Corn (Source: CME)
US corn futures end mixed, with nearby contracts continuing to succumb to speculative profit taking. However, new crop, deferred month contracts rally, as concerns about cool, wet conditions in the Midwest potentially delaying spring plantings, encouraged traders to add risk premium to prices, says Tim Hannagan, analyst with PFG Best. The corn crop must have strong yields to replenish depleted old crop stocks, and any delay to seedings threatens output potential. CBOT May corn down 0.2% at $7.54 1/4 a bushel, and December corn up 1.6% at $6.55 1/2.
Wheat (Source: CME)
The combination of sluggish export demand and the potential for needed rain to reach parched winter wheat crops in the plains pressured U.S. wheat futures. Forecasts for rains to hit some of the drier areas of the hard red winter wheat belt encouraged to traders to book some profits. The rains could improve crop ratings, analysts said. Lagging export demand and talk of Russia potentially reentering the world wheat market to export supplies earlier than expected added further pressure to keep buyers on the sidelines, said Jack Scoville analyst with Price Futures Group. CBOT May wheat was down 12 1/4c or 1.6% at $7.40 1/2 a bushel, May KCBT wheat was down 21c or 2.4% at $8.64.
Rice (Source: CME)
US rough rice futures ends higher, climbing on stronger demand and crop concerns. The rice market was presented with a pleasant surprise, larger-than-expected weekly export sales reported by the USDA. Dryness issues for rice crops in Texas provided additional support to offset general weakness in grain futures. CBOT May rice settled 4c higher at $13.66 1/2 a bushel.
U.S. wheat recovers from 2-week low; corn, soy steady
Chicago wheat futures rose around half a percent as the market recovered from a two-week low on concerns over dry weather in Europe and Australia's wheat producing areas. "It seems like the weather is improving for the wheat crop in the U.S., but we are still watching dryness in Europe, China and Western Australia, so there is little bit of concern," said Adam Davis, a senior commodity analyst at Merricks Capital in Melbourne.
Tight U.S. corn supply through 2011/12-Informa
WASHINGTON, April 13 (Reuters) - The U.S. corn supply will remain tight through fall 2012 despite
a potentially record-setting crop this year due to unrelenting food, feed and fuel demand, said
consulting company Informa on Wednesday.
Manila to award some rice imports rights, re-tender others-NFA
MANILA, April 13 (Reuters) - The Philippines' National Food Authority (NFA) said it will award more
rice import rights to private traders this week, taking cumulative allocations to nearly 500,000
tonnes out of a planned total of 600,000 tonnes for 2011.The revision, linked to the fast pace of exports in France, was 150,000 tonnes higher than
FranceAgriMer's March estimate and nearly 30 percent above the volume exported in the 2009/2010 season.The agency will seek new bids for the remainder of the rights next month, NFA administrator
Angelito Banayo told local reporters on Tuesday. The comments were not released until Wednesday.
India's key measures, decisions on wheat
NEW DELHI, April 14 (Reuters) - Indian farmers are expected to harvest a record wheat crop in
2011, higher than last year's 80.8 million tonnes, helped by good weather conditions and raising the
chance of exports.
The world's second-biggest wheat producer and consumer banned exports in 2007 to bolster
domestic supplies as bad weather hit crops.
India cautious over wheat exports as inflation bites
SINGAPORE/NEW DELHI, April 14 (Reuters)- Any government faced with huge grain stockpiles, strengthening global prices and prospects of record output would be tempted to jump into export markets, but India's policy makers will think twice before opening the floodgates for exports of wheat.
Wheat shipments from the world's second largest producer could partly fill a gap in global supplies caused by a shortfall in production in key exporters and calm the international market , which has soared almost 60 percent since April last year.
But India's federal government is expected to tread cautiously and, in the best-case scenario, allow exports of no more than 2 to 3 million tonnes -- just a fraction of the country's estimated 2011 production of around 84 million -- because of surging domestic food prices and exploding demand.
Ethanol Producers Face Uncertain Corn Supply (Source: CME)
Ethanol producers could be sweating out a late-summer squeeze on corn supplies, as stockpiles dwindle and farmers race to bring new supplies into the market. While the nation's supply of corn is not going to run out completely, the government is projecting ending stocks--or the amount of corn in storage as of Aug. 31--will be at their lowest level since 1996, the only other comparable year in recent history. Such tight supplies could leave producers at the mercy of their geographic proximity to corn and the pace of the fall harvest. Some producers may have to shut down temporarily. "The indications are there will be pockets of shortages," said Neill McKinstray, vice president of ethanol for The Andersons Inc. "It's certainly a real possibility." The supply squeeze would pose a challenge for the Toledo, Ohio, company, which has plants in Ohio, Michigan and Indiana, McKinstray said.
But its proximity to the nation's corn belt, existing grain merchandising business and above-average storage capacity should help keep the plants running, he said. Plants further away from the corn belt, particularly those on the coasts, face a greater danger of shutting down temporarily for a lack of corn, McKinstray said. Some ethanol plants shut down temporarily in 1996 as corn became scarce, said Jason Ward, analyst with Northstar Commodity in Minneapolis. He is advising clients, including livestock producers, to secure actual corn for the late summer time period, rather than just forward contracts. Come August, dwindling supplies could drive spot prices sharply higher, as buyers increase their bids to secure corn from grain elevators. Rather than being unable to find corn, a more likely scenario is that some ethanol producers walk away from high prices, said Todd Becker, chief executive of Green Plains Renewable Energy Inc., the nation's fourth-largest ethanol producer.
"The question will be, 'Do you want it at that price?'" Becker said. Ethanol producers have had little trouble securing corn through July, but forward-purchasing beyond that has been difficult. Based on current futures prices, farmers have a strong incentive to unload their corn sooner rather than later, as the July contract is roughly 60 cents per bushel, or 8%, more expensive than the September contract. That incentive for farmers to unload their remaining grain is the biggest danger for ethanol producers planning for August, Ward said. Ethanol plants generally have about two weeks of storage capacity, so some plants that are trying to buy corn now from farmers and paying them a premium to store it until later in the summer, analysts said. Working in ethanol producers' favor is the fact September corn prices are about 60 cents higher than December futures.
As a result, some farmers will plant fast-maturing seed varieties that could allow them to capitalize on the higher prices, before the new harvest floods the pipeline, said Chad Hart, agricultural economist for Iowa State University. The severity of the supply shortfall could also be limited if livestock producers start feeding their animals wheat instead of corn due to corn's high price, analysts said. Becker said that a "random producer here and there" may not be able to find corn, but that the problem will be short-lived. "If a problem develops it won't be a six-month problem, it will be a two-to three-week problem," Becker said. "That's not going to push anyone to the brink." Traders are already watching U.S. corn belt weather closely for signs of when planting will start. A slow start to planting season will mean a later harvest, which could exacerbate the supply squeeze, Ward said.
IKAR: Russia Grain Exports May Hit 9M Tons In 2011-12 (Source: CME)
Russia could export up to 9 million metric tons of grain in 2011-12 if the harvest hits 84 million tons, the director of the Institute for Agricultural Market Studies said, but he warned that growing problems in the key Volga region could hurt output. The Kremlin banned grain exports last summer after the worst drought in more than a century slashed the harvest by around a third to 63 million tons. But speculation has been building in the industry that the government may soon lift the embargo due to falling internal prices and hopes for a bumper 90-million-ton harvest later this year. IKAR's Dmitry Ryklo said although officials are concerned over how to finance the storage and insurance of the upcoming crop and bodies have been lobbying to lift the ban, no consensus has been reached.
AgResource Sees Record World Grain Demand In 2011/12 (Source: CME)
World grain markets are expected to remain bullish in the upcoming season as even a near-record world crop will be unable to meet a new high in demand, the president of U.S. grains analyst AgResource said. Daniel Basse said while world grain demand is expected to rise by 44 million metric tons to 1.795 billion tons in 2011-12 but even with good weather world production is expected to fall 3 million tons short of the world record in 2009. Global planting area will need to increase by 11.6 million hectares to 4987.4 million hectares in 2011 in order to boost production enough to build up stocks, he said. "A very bullish landscape still exists" in grain markets, Basse told the Black Sea grain conference. "We need another 52 million metric tons this year to build stocks and keep up with consumption." International grain prices have soared since last summer, reaching record highs in corn markets this year, as a succession of weather problems in key producers have failed to dent growing global demand.
Global food prices also hit record highs in February, according to the United Nations' food body, as gains in other markets like fats and sugar have pushed up the cost of staples the world over. The World Bank estimates 44 million people have been pushed into poverty by the rises. Yet Basse noted that despite the rising cost of grains, meat consumption has not been dented as it has been in the past. "Slaughter rates have not gone up in line with higher grain prices," he said. "As grain prices have rallied we in the U.S. have seen dramatic increases in meat prices, creating an economic incentive to keep producing meat."
Cocoa rises after grind data; sugar firms
ICE cocoa futures rose after Europe's first-quarter grind, a measure of demand, rose 3.5 percent on the year-earlier period to 353,103 tonnes, at the higher end of analysts' and dealers' expectations. Raw sugar futures on ICE firmed in early trade, with upside potential limited by bigger-than-expected Thai output. ICE raw sugar futures closed on Wednesday at their lowest level in six months, weighed by expectations of large Brazilian and Thai supplies.
Colombia coffee exports soar 53 pct in March-fed
BOGOTA, April 13 (Reuters) - Colombia's coffee exports shot up 53 percent to 884,000 60-kg bags
in March versus the same month last year, a trade group said on Wednesday, as growers took
advantage of record high prices.
The coffee futures market has doubled in value in a sustained rally that began in June 2010, with
much of the latest push driven by a scramble for high-quality beans. Coffee prices hit a 34-year
high last month.
Top India state set to miss sugar output target
LUCKNOW, India, April 13 (Reuters) - Sugar output from India's biggest cane growing state is likely
to be lower than a targeted 6 million tonnes this season due to crop shortage, an official said,
possibly jeopardising further exports from the world's number 2 producer of the sweetner.
A senior official of Uttar Pradesh state, which accounts for about a quarter of total sugar output, told
Brazil sugar exports face red tape at ports
SAO PAULO, April 13 (Reuters) - Brazil's ports again will look out on long lines of anchored vessels waiting to load sugar, with plans to expand loading capacity snagged on red tape, a top industry official said.
Last year, a log jam of over 100 unloaded ships waiting at Brazilian ports helped to boost sugar prices to 30-year highs, since the global market faced a supply deficit of the sweetener after several producing countries saw their output reduced by bad weather.
Brazil's exports in 2011 are expected to be higher than last year's record 28 million tonnes, but with its ports operating near near capacity, tightness in the sugar market could be magnified if serious bottlenecks reoccur.
Manila can export extra 60,000 T sugar to U.S.
MANILA, April 13 (Reuters) - The Philippines could export an additional 60,000 tonnes of sugar to the United States this year on top of the approved export quota of 136,201 tonnes given ample local supply, the local industry regulator's chief said on Wednesday.
On Monday, the U.S. Agriculture Department said the Philippines would be among the countries able to export more to the United States to counter a shortage caused by a hard freeze which hit the cane crop in Florida.
"We are still waiting for the official notice from the U.S. government but, yes, we can do that if there is a request for more Philippine sugar," Regina Bautista-Martin, chief of the Sugar Regulatory Administration (SRA), told Reuters.
Australia seen headed for another bumper cotton crop next year
SYDNEY, April 14 (Reuters) - Australia could harvest another bumper cotton crop next year,
possibly matching this year's estimated harvest of a record 4 million bales, an industry official said
on Thursday, noting that growing conditions remained ideal.
Australia, one of the world's major cotton exporters, is hoping to cash in on high global cotton prices
driven by strong demand from China and India, which together consume around 60 percent of
world output.
Rubber growers talk of intervention as price gyrates
BANGKOK/SINGAPORE, April 13 (Reuters) - A battle of nerves is shaping between rubber growers and speculators as uncertain demand due to the Japan earthquake and Middle East unrest offsets tight supply in a volatile market, but top producers stand ready to intervene if prices plunge.
Thailand, Indonesia and Malaysia threatened to take action to prop up prices in March, when tyre grades plunged about a third from a record above $6 a kg after Japan's devastating earthquake amplified fears about a weaker global economy, triggering selling on the Tokyo Commodity Exchange (TOCOM).
Prices later bounced on hopes for brief disruptions to Japan's auto production, but any drastic moves by producers, such as export cuts and stockpiling to avoid a repeat of the brutal correction, could slash the income of millions of farmers in Asia and feed unrest in places like southern Thailand.
China's tough talk on aluminium won't slow smelter growth
SINGAPORE/HONG KONG, April 14 (Reuters) - China is once more ratcheting up pressure on its aluminium industry to limit growth, but the measures are likely to fail without support from regional governments hungry for projects to generate jobs and boost economic growth.
The world's top aluminium producer and consumer has ordered a halt to all planned smelter projects and is considering cutting export rebates on some aluminium products as it tries to rein in the burgeoning energy-hungry industry.
Gold Leaps to Record on Inflation, Dollar; Silver Tops $42 at 31-Year Peak (Source: Bloomberg)
Gold climbed to a record as concern about rising inflation and an extended decline in the dollar bolstered the allure of precious metals as a store of value. Silver reached a 31-year peak.
PRECIOUS-Gold climbs as U.S. jobs data knocks dollar
LONDON, April 14 (Reuters) - Gold prices climbed back above $1,460 an ounce on Thursday and silver also rose after U.S. data showin
Chinese investors mull offshore yuan for bonded copper resale -trade
HONG KONG, April 14 (Reuters) - Investors in China who import copper to fund domestic projects are looking to use an offshore yuan scheme after authorities tightened rules on repatriating foreign currency from re-exports in April, trading and banking sources said on Thursday.
If the strategy succeeds, investors may not need to bring thousands of tonnes of bonded copper into Shanghai to resell it in the domestic market, an outcome that could boost supply and weigh on prices in the world's top consumer.
Zinc market near 200,000 T surplus in 2011 -ILZSG
LONDON, April 14 (Reuters) - Global refined zinc production will exceed demand by almost 200,000 tonnes this year, the fifth year running of over-supply, the Lisbon-based International Lead and Zinc Study Group (ILZSG) said on Thursday.
"The group expects that in 2011, the global refined zinc market will remain in surplus for the fifth successive year. The extent of the over-supply is forecast at just under 200,000 tonnes," ILZSG said in a statement.
Spot uranium seen averaging at $65/lb in 2011
LONDON, April 13 (Reuters) - Spot uranium prices look set to average $65 a pound this year, a Reuters survey showed, with estimates lower after Japan's nuclear disaster cast doubt over the future of nuclear power and offset some supply concerns.
Spot uranium , last around $59, has fallen some 10 percent since early March as the nuclear sector has come under scrutiny after Japan's earthquake and tsunami crippled a nuclear plant and caused radiation leakage.
METALS-Copper softer on China inflation worries
LONDON, April 14 (Reuters) - Copper fell to its lowest in more than a week on Thursday, as reports of quickening inflation in top consumer China signalled more monetary tightening that investors worried could hit demand for industrial metals.
Three-month copper on the London Metal Exchange (LME) was at $9,410 a tonne at 1312 GMT from $9,515 at the close on Wednesday.
Oil Gains a Third Day After Reports Saudi Arabia Cut Production This Month (Source: Bloomberg)
Oil gained for a third day in New York after a Saudi Arabia-based economist said the holder of the world’s biggest crude reserves cut production this month. Futures gained as much as 0.6 percent today after John Sfakianakis, chief economist at Riyadh-based Banque Saudi Fransi, said the desert kingdom reduced output by 300,000 barrels a day. Barclays Plc said Saudi Arabia may be reducing production of its lighter oil blends introduced in response to the slump from Libya.
