged as contention over the presidency led to sealed borders in top grower Ivory Coast.
"The real issue is what happens next, and if we see violence," said Sterling Smith, a senior analyst for brokerage Country Hedging Minnesota.
GLOBAL MARKETS: Stocks, euro gain on talk of ECB bond purchases
NEW YORK, Dec 2 (Reuters) - The euro rebounded against the U.S. dollar on Thursday and global stocks rallied as talk that the European Central Bank had increased its buying of sovereign debt and recent upbeat economic data lifted sentiment.
"The fears had been centered on Europe. That seems to have stabilized," said Mark Bronzo, portfolio manager at Rydex-SGI in Irvington, New York. "Now the focus is on what domestic and international growth will look like. People are betting that growth will be better than people had feared."  

World recovery slows, will be hit by austerity-UN
UNITED NATIONS, Dec 1 (Reuters) - The world's recovery from the 2008 financial crisis is losing steam, with growth, hit by austerity drives in rich countries, not enough to restore the 30 million lost jobs in the next two years, the United Nations said on Wednesday.
"The road to recovery from the Great Recession is proving to be long, winding and rocky," said an annual U.N. survey, "World Economic Situation and Prospects 2011."

U.S. economy stays on sluggish growth path - Fed
WASHINGTON, Dec 1 (Reuters) - The U.S. economy continued its slow recovery in recent weeks, the Federal Reserve said on Wednesday, with pockets of strength in manufacturing offset by "depressed" housing markets and employers still reluctant to hire in significant numbers.
The U.S. central bank's Beige Book showed more anecdotal evidence that the economy is struggling to break into a faster expansion needed to generate sufficient job growth.

Markets pin hopes on ECB to ease Europe crisis
FRANKFURT/BERLIN, Dec 2 (Reuters) - The European Central Bank faced pressure on Thursday to take steps to contain the euro zone debt crisis and prevent it affecting the United States and Asia, but was unlikely to announce mass new bond purchases.
Pressure has grown on the ECB to act since last weekend's 85 billion-euro ($110.7-billion) EU-IMF rescue of Ireland failed to dispel fears that other countries using the euro, such as Portugal or Spain, could require a bailout.

PRECIOUS-Gold firms ahead of ECB meeting; debt fears linger
LONDON, Dec 2 (Reuters) - Gold firmed a touch on Thursday, supported by some safe-haven buying and a softer dollar, but prices remained rangebound as investors awaited the outcome of a key European Central Bank meeting later in the session.
"The ECB will determine currency moves and if we have a significantly stronger euro following the decision that's likely to be positive for gold," Daniel Major, analyst at RBS said.

FOREX-Euro holds firm as all eyes on possible ECB steps
LONDON, Dec 2 (Reuters) - The euro held firm on Thursday after rising the previous day as investors waited to see if the European Central Bank would take more steps to calm euro debt concerns, but could fall again if the central bank disappoints.
"The focus is on whether Trichet will announce a numerical target for bond purchases. If he keeps to saying they are ready to buy more bonds but without a numerical target, the markets will be disappointed and turn negative on the euro," said Roberto Mialich, currency strategist at Unicredit in Milan.

ECB hopes lift stocks, stabilises euro
LONDON, Dec 2 (Reuters) - World stocks rose for a second straight day on Thursday while the euro sat on the previous day's gains as expectations grew the European Central Bank might deliver measures to alleviate worries over euro zone debt.
"The focus is on whether (ECB President Jean-Claude) Trichet will announce a numerical target for bond purchases," said Roberto Mialich, currency strategist at Unicredit in Milan.

Oil slips from 3-week high on U.S. inventories, China policy
SINGAPORE, Dec 2 (Reuters) - Oil slipped as  traders focused on rising U.S. crude inventories following a  rally of 3 percent in the previous session, when encouraging  jobs data in top consumer the United States helped drive  prices to their highest in almost three weeks.
"Yesterday's rally was due to general risk on sentiment  and positive economic data from China and the United States,"  said Stefan Graber, a commodities analyst with Credit Suisse  in Singapore.

Gold firms near highs, euro debt worries persist
SINGAPORE, Dec 2 (Reuters) - Gold firmed,  within sight of its highest in nearly three weeks hit the  previous session, as worries about euro zone's fiscal crisis  lingered despite hopes the European Central Bank and the  United States would step in to help.
"I don't think you can solve this problem a short period  of time. I think we are still worried about the situation in  Europe," said Dick Poon, manager at Heraeus in Hong Kong. 

Stocks rally, euro steadies ahead of ECB meeting
HONG KONG, Dec 2 (Reuters) - Japan's Nikkei share average  hit a five-month high and the euro stayed within sight of  overnight highs ahead of a European Central Bank  meeting that investors speculate could yield new measures to  contain the euro zone's fiscal crisis.
"The sovereign debt crisis has shown early signs of  transforming into a banking and liquidity crisis," Todd Elmer,  currency strategist with Citi in Singapore, said in a note.

COMMODITY MARKETS: Raw goods rally on Chinese, US economic data
NEW YORK, Dec 1 (Reuters) - Commodities rallied on Wednesday, led by sharp gains in U.S. wheat and gasoline futures, after positive economic data from the United States and China, the world's leading consumers, and a stronger euro boosted investor confidence about demand.
"From the depths of despair yesterday that resulted in a sell-off, there is a rash of positive economic data everywhere you look today," said Phil Flynn, energy analyst at PFGBest in Chicago.
GLOBAL MARKETS: Stocks, euro leap on hope US, ECB may help Europe
NEW YORK , Dec 1 (Reuters) - World stocks and the euro jumped on Wednesday on hopes the United States would further support debt-burdened euro-zone countries and bets the European Central Bank could step up its bond-buying program.
"It seems that as bad as Europe's issues are, there is a growing sense that this is not a systemic problem that is going to bring the whole system down," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago.

20101203 0942 Soy Oil & Palm Oil Related News.

China's palm oil demand growth may slow in 2010-2011 -COFCO
NUSA DUA, Indonesia Dec 3 (Reuters) - Growth in China's  palm oil demand could slow 1.7 percent to 5.9 million tonnes  in the marketing year that began in Oct 2010 as the country  was on a soybean buying spree and the domestic crop   improves, a researcher with COFCO said.
But any damage to crops, especially in South America,  where drier weather induced by La Nina has slowed soy  plantings and could affect yields, may boost palm oil imports,  said Jennifer Yuan, a researcher with China's state-owned  trading house. 

Indonesian palm tax at comfortable levels-SMART
NUSA DUA, Indonesia Dec 3 (Reuters) - Indonesia's export  tax on palm oil products are at comfortable levels but any  steps by the government to change the structure needs to  equally benefit planters and refiners, a top plantation firm  said late on Thursday.
Palm oil giant SMART TBK  said the government's  plan to review the export taxes, currently at their highest  this year at 15 percent in December, needs to consider small  farmers who do not have similar economies of scale as big  planters. 

Palm oil may gain more users from EU biofuel rules-Neste Oil
NUSA DUA, Indonesia Dec 2 (Reuters) - European Union rules  requiring vegetable-oil based biofuels to come from  eco-friendly sources may boost palm oil use in the sector as  green supplies of the tropical oil grow, a key Finnish oil  refiner said on Thursday.
A Neste Oil  official said green groups scrutiny  of the Asian palm oil sector has spurred efforts to clean up  estates and supply chains, placing it in a better position  than other competing oils to meet EU sustainability criteria. 

U.S. soy product futures close mixed, as soymeal weakened with soybeans in setback from strong gains. Market participants took profits on previous positions in soybeans and soymeal after broad commodity rally Wednesday, analysts say. Weaker-than-expected soymeal demand added pressure, as weekly U.S. sales of 133,800 tons were below trade estimates, they say. Weekly U.S. soyoil sales of 32,100 tons beat trade estimates. CBOT January soymeal dropped $2.80 to $345.70 per short ton, and CBOT January soyoil rose 0.23 cent to 52.84 cents per pound.(Source: CME)

China Takes Action To Cap Cooking Oil Prices –Source (Source: CME)
China has put policies into place to restrain food producers from raising cooking oil prices as part of efforts to address sharply higher prices and ensure supply to the public, an industry official familiar with the situation said. The move represents the reintroduction of price caps on basic necessities, albeit applied in a single commodity market--a far narrower version of a controversial yearlong policy that went into effect in January 2008. The policy action hasn't so far placed producers at a price disadvantage, and the measures may not last beyond the Lunar New Year in early February, the person, who is linked to a major global agribusiness. "There is still a margin to be made," he said, adding that margins for producers are generally between $20 and $50 a metric ton. "The aim is not to disadvantage suppliers."
Officials from the National Development and Reform Commission, China's top economic planning agency, met executives from major food producers Cofco Ltd., Jiusan Grain and Oil Group, the Yihai Kerry Group--owned by Singapore-based Wilmar International Ltd. --and Chinatex Corp. last week to ask the companies not to raise prices for cooking oil in small-package form, the 21st Century Business Herald reported Thursday. The companies would have to apply to the commission if they wanted to raise prices during this period, it said. "There are a couple of things in play. Obviously, there is policy action to control prices and use moral suasion, and the government is also holding auctions to address supply," the person said. According to some reports, the measures could last four months, but the person said they could be briefer.
"Beyond Chinese New Year, why would you want to control prices?" he said. The price cap on cooking oil extends a government policy adopted last month to increase government control of the market. The central government at the time appointed Cofco, Yihai Kerry and Chinatex as pre-approved bidders at state edible oil auctions, and said provincial grain authorities could recommend two to five more bidders of their choice. The move, aimed at neutralizing speculators, gave a competitive advantage to the larger players. Purchases at such auctions wouldn't be permitted to be resold, the State Administration of Grain said at the time.

India 2010-11 Edible Oil Imports Likely Flat At 8.8 Mln Tons (Source: CME)
India's edible oil imports this marketing year are likely to remain unchanged from last year as domestic output will rise enough to meet higher consumption, a senior industry executive said. India imported 8.8 million tons of edible oil in the year ended Oct. 31. The country is the world's largest edible oil importer and meets more than half of its requirements through imports. "The summer-sown oilseeds crop projection is higher. So the 3%-4% increase in [edible oil] demand could be made up by higher domestic oilseeds production," Sushil Goenka, president of the Solvent Extractors' Association of India, said. According to the Central Organization of Oil Industry and Trade, India's summer-sown oilseeds output in the marketing year that started Oct. 1 is likely to jump 12.4% to 15.4 million tons from 13.7 million tons last year. In 2009-10, the country's imports climbed to a record as international prices were low and the local crop shrank after the worst drought in nearly four decades.
India imports palm oil mainly from Indonesia and Malaysia, and soyoil mostly from Brazil and Argentina. "Sunflower oil imports may be lower [in 2010-11] due to higher prices and increasing price difference between soyoil and sunflower oil," Goenka said. Sunflower usually commands a premium over soyoil, but now the difference has widened to $250-$300 a ton from about $50-$100/ton a year earlier. India imported 630,005 tons of sunflower in 2009-10, while soyoil imports stood at 1.7 million tons. Goenka added that soyoil imports this marketing year will depend on the price difference with palm oil. The premium of soyoil over palm oil is currently $60-$80/ton. The Solvent Extractors' Association of India is also seeking the imposition of a 10% import tax on crude edible oil to protect local farmers, Goenka said. India doesn't impose any import tax on crude edible oils, but levies a 7.5% tax on refined edible oils.

Wheat dips from 3-wk top; corn, soy ease on profit-taking
SINGAPORE, Dec 2 (Reuters) - U.S. wheat fell around half a  percent on Thursday as the market took a breather after  climbing more than 7 percent in the previous session, the  biggest rise in around 2 months, amid crop concerns and a  broad based commodities rally.
"The slight weakness in Chicago market is perhaps just a  pause after the steep rise that we saw yesterday," said Luke  Mathews, a commodity strategist at Commonwealth Bank of  Australia.

Palm at new 28-mth highs on global commods, weather
KUALA LUMPUR, Dec 2 (Reuters) - Malaysian palm oil futures  hit a fresh 28-month high on Thursday, tracking firmer global  commodity markets and concerns over low production during the  monsoon season.
"Palm oil is up mainly on overseas factors, especially the stronger grain and soy complex," said a trader

Heavy rain headed for Brazil's No. 2 soy state
SAO PAULO, Dec 1 (Reuters) - Most of Brazil's southern soybean states will get heavy rainfall over the weekend, which will favor development of the newly planted crops there, Somar forecast Wednesday.
No. 2 soy producing state Parana is expected to get 89 millimeters (3.5 inches) over the next five days. It has seen the best rainfall of the major soybean states since planting started in mid-September.

Palm oil may gain more users from EU biofuel rules-Neste Oil
NUSA DUA, Indonesia Dec 2 (Reuters) - European Union rules  requiring vegetable-oil based biofuels to come from  eco-friendly sources may boost palm oil use in the sector as  green supplies of the tropical oil grow, a key Finnish oil  refiner said on Thursday.
A Neste Oil official said green groups scrutiny  of the Asian palm oil sector has spurred efforts to clean up  estates and supply chains, placing it in a better position  than other competing oils to meet EU sustainability criteria.

Argentine law reform could double soy seed sales
CHACABUCO, Argentina, Dec 1 (Reuters) - A new law being studied by Argentina's government could double sales of soy seeds, guaranteeing companies royalty payments and encouraging them to introduce new varieties, a leading supplier said on Wednesday.
The introduction of genetically modified (GMO) soy has helped Argentine farmers boost output dramatically over the last 14 years, but current regulations have deterred seed companies from marketing strains using the latest technology.