Thursday, October 6, 2011

20111006 1009 Global Commodities Related News.

Commodities Climb From 10-Month Low as Bernanke Vows Steps to Boost Growth (Bloomberg)
Commodities rebounded from the lowest in 10 months after Federal Reserve Chairman Ben S. Bernanke said that the central bank may take further steps to sustain an economic recovery. The Standard & Poor’s GSCI index of raw materials rose 2.8 percent to settle at 592.03 at 3:48 p.m. New York time, the biggest gain since Sept. 27. Energy and agricultural prices led the rally. Crude oil had the biggest increase since May, while wheat advanced the most in two months. Yesterday, the commodity gauge touched 572.92, the lowest since Nov. 26. Bernanke affirmed a plan to keep interest rates low at least through mid-2013. The Fed may reduce the rate paid on banks’ reserve deposits or buy more securities, he said. Today, U.S. data on payrolls and service industries topped forecasts by analysts. The MSCI All-Country Index of equities gained as much as 2.1 percent.

Corn (CME)
US corn futures rallied, bouncing on strength in external financial markets and supportive demand outlooks. Concerns about the global economy take a back seat, and that opened the door for a corrective bounce in commodities, with optimistic outlooks for increased export demand helping fuel higher price sentiment, analysts say. Nevertheless, traders say advances were more reflective of oversold technical conditions, overdue for a bounce with bargain hunting by processors and ethanol plants aiding the recovery, analysts add. CBOT Dec corn settled up 17 3/4c at $6.05 1/2/bushel.

Wheat (CME)
US wheat futures end higher on spillover strength from corn and uncertainty about US crops. Corn rallied amid short-covering and a private group's crop projection, adding wheat in the process. Forecasts for rain in the parched southern Plains is negative for prices, but North America Risk Management Services analyst Jerry Gidel says it's an open question as to whether the rains would be enough to help farmers struggling to plant winter wheat. "At this point, keep an eye on the Amarillo rain gauge," he says. December CBOT wheat jumps 21 1/4c to $6.25 1/4 a bushel, December KCBT climbs 13 1/4c to $6.99 3/4 and December MGEX gains 13 3/4c to $8.76 1/2.

Rice (CME)
US rice futures end mostly higher on outside support and weather problems that threaten global supplies. Market pulled higher by rally in other grains, as traders covered short positions following a recent swoon. Price Futures Group Vice President Jack Scoville adds the market has some supportive fundamentals, including typhoon damage in the Philippines, flooding in Vietnam and "sky high" prices in China. CBOT Nov rice ends up 17c, or 1.1%, to $16.01 1/2 per hundredweight.

GRAINS-Corn, wheat rise on economic hopes, Chinese demand
SINGAPORE, Oct 5 (Reuters) - U.S. corn rose more than 1 percent, while soybeans recovered from a near one-year low as the markets took a breather on hopes that European leaders were stepping up efforts to contain the region's debt woes.
"Once the financial markets settle, the commodity markets will also settle, but I think over the next few months it's going to be very volatile," said Abah Ofon, an analyst with Standard Chartered Bank in Singapore.

ADM to expand Brazil soybean crushing plant
SAO PAULO, Oct 4 (Reuters) - U.S.-based multinational Archer Daniels Midland Co  is expanding soybean crushing capacity by 50 percent at its plant in Santa Catarina state in southern Brazil, an ADM director said.
The expansion is part of ADM's plans to operate a biodiesel plant adjacent to its existing crusher in the state. The biodiesel unit is expected to begin operation in 2012.

Duties to limit Ukrainian grain exports - AgMin
KIEV, Oct 5 (Reuters) - Ukrainian grain exports may stall in the current marketing season at the previous season's level if export duties on grains remain in place, Agriculture Minister Mykola Prysyazhnyuk told Reuters on Wednesday.
"We need to export 25 million tonnes but if export duties remain in place, we will export about 13 million tonnes, maybe a little bit more," he said.

Vietnam ups 2011 rice export forecast to 7.5 mln T
HANOI, Oct 5 (Reuters) - Vietnam's rice exports this year could reach a record of 7.5 million tonnes, the Agriculture Ministry said, revising its previous projection of 7.3 million tonnes.
The new export volume would generate $3.72 billion in revenue, also up from an earlier projection of $3.55 billion, the ministry said in a report seen by Reuters on Wednesday.

Manila sees no need to buy rice, to reassess typhoon damage
MANILA, Oct 5 (Reuters) - The Philippines has ample rice stocks to cover damages from two strong typhoons that hit last week and has no urgent need for imports, a senior official said, as the agriculture department reviews whether damage estimates may have been inflated.
The typhoons damaged about 760,000 tonnes of unmilled rice yet to be harvested, mostly from the central Luzon region, equal to two weeks of national consumption and more than 11 percent of the expected rice harvest in the fourth quarter, Agriculture Undersecretary Antonio Fleta said.

China corn imports may far exceed USDA forecast
CHICAGO, Oct 4 (Reuters) - China may need to import five times as much corn as the U.S. government expects over the next year, an industry group said on Tuesday, setting the stage for another potentially explosive year for prices.
The U.S. Grains Council, which just completed a crop tour in China, said the record harvest won't be enough to meet demand in the world's most populous nation, where expanding consumption of meat is undermining decades of self-sufficiency and helped fuel the record surge in prices earlier this year.

Canada canola, wheat crop grows less than expected
Oct 4 (Reuters)- Canadian farmers expect to produce more canola and wheat in 2011 than last year due to favorable late-season conditions, according to a Statistics Canada survey of farmers released on Tuesday.
Canola production is estimated to reach 12.9 million tonnes, 1.2 percent above 2010 levels but below the 13.8 million tonnes estimated by grain traders and analysts in a Reuters survey. All-wheat production is seen hitting 24.2 million tonnes, up 4.3 percent  from 2010 levels but below the average market estimate.

Russia harvests 89.5 mln T grain by Oct 4 - AgMin
MOSCOW, Oct 4 (Reuters) - Russia harvested 89.5 million tonnes of grain by bunker weight by Oct. 4 from 38.9 million hectares, or 88 percent of the sown area, the Agriculture Ministry said on Tuesday.
The ministry did not provide a comparison to a year-ago volume, but last year, when the country was hit by a severe drought, it said farmers harvested 60.96 million tonnes of grain from 37.96 million hectares by Oct. 5, 2010.

India has no plans to change palm tax, rice ready -ministers
JAKARTA, Oct 4 (Reuters) - India has no plans to change its import duties for palm oil and products, and has sufficient rice supplies to export to Indonesia without need for a government-to-government scheme, trade ministers from both countries said on Tuesday.
India's Trade Minister, Anand Sharma, is in Jakarta for trade talks with his Indonesian counterpart, Mari Pangestu.

Ukraine grain harvest at 40.76 mln T as of Oct 3
KIEV, Oct 4 (Reuters) - Ukraine's farms have harvested 40.76 million tonnes of grain from 82 percent of the sowing area as of October 3 against 35.6 million tonnes at the same date in 2010, the Agriculture Ministry said on Tuesday.
The ministry said in a report the grain yield averaged 3.21 tonne per hectare this year compared to 2.65 tonne in 2010 when weather extremes curtailed harvests.

Corn in Chicago Climbs 0.3% to $6.0725 a Bushel; Wheat, Soybeans Advance (Bloomberg)
Corn for December delivery rose 0.3 percent to $6.0725 a bushel on the Chicago Board of Trade at 10:24 a.m. in Melbourne. Soybeans for November delivery gained 0.3 percent to $11.6675 a bushel. December-delivery wheat advanced 0.2 percent to $6.2625 a bushel

Morocco Suspends Soft Wheat, Durum Import Duty (CME)
The Moroccan government has announced the suspension of import duties for soft wheat as well as durum, according to a notice on the country's ministry of economy and finance website. According to the announcement, all duties will be suspended on soft wheat imports between Nov. 15 and Dec. 31. For durum imports, all duties will also be suspended from Oct. 1 until Dec. 31. The ministry attributed the suspension in soft wheat import duties to volatile price levels internationally which are linked to fears of a slowdown in demand due to the global financial crisis. Also, quality problems of domestically harvested wheat meant a suspension in duties would allow enough supplies for the entire North African country. At present, the country stipulates import tariffs of 135% and 80% for soft wheat and durum respectively.

India May Consider Hike In Minimum Buy Price For Wheat In 10-15 Days - Farm Minister (CME)
India's federal cabinet will likely consider a higher minimum purchase price for wheat for this year within a fortnight, Farm Minister Sharad Pawar said. The government raised the procurement price of wheat by INR200 per metric ton to INR11,200 per ton during last year. However, Pawar didn't specify the amount of hike for this year and said that decision will be taken by cabinet. Wheat -- India's main winter season crop -- is usually sown in November and harvested around March-April. Higher procurement prices are expected to maintain or even increase acreage by assuring farmers of a minimum return from the next crop. Prolonged monsoon rains will help India's wheat crop during the winter season and output is expected to be at least at last year's record level of 85.93 million tons, Indu Sharma, director of India's Directorate of Wheat Research said Wednesday. Pawar said cabinet may also consider a one-time higher buy price for rice purchases.
He also said sugar output in India, the world's second-largest producer, is likely to be at least 25.5 million tons during the current marketing year that started Oct. 1.

Cold, Snowy Winter Forecast In Western Canadian Prairies (CME)
Harvest operations are wrapping up across western Canada under reasonably good weather conditions for the most part. While the bias should remain on the warm side through the autumn, the Prairies can expect to see a cold, snowy winter, according to one meteorologist. The early indications "suggest we'll see another winter of colder-than-usual conditions in the western Prairies," said Drew Lerner, president of Kansas City-based World Weather Inc. He said the coldest bias would be in Alberta and Saskatchewan, with Manitoba looking average from a temperature standpoint. "Manitoba will have its moments of cold, but they won't be consistent," said Lerner. Looking at snowfall, "La Nina is back, and I think we will see above average snowfall, especially in Alberta and southern Saskatchewan," said Lerner. He said the western part of Manitoba could also see above-average snowfall, but other parts of the province, including the Interlake, are forecast to see below-average snowfall.
The ground across most of western Canada is much drier heading into the winter then it was a year ago, which will lessen the spring flood potential, said Lerner. "Hopefully, it will be a better start to the season," he added. The 2012 growing season is still a long time away, but Lerner said one factor to watch was whether or not the La Nina conditions will persist. While he cautioned that there are many other unknown factors that will affect the weather next year, "if La Nina sticks around for the entire growing season next year, dryness could be more of an issue in the U.S. and some of that could work its way into Manitoba and southeastern Saskatchewan."

Markets bounce inline with commdities rebound
LONDON, Oct 5 (Reuters) - ICE sugar, coffee and cocoa futures bounced, in line with global stocks and other commodities including oil, as markets steadied after Europe's finance ministers agreed to safeguard euro zone banks from the spreading sovereign debt crisis.
A bearish target at 22.33 cents per lb remains intact for New York sugar  as indicated by its wave pattern and a bearish double-top, according to Reuters technical analyst Wang Tao.

Vietnam cuts 2011 coffee export forecast to 1.12 mln tonnes
HANOI, Oct 5 (Reuters) - Vietnam, the world's top robusta producer, has cut its annual coffee export projection for calendar year 2011 to 1.12 million tonnes, or 18.7 million bags, from 1.17 million tonnes, the agriculture ministry said.
August's export volume of 36,000 tonnes was below previous forecasts, leading to the downward adjustment for the whole of 2011, the ministry said in a report seen on Wednesday.

Honduras ends 2010/11 with jump in coffee exports
TEGUCIGALPA, Oct 4 (Reuters) - Honduras ended its 2010/11 coffee harvesting season with 22.3 percent more exports than during last year's cycle as the government backs an aggressive expansion of coffee growing areas, the national coffee institute Ihcafe said Tuesday.
September coffee exports jumped 74 percent from the same month in 2010 reaching 39,868 60-kg bags, Ihcafe said.

West Africa set for another big cocoa season
DAKAR, Oct 4 (Reuters) - West African plantations will churn out huge amounts of cocoa during the early months of this season thanks to near-ideal growing weather, and the full harvest is likely to rival last year's record volumes.
The region produced a record of nearly 3.2 million tonnes of cocoa during the 2011-12 season that just ended, raising its share of the global market to about 75 percent from two-thirds.

Australia Newcastle coal exports up 15 pct in week
Oct 5 (Reuters) - Thermal coal shipments from Australia's Newcastle port rose 15 percent in the week ending Oct. 3 to 2.377 million tonnes, recovering after bad weather slowed exports the previous week, the Newcastle Port Corporation said on its website on Wednesday.    
The vessel queue at the port fell to one ship from four, and the average waiting time for vessels dropped slightly to just over seven days.

Euro Coal - prices slide on Greek default fears
LONDON, Oct 4 (Reuters) - Prompt physical coal prices fell further on Tuesday as growing fears for the world economy and the possibility of a default by debt-stricken Greece took their toll.
Prices were down by around $2.00 a tonne due to the worsening economic backdrop.

Brent slips below $101 on Greek debt woes,Goldman outlook cut
SINGAPORE, Oct 4 (Reuters) - Brent crude slipped below $101, squeezed by growing fears that a Greek debt default could spread across the banking system and threaten the global economy.  
"I think more people are getting more afraid," said Tony Nunan, a Tokyo-based risk manager at Mitsubishi Corp.

Sri Lanka to call tenders for oil exploration in 5 blocks -minister
COLOMBO, Oct 5 (Reuters) - Sri Lanka will soon call tenders for oil exploration in five blocks in the island nation's north western offshore Mannar Basin, where Cairn India Ltd.  has discovered a gas deposit, the country's petroleum minister said on Wednesday.
"We will call tenders soon for the five blocks. It will be in couple of months," Petroleum Industries Minister Susil Premajayantha told Reuters, a day after he said Sri Lanka could start commercial production of natural gas within 18 to 24 months.

Crude Oil Trades Near Four-Day High on Shrinking Supplies, U.S. Job Growth (Bloomberg)
Oil traded near a four-day high in New York as investors bet that shrinking crude stockpiles and signs of an economic recovery in the U.S. indicate fuel demand may increase in the world’s biggest consumer of the commodity.  West Texas Intermediate futures were little changed after climbing the most in almost five months yesterday. Inventories fell 4.68 million barrels last week, a report from the Energy Information Administration showed. A gain of 1.5 million barrels was expected, according to a Bloomberg News survey. U.S. companies added more jobs than expected in September, data from ADP Employer Services showed. German Chancellor Angela Merkel said she is ready to discuss aid for European banks.
“A surprisingly positive U.S. EIA inventory report provided additional upside for WTI prices,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. “Commodity prices improved as European authorities appear to be stepping up support for European banks and U.S. private sector employment data was better than expected.”

Iron Ore-Spot prices seen near 3-month lows, China off
SINGAPORE, Oct Iron Ore-Forward swaps jump in thin volumes
SINGAPORE, Oct 5 (Reuters) - Prices of iron ore forward swaps rose in light volumes as the market looked to another listless session on Wednesday with top iron ore importer China still away for a week-long public holiday.
Swaps cleared by the Singapore Exchange  climbed on Tuesday with the November contract  gaining more than $7 to $155 a tonne, although traders said the thin volumes had exaggerated the price rises.

Nippon Steel unit to shift production to Thailand -Nikkei
Oct 5 (Reuters) - Suzuki Metal Industry Co , a key spring materials unit of Japan's Nippon Steel Corp , will move production from a domestic plant to Thailand, business daily Nikkei reported.
Suzuki Metal makes spring wire used in automobile engine valves and controls roughly 45 percent of the world market, the paper said.

Gold-Dollar Link Signals Longer Bullion Slump This Year: Chart of the Day (Bloomberg)
Gold may extend its slide from a record as Europe’s sovereign-debt crisis spurs demand for dollars, eroding the appeal of the metal as an alternative, according to John Stephenson at First Asset Management Inc. The CHART OF THE DAY shows gold plunged 11 percent last month, the most since 2008, as Europe’s worsening fiscal crisis sent the U.S. Dollar Index to an seven-month high of 78.863 on Sept. 26. The precious metal, which reached a record $1,923.70 an ounce on Sept. 6, may drop to $1,450 by Dec. 15, while the dollar index rallies to 89, the highest since March 2009, said Stephenson, who helps manage $2.6 billion. “The fear is Europe,” Stephenson said in a telephone interview from Toronto. “The dollar will go up significantly as we are seeing people liquidating other assets and buying the dollar and dollar-backed assets. Europe is nowhere near to finding a real solution.”

Baltic index falls, China slowdown weighs
LONDON, Oct 4 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, stayed negative for a sixth session in a row on Tuesday as sluggish cargo activity and worries for the world economy weighed on sentiment.  Brokers said growing vessel supply, which was outpacing commodity demand, was set to cap dry bulk freight rate gains in the coming months with economic uncertainty adding to headwinds.

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