Corn (Source: CME)
US corn futures finish firmer as persistent planting delays raise concerns that farmers won't plant as many acres as intended. Rains in Ohio and the Dakotas are keeping progress slow after weeks of delays due to cool, wet weather. Fertilizer producer CF says it looks increasingly likely plantings will fall below 92M acres; the USDA in March predicted farmers would plant 92.2M. CBOT July corn jumps 9c to $7.42 1/4 a bushel.
Wheat (Source: CME)
US wheat futures close higher, with MGEX leading the rally on concerns about wet weather preventing planting. Rains continue to keep farmers out of fields in North Dakota, the top producer of spring wheat traded at the Minneapolis Grain Exchange. "There are some really serious planting delays that are going to continue," says Mike Krueger, president of The Money Farm. Poor global weather adds support as Western Europe is dry too. CBOT July wheat rises 16 3/4c to $7.96 1/2 a bushel, KCBT July gains 16 3/4c to $9.28 3/4 and MGEX July soars 31 1/4c to $10.20.
Rice (Source: CME)
US rice futures advance with prices for other grains. A sharp rally in wheat helped lift rice, as both grains are global food staples, an analyst says. Traders continue to worry floods affected crop land near the Mississippi River, including thousands of acres of rice, as rice plantings were already down significantly from last year. CBOT July rice rises 4 1/2c to $15.17 1/2 per hundredweight.
Commodities fundamentals strong despite recent rout-Glencore
HONG KONG, May 25 (Reuters) - The recent slump in commodity prices has taken the speculative froth out of the market, but fundamentals are still strong given tight supplies and buoyant demand from emerging markets, Glencore International said on Wednesday.
Asian demand should underpin growth in commodities as global producers keep pace with the booming appetite from economies in the region, Glencore said.
Traders: End To Russia Grain Ban Imminent; Export Controls Expected (Source: CME)
Russian grain traders are increasingly hopeful the government will lift its ban on grain exports in July, industry sources said, although opinions differ on how the shipments will be managed. Speculation that the Kremlin will allow grain to leave the country has been mounting as prospects have improved for the country's harvest as a period of warm dry weather has helped farmers catch up on their spring sowings. Moscow-based analysts SovEcon this week raised its estimate for Russia's grain harvest to 85 million metric tons from previous expectations of 78-83 million tons. It pegged exports for the 2011-12 crop year at 15 million tons, towards the top end of industry estimates. Managing director Andrey Sizov Jr. said "it's too early to say whether Russia will resume exports by July 1, but it is indeed looking increasingly likely."
The promise of a better crop comes as officials are due to discuss whether to lift the embargo on grain exports imposed last August after devastating drought cut the harvest by around a third to an estimated 61 million tons. Any exports could potentially take the pressure off international markets, which have rallied almost 30% from March lows due to concerns the 2011-12 crop will not be large enough to meet world demand. Dealers and lobby groups have been pushing for the ban to be dropped when it expires at the end of June and some say they expect a decision from the government as early as this week. Key for the government is the need to balance curbing domestic food-price inflation--the public's top gripe in polls ahead of next year's election--and ensuring prices are high enough to encourage good plantings next season.
Domestic grain prices have begun to stabilize after a recent slump as traders have begun to buy in readiness for exports, but are still trading at a discount of $100-150 a ton compared to international markets. "The crops look better in Russia, but the world prices are strong," said a senior trader with operations in Russia. "The government will have to choose between allowing free exports and managing inflation targets." Traders said they expect any exports to be carefully managed. Some said the government may follow the example of neighboring Ukraine by imposing an export tax. Others said the government may allow free exports until September and then reconsider when the next harvest is finished. "The idea seems to be to let the ban run out and to allow exports for three months until end of September without quotas," said the first trader. "Then the overall supply situation would be reconsidered depending on the final crop outcome."
Either way, market commentators still see Russia's exports as a major supply risk for the 2011-12 crop year. All major forecasting agencies have predicted an expansion in world plantings this year but severe dryness in Europe and parts of the U.S. have caused concerns that production will be stunted again next year. Macquarie analyst Kona Haque said if producers manage the 20-30% expansion in wheat production she forecasts, it looks likely the Kremlin will lift the embargo in 2011 but the "fact that there is an export ban still in place is a huge supply-side risk right now."
India Won't Allow Wheat, Rice Exports From Govt Stocks-Minister (Source: CME)
India will not allow any wheat or rice exports from government stocks, despite ample supplies as the country is gearing up to soon introduce a food security law that guarantees cheap grains to 70% of the population, food minister said. "Our draft (food security) bill is ready. We should have enough stocks. Any decision on exports will need to be taken on that basis," K.V. Thomas said. However, the minister added that he was open to allowing limited exports to private trade. Exports from India, the world's second-largest wheat and rice producer, would help to ease tight global supplies, but the minister said the government would tread cautiously and a decision is unlikely for at least a month. India has maintained a ban on the export of wheat and common grades of rice for the past three years, but overflowing stocks have nudged the government to examine whether to allow some exports. The minister said a panel is expected to discuss the draft (food security) law at its next meeting, without specifying a date.
Once the approval comes through, the government will place it in parliament after a cabinet clearance. India is expecting a record foodgrain output of 235.9 million tons in 2010-11, while its stocks are more than double the requirement for government's welfare programs. The annual foodgrain requirement for welfare programs will jump to around 82 million tons from 61 million tons once the new law is implemented. "It is like a war. Foodgrain production will have to go up and so will procurement and supply, once the new law is in place," the minister said. The government was also exploring the possibility of overseas cultivation of food crops particularly in Africa to meet higher demand in coming years, adding that he recently held talks on possible collaboration with Uganda.
Separately, Thomas also said that he was examining together with the farm ministry whether to impose a tax on imports of crude edible oil and raise the 7.5% duty level on refined oils to encourage domestic cultivation that has jumped in 2010-11. The edible oil industry has demanded a 10% import tax on crude edible oil and a 17.5% import tax on refined oils to offset the impact of local taxes on domestic producers. India's oilseeds output this crop year through June is estimated to jump to 30.25 million tons from 24.88 million tons last year. Thomas also ruled out the possibility of allowing more sugar exports under the open general license this marketing year through September beyond the 500,000 tons that has been allowed. "Why should we think of more exports now when only half the quantity permitted has been shipped so far," he said. Indian mills are struggling to export as global prices have fallen from record levels three months ago and fresh supplies from Brazil are expected to bring down prices further.
U.S. wheat up 1 pct, corn firm after selloff
NEW DELHI, May 25 (Reuters) - Chicago wheat rose around 1 percent on Wednesday as poor crop weather across top producing regions of the world supported the market, while corn firmed on forecasts of more rains in the U.S. crop belt.
"The weather conditions are difficult. Please remember that the corn belt is very wet," said Garry Booth, a trader with MF Global Australia.
Farmers gain, forests at risk from Brazil land bill
BRASILIA, May 24 (Reuters) - Lawmakers passed an overhaul of Brazil's forest code on Tuesday that relieves farmers of part of $304 billion in potential costs in one of the world's breadbaskets but that environmentalists say will cause deforestation to surge.
The new law governing land use would reduce the amount of forest that farmers must preserve, relax the conservation of hilltops, and give partial amnesties for massive fines for past deforestation in Latin America's largest country.
Argentina allows 200,000 tonnes more in wheat sales
BUENOS AIRES, May 24 (Reuters) - Argentina authorized the exportation of an additional 200,000 tonnes of 2010/11 wheat, a limited amount because some farmers have not declared the full size of their crops, an official said on Tuesday.
Argentina is a major wheat exporter but the government restricts international shipments to ensure domestic supply as it grapples with inflation, estimated by private economists at 25 percent per year. Corn shipments are also controlled.
Rains urgently needed for much West European wheat
LONDON, May 24 (Reuters) - Wheat crops in much of western Europe remain in urgent need of more rain with time beginning to run out for some, particularly those on lighter soils, analysts and industry sources said on Tuesday.
"With every day that passes, the potential for recovery is dwindling," Jack Watts, senior economist with the Home-Grown Cereals Authority, said referring to the UK crop.
More severe storms, big rains head to US Corn Belt
CHICAGO, May 24 (Reuters) - More severe storms head to the U.S. Midwest this week, bringing heavy rains to soaked lands in the eastern belt where farmers are already struggling to finish corn planting by month's end, a forecaster said on Tuesday.
"With the rains coming, they are not going to see a whole lot of progress this week. It dries out later -- but by then it will be early June," said Joel Burgio, Telvent DTN forecaster.
Russia govt urged to lift grain ban July-Sept
MOSCOW, May 24 (Reuters) - Russia's government is considering a proposal from leading Russian grain traders and industry analysts to lift its ban on grain exports from July to the end of September, a top Russian analyst said on Tuesday.
"We have made this proposal, but officials may have other opinions," SovEcon President and CEO Andrei Sizov told Reuters.
Iraq sees higher wheat harvest, to suspend imports
BAGHDAD, May 24 (Reuters) - Iraq expects its wheat harvest to increase to between 2 million and 2.5 million tonnes this year, the agriculture minister said on Tuesday, up from 1.866 million tonnes in the 2009/2010 season when rains were good.
"We expect wheat to be above two million tonnes," Izzedine al-Dawla told reporters.
S.Africa raises 2010/11 maize output f'cast
JOHANNESBURG, May 24 (Reuters) - South Africa raised its May 2010-April 2011 maize output forecast on Tuesday, beating market expectations, after an increase in white maize yields in some parts of the country.
The government Crop Estimates Committee (CEC) said the country is now expected to harvest 10.99 million tonnes of maize, compared with 10.883 million tonnes in its previous forecast.
ICE sugar edges up but remains rangebound
LONDON, May 25 (Reuters) - ICE sugar rose in early trade on Wednesday, boosted by port congestion in top producer Brazil, while coffee also edged up but cocoa registered marginal losses.
ICE raw sugar edged higher in early trade but remain well within its recent trading range.
Brazil coffee farm will irrigate to boost output
BRASILIA, May 24 (Reuters) - Brazil's biggest coffee farm, Ipanema Coffees, hopes to boost yields by as much as a third through use of irrigation, part of an investment trend among producers eager to cash in on a sharp rise in prices.
Washington Rodrigues, CEO at Ipanema Coffees in the southeastern coffee belt in Minas Gerais state, said factors such as land prices in the dense farming region and surging labor costs made yields the most viable way to raise output.
Honduras 11/12 coffee output seen at 3.9 mln bags-attache
WASHINGTON, May 24 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in Honduras:
"Honduras ranks first in Central America, third in Latin America, and seventh globally in coffee exports by volume. Honduran coffee production in 2011/2012 is forecast at 3.9 million 60 kilograms (kg) bags.
Government to finance Brazil cane replanting-paper
SAO PAULO, May 24 (Reuters) - The Brazilian government plans to offer a line of subsidized credit to sugar and ethanol mills for the replanting of cane crops, as part of a larger push to stimulate production of the biofuel, agriculture minister Wagner Rossi told a local newspaper.
Rossi said in Tuesday's Valor Economico paper that the new line of credit would be in the annual farm budget and directed at improving sugar cane yields through replanting of less productive fields.
Alien weed hits cotton, wheat in Syria, Iraq -FAO
MILAN, May 24 (Reuters) - An invasive alien weed, silverleaf nightshade, is theatening cotton and wheat crops in Syria and Iraq and could spread to Lebanon and Jordan, the United Nations Food and Agriculture Organisation (FAO) said on Tuesday.
More than 60 percent of the farmland in Syria, growing mainly cotton and wheat, has been infested with the weed, originally from the American tropics, which sucks nutrients from the soil and starves crops of water, the FAO said in a statement.
Ivorian cocoa arrivals 13 pct up from last season
ABIDJAN, May 24 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast were 13 percent higher than last season, data from the official marketing body obtained by Reuters on Tuesday showed, despite massive smuggling to Ghana.
Arrivals reached 1,068,918 tonnes by May 15, up from 946,644 tonnes in the same period a year ago, the data from the Coffee and Cocoa Bourse (BCC) showed.
Oil Trades Near a Two-Week High as U.S. Distillate Fuel Supplies Decline(Source: Bloomberg)
Oil traded near a two-week high in New York on signs of increased U.S. demand after a government report showed inventories of diesel and heating oil fell in the world’s biggest crude-consuming nation. Futures were little changed after climbing 1.7 percent yesterday as the Energy Department said distillate stockpiles declined 2.04 million barrels to 141.1 million last week, the lowest since April 2009. Demand for the fuel advanced 10 percent to 3.98 million barrels a day, the report showed. Gasoline stockpiles rose 3.79 million barrels to 209.7 million, the biggest addition since February.
China plans to increase scrap metals output by 60 pct by 2015-Assn
SINGAPORE, May 24 (Reuters) - China plans to expand output of secondary nonferrous metals by 60 percent from 2010 to 1.2 million tonnes by 2015 by tapping into scrap, a senior official at the China Nonferrous Metals Industry Association Recycling Metal Branch said on Tuesday.
China plans six to eight new scrap copper plants each with an annual capacity of 200,000 tonnes, eight to 10 scrap aluminium plants with 200,000 tonnes of capacity and 10 lead recycling projects with 50,000 tonnes of capacity, said Hongchang Ma, deputy secretary general of the association.
Japan April aluminium shipments down 7.6 pct yr/yr
TOKYO, May 25 (Reuters) - Japanese shipments of aluminium products fell 7.6 percent in April from a year earlier to 163,805 tonnes, industry data showed on Wednesday, reflecting weak demand as production was hit by the March 11 earthquake and tsunami.
Shipments were down 4.1 percent from 170,878 tonnes in March and it was the second month in a row of year-on-year declines, data provided by the Japan Aluminium Association showed.
Japan April rolled copper output rises mth/mth
TOKYO, May 25 (Reuters) - Japan's output of rolled copper product rose 3.1 percent in April from March, with manufacturers ramping up production ahead of power shortages slated for the summer, an industry body said on Wednesday.
The Japan Copper and Brass Association said rolled copper output totalled 70,669 tonnes on a seasonally adjusted basis in April, nearly flat from a year earlier.
Japan April rolled copper output rises mth/mth
TOKYO, May 25 (Reuters) - Japan's output of rolled copper product rose 3.1 percent in April from March, with manufacturers ramping up production ahead of power shortages slated for the summer, an industry body said on Wednesday.
The Japan Copper and Brass Association said rolled copper output totalled 70,669 tonnes on a seasonally adjusted basis in April, nearly flat from a year earlier.
METALS-Copper rallies as tight supply view back in focus
LONDON, May 25 (Reuters) - Copper rallied on Wednesday as a fall in production at the world's top copper mine put its longer-term supply fundamentals squarely back in focus and as worries over sovereign debt in the euro zone eased. Three-month copper on the London Metal Exchange traded at $9,005 per tonne at 0957 GMT, versus a close of $8,860 a tonne on Tuesday.
The metal used in power and construction fell to a five-month trough of $8,504.50 on May 12 and has since struggled to regain momentum.
PRECIOUS-Gold hits 3-wk high on euro zone debt jitters
LONDON, May 25 (Reuters) - Gold hit a three-week high on Wednesday, boosted by fears about the debt crisis in euro zone countries such as Greece while the resulting stronger dollar against the euro undermined sentiment. Spot gold hit $1,528.40 a troy ounce, its highest since May 4. It was bid at $1,526.79 an ounce at 1120 GMT from $1,525.75 an ounce late in New York on Tuesday.
Euro-priced gold hit a record 1,087.84 euros an ounce, according to Reuters data. Gold priced in sterling was at 942.60 pounds per ounce, near a lifetime high of 944.87 struck on Tuesday.
Gold Rises on Concern Over Europe Debt(Source: Bloomberg)
Gold rose for a fourth straight session, the longest rally in three weeks, as Europe’s debt crisis increased investor demand for the precious metal as a protection of wealth. Christian Noyer, a member of the European Central Bank’s governing council, yesterday ruled out a restructuring of Greece’s debt, calling it a “horror story” that would leave the nation shut out of financing for years. Gold priced in euros and British pounds climbed to records today as policy makers disagreed over how to solve Greece’s fiscal woes.
