Wednesday, May 18, 2011

20110518 1818 FCPO EOD Daily Chart Study.

FCPO closed : 3297, changed : + 42 points, volume : higher.
Bollinger band reading : side way range bound.
MACD Histrogram : rising, buyer taking exposure.
Support : 3270, 3250, 3200, 3150 level.
Resistance : 3300, 3350, 3420, 3450 level.
Comment :
Boring FCPO closed recorded gains with higher volume changed hand while soy oil overnight closed recorded small gain and currently trading firmer.
Stronger palm oil demand prospect plus weather issue affecting soybean planting area influencing price of both palm oil and soy oil to move higher.
Daily chart formed a small up doji bar candle closed above middle Bollinger band level after market opened gap up and traded within a tight 18 points range bound market towards the end to closed above opening price.
Technical reading remained suggesting a side way range bound market development possibly testing higher 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.

20110518 1721 FKLI EOD Daily Chart Study.

FKLI closed : 1534.5 changed : +0.5 points, volume : lower.
Bollinger band reading : side way range bound.
MACD Histrogram : rising, buyer taking small exposure.
Support : 1530, 1515, 1500, 1485  level.
Resistance : 1540, 1550, 1565, 1580 level.
Comment :
FKLI closed recorded small gain with lower volume changed hand ahead of Malaysia 1st quarter GDP and consumer price index announcement later today doing about 5.5 points discount compare to cash market that closed little higher while regional markets trading mostly higher despite lower overnight U.S. market.
Daily chart formed a down doji bar candle with longer upper shadow closed between middle and upper Bollinger band level after market opened higher, surged upwards tested resistance near upper Bollinger band level before soften lower surrendered most of the intraday gain to closed near the low of the day.
Chart reading still suggesting a side way range bound market development testing support and resistance 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.

20110518 1544 Global Commodities Related News.

Ruchi Soya sees India's 2010/11 edible oil imports down 9 pct
NEW DELHI, May 17 (Reuters) - India's edible oil imports could drop 9 percent in the year to October due to higher domestic oilseed output, the managing director of Ruchi Soya Industries , the country's top importer of cooking oils, said on Tuesday. India, the world's biggest edible oil importer, bought 3.5 million tonnes of edible oils in the first half of 2010/11, down from 4.1 million tonnes in the year ago period.

U.S. oil rebounds more $1 a barrel on surprise gasoline stocks draw
SINGAPORE, May 18 (Reuters) - U.S. oil rebounded more than a $1 to $98 a barrel on Wednesday, after two straight sessions of declines, as a surprise drop in gasoline stocks allayed concerns about weaker demand ahead of the peak driving season.   "It has been a severe correction since two weeks ago after the dollar rebounded and the ECB didn't raise interest rates," said Tony Nunan, a Tokyo-based risk manager at Mitsubishi Corp.   "NYMEX has twice rebounded above $95, maybe the correction has run its course."

Australia Newcastle coal exports drop 8 percent in week
PERTH, May 17 (Reuters) - Coal shipments from Australia's Newcastle port, which ships mostly thermal coal used in power plants, dropped 8 percent during the past week due to lower demand.
Exports from the eastern coast port were 1.965 million tonnes in the week to May 16, down from 2.140 million the previous week, Newcastle Port Corporation said on its website on Tuesday.

US corn rallies to 2-wk top as weather threatens crop
SINGAPORE, May 18 (Reuters) - Chicago corn rose to its highest in nearly two weeks on Wednesday, while wheat hit a one-week top as adverse crop weather in the United States and Europe continued to threaten output.     "There are certainly a lot of concerns around the European weather as minimal rains are expected in the next two weeks," said Adam Davis, a senior commodity analyst at Merricks Capital in a Melbourne.     "Most of the anxiety about corn is for the eastern Midwest, also some issues in the northern part, so a lot of worry around the weather."

Brazil sugar shipments slow but improving
SAO PAULO, May 17 (Reuters) - The number of ships loading, waiting or arriving to export sugar from Brazil's two main ports is growing and should let up in the coming days, shipping agencies said.
The lineup of vessels reached 58 on Tuesday, slightly up from 55 a week ago. Although backlogs to haul sugar from the world's largest producer of the sweetener are not uncommon, these numbers are not normal for this early in the season.

Farmers threaten to boycott Morocco sugar refiner
RABAT, May 17 (Reuters) - Thousands of Moroccan sugar beet farmers are threatening to boycott the delivery of next year's crop to Cosumar  to press the country's sole sugar refiner for better terms, farmers said.
If the farmers carry through with their threat, Cosumar -- which has an annual refined sugar output of 1.2 million tonnes -- could be forced to increase the amount of raw sugar it imports, with Brazil its main supplier.

Argentine wheat area seen up 25 pct -gov't
BUENOS AIRES, May 17 (Reuters) - Argentine farmers are expected to plant 25 percent more wheat in the 2011/12 season, a senior Agriculture Ministry official said on Tuesday as early sowing gets under way.
Growers in the South American country, one of the world's leading wheat exporters and a key supplier to neighboring Brazil, produced a healthy 14.7 million tonnes of the grain in the last harvest thanks to favorable weather.

Cargill says resumes Ivory Coast cocoa operations
LONDON, May 17 (Reuters) - U.S. agribusiness Cargill has resumed its cocoa operations in Ivory Coast, the firm said on Tuesday.
Ivory Coast, the world's top cocoa producer, resumed cocoa bean exports earlier this month, after a disputed presidential election led to an export ban, European trade sanctions, a crippled banking system and weeks of civil war.

Dry weather to cut EU 2011 rapeseed crop-Oil World
HAMBURG, May 17 (Reuters) - Dry weather may cut the European Union's 2011 rapeseed crop to a three-year low of 19.5 million tonnes from 20.59 million tonnes in 2010, Hamburg-based oilseeds analysts Oil World said on Tuesday.
"The deterioration of rapeseed production prospects is about to reach alarming proportions," Oil World said.

Brazil's 2011 soybean crop at new record-Oil World           
HAMBURG, May 17 (Reuters) - Brazil's 2011 soybean crop is likely to hit a new record and its farmers may substantially expand soybean plantings for the 2012 crop, Hamburg-based oilseeds analyst Oil World said on Tuesday.
"The Brazilian soybean crop will probably reach a record 73.0-73.6 million tonnes against 68.7 million tonnes last year," Oil World said.

UK wheat exports slowed in March
LONDON, May 17 (Reuters) - UK wheat exports slowed further in March to 100,673 tonnes, the lowest monthly total so far in the 2010/11 season (July/June), customs data showed on Tuesday.
Cumulative exports for the season to date, however, stood at 2.34 million tonnes, still up by more than one-third from 1.73 million in the same period a year earlier.

S.Africa weekly white maize exports rise to 47,578 T
JOHANNESBURG, May 17 (Reuters) - South Africa exported 47,578 tonnes of white maize last week compared with 37,598 tonnes in the previous week, the South African Grain Information Service (SAGIS) said on Tuesday.
Exports of yellow maize were recorded at 12,463 tonnes, compared with 42,819 tonnes in the week before, SAGIS said

Copper rises on technicals, weaker dollar
SINGAPORE, May 18 (Reuters) - London copper rose on Wednesday, after ending down for the first time in four sessions in the previous day, on technicals and as the dollar firmed on disappointing U.S. housing data.    "The base metals market seems to be looking mostly at the dollar for price direction now," China Futures Co Analyst Yang Jun said.    "The weak U.S. housing starts data pointed to problems in the economy, which pressurises the dollar.  Also, the euro zone debt crisis seems stabilised with Portugal's bailout settled, which will lift the pressure on the euro in the short term," he added.

Gold gains after 3-day drop on Asian buying, weaker dollar
SINGAPORE, May 18 (Reuters) - Gold rose on Wednesday as Asian buyers snapped up bullion after a three-day losing streak, taking the cue from a weaker dollar, with the ongoing euro zone debt crisis also supporting sentiment.      "The slightly weaker dollar and some bargain hunting are helping gold's rebound," said a Hong Kong-based dealer.       "But the market does not have a clear sense of direction and a lot of people are just waiting." 

20110518 1120 Global Commodities Related News.

GLOBAL MARKETS: Stocks at 1-month low, euro edges up
NEW YORK, May 17 (Reuters) - World stocks fell to a one-month low on Tuesday on Europe's debt crisis and data that  spurred new doubts about the global economic recovery, while a late pick-up in the euro brought commodities off early lows.
"Today's market largely reflects the intensifying concerns that the global economy is slowing or worse," said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, New York.

OIL: Crude bounces from 12-week low after U.S. data
TOKYO, May 18 (Reuters) - U.S. crude futures bounced back on Wednesday after ending at a 12-week low following industry data that showed a surprise drop in U.S. product inventories.
U.S. crude stocks rose 2.7 million barrels last week, gasoline stocks fell   676,000 barrels and distillates dropped 2.8 million barrels, American Petroleum Institute data showed after Tuesday's settlement.

NATURAL GAS: ARA prices dip in line with oil's reversal
LONDON, May 17 (Reuters) - European coal prices were around $1.00 a tonne lower on Tuesday as the market tracked oil's earlier gains and later reversal and in the absence of clear fundamental direction.
"Coal is mostly just following oil, there's been very little physical buying and players in coal swaps aren't taking big positions," one major European swaps trader said.

EUROCOAL: ARA prices dip 50 cents on oil fall, dollar
LONDON, May 16 (Reuters) - European coal prices softened by around 50 cents a tonne on Monday in line with oil's slight fall and the stronger dollar but few trades were reported.
"Demand is weak in Europe but the full impact of weak demand and increasing arrivals of coal cargoes has yet to be felt or reflected in prices," one major European utility said.

COMMODITIES: Grains surge again as oil, gasoline slip
NEW YORK, May 17 (Reuters) - Grains markets kept up a feverish rally on Tuesday on weather concerns while crude oil fell again after weak U.S. economic data fed worries about oil demand in the world's top energy consumer.
"I do think this grains rally has legs, and we could see money coming out of other sectors to keep it going," said Sterling Smith, analyst at Country Hedging Inc. in St. Paul, Minnesota.

U.S. oil prices climb more than $1 on products drop
HOUSTON, 17 May (Reuters) - U.S. crude oil futures jumped more than $1 a barrel after Tuesday's settlement as the industry group American Petroleum Institute reported drops in national gasoline and distillate stockpiles last week.
June delivery crude hit $98.00 a barrel, up $1.09 a barrel. on the New York Mercantile Exchange's Globex trading platform.

20110518 0952 Global Economic Related News.

China: Reduces US treasury holdings as debt ceiling debated
China, the biggest foreign owner of U.S. government debt, trimmed its holdings of Treasuries for a fifth straight month in March as lawmakers debate how to expand borrowing after reaching a statutory threshold. The Asian nation owns USD1.145 trn of the debt, down USD9bn, or less than 1%, from the previous month, according to Treasury data released yesterday. The holdings reached a record USD1.175 trn in October. China’s concern that U.S. government securities may become more risky because of the nation’s deficits and debt burden prompted its call this month for President Barack Obama’s administration to lay “a solid fiscal foundation” for long- term growth. (Bloomberg)

China: Foreign direct investment climbed 15% YoY in April as companies including Starbucks Corp. and Walt Disney Co. expand to tap rising incomes in the world's fastest-growing major economy. Investment rose to USD 8.5b. The increase compared with a 33% YoY gain in March. For the first four months, the total was USD 38.8b, a gain of 26% YoY. (Source: Bloomberg)

Vietnam: Raises interest rate, revives Vietcombank share sale
Vietnam raised a key interest rate for the second time this month and revived a state-bank share sale as the government struggles to damp the fastest inflation in Asia and shore up public finances. The State Bank of Vietnam raised the repurchase rate to 15% from 14%, effective from 17 May, according to an email from the central bank. The Joint-Stock Bank for Foreign Trade of Vietnam, or Vietcombank, said Credit Suisse will advise it on a plan to sell a maximum 20% stake to foreign investors by early 2012. (Bloomberg)

New Zealand: May cut retirement subsidies in budget to pay quake costs
New Zealand’s government may cut pension subsidies and review other social payments in an election-year budget aimed at returning the nation’s fiscal position to a surplus and maintaining its credit rating. Prime Minister John Key has said he may lower contributions to a workplace savings program and review entitlements to family payments in the 19 May budget, a four-year plan starting 1 July. New spending on health and education must be funded by reductions in outlays elsewhere as the country faces an estimated NZD8.5bn (USD6.7 bn) of costs from two earthquakes in its second-biggest city, Christchurch. (Bloomberg)

Germany: Investor confidence declined for a third month in May as faster inflation threatened to curb consumer spending and Europe's sovereign-debt crisis worsened. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict developments six months in advance, fell to 3.1 from 7.6 in April. (Source: Bloomberg)

EU: Finance ministers approve EUR78bn Portugal bailout
European Union finance ministers cleared the way for Portugal to receive EUR78bn (USD111bn) in aid, making it the third euro-area country to fall back on official loans. The endorsement came at a meeting of EU finance ministers in Brussels, European Commission economics spokesman Amadeu Altafaj said. (Bloomberg)

UK: Inflation quickens to 4.5%, forcing letter from King
UK inflation accelerated more than economists forecast in April to the fastest since October 2008, forcing Bank of England Governor Mervyn King to explain publicly why officials haven’t raised interest rates yet. Consumer prices rose 4.5% in April after a 4% increase in March, data showed. The median forecast of 32 economists in a Bloomberg News survey was 4.1%. Core inflation quickened to the fastest in at least 14 years. King said in a letter to Chancellor of the Exchequer George Osborne that the surge is being driven by higher sales tax and increases in energy and import prices. (Bloomberg)

US: April industrial production unexpectedly stalls on autos
Industrial production in the US unexpectedly stalled in April, reflecting a drop in automobile output after supplies of parts were disrupted by the Japanese earthquake and tsunami. Output at factories, mines and utilities was unchanged after a 0.7% gain in March, figures from the Federal Reserve showed. Manufacturing fell 0.4%, while it rose 0.2% excluding automobiles. Economists had forecast a 0.4% gain in industrial production, according to the median estimate in a Bloomberg News survey. Production of automobiles and parts dropped 8.9% in April, a decline that may be temporary as Japanese manufacturers recover from the March disaster. (Bloomberg)

US: Housing starts unexpectedly fell in April to 523,000 pace
Housings starts in the US unexpectedly fell in April as home builders continued to struggle almost two years into an economic recovery. Work began on 523,000 houses at an annual pace, down 11% from the prior month and less than the 569,000 median forecast of economists surveyed by Bloomberg News, figures from the Commerce Department showed in Washington. Building permits, a sign of future construction, also decreased. Falling home values and the prospect of more foreclosures entering the market mean home construction will be slow to gain traction. Unemployment at 9% and stagnant wages indicate any recovery in housing may take years to unfold. (Bloomberg)

U.S: Global demand for long-term assets slowed in March as investors shifted into shorter-term securities and China trimmed its portfolio of Treasuries. Net buying of long-term equities, notes and bonds totaled USD 24b during the month, compared with net buying of USD 27.2b in February. Including short-term securities such as stock swaps, foreigners purchased a net USD 116b, compared with net buying of USD 95.6b the previous month. (Source: Bloomberg)

20110518 0950 Malaysia Corporate Related News.

KLCI chart reading :
side way range bound little upside biased.

MPHB a surprise RAPID winner
While oil and gas (O&G) companies are already identified as prime beneficiaries of the USD20bn (RM60.8bn) Refinery and Petrochemicals Integrated Development (RAPID) in Pengerang Johor, a surprise winner arising from the project is Multi-Purpose Holdings Bhd (MPHB). MPHB, which is undergoing a makeover to become a pure number forecast operator (NFO), has 4.641.3 acres of plantation in Pengerang with some portions fronting the sea. The land is said to be next to the site where the various RAPID projects are to be located. (Financial Daily)

Bland puts to reset concerns on RM711m bond redemption
The speculation on Berjaya Land Bhd (Bland) undertaking a massive restructuring to redeem a RM711m bond issue was put to rest on Monday when the company announced that it had deposited the required sum into a reserve account, fulfilling its obligation to bondholders. The amount was due on 15 August this year, which means Bland is ahead of schedule to redeem the five year debt paper issued in 2006.(Financial Daily)

Latexx shareholders denied exit opportunity, lose money
Shareholders of Latexx Partners Bhd must be wondering what went wrong with the takeover deal of the company.On Monday, Latexx shares plummeted by 10% after the company said the deal was aborted. Monday's closing price of RM2.40 is also a significant drop from the indicative offer price of RM3.10 that was stated on Jan 31 when the company received a conditional offer to buy out its assets. But in explaining why the deal was aborted, Latexx only said the parties could not agree on the terms of the deal. (StarBiz)

Billionaire Syed Mokhtar to list three of his MMC units worth RM13bn
MMC Corp Bhd, a company owned by billionaire Tan Sri Syed Mokhtar Al-Bukhary, will spin off three of its subsidiaries worth a total of RM13bn for a listing either this or next year. Group managing director Datuk Hasni Harun said the corporate exercise would likely see Gas Malaysia Sdn Bhd listed first followed by the re-listing of Malakoff Bhd and Johor Port Bhd.“We are planning to unlock value via possible listing of our stable of companies,” Hasni said reporters after its AGM yesterday. He said MMC was currently conducting financial and technical due diligence to get the go-ahead from the board of directors. (StarBiz) 

Consumer: Price of RON95 petrol will be reviewed in June. The prices of all petroleum products, including RON95 petrol, will be reviewed in June. The price revision, to be conducted by the ministry and other agencies such as the finance ministry and the Performance Management & Delivery Unit (Pemandu), would determine whether the prices would be maintained or increased, depending on the government's subsidies. (Source: The Star)

Consumer: Super Subsidy for diesel to be abolished from June 1. The government will abolish the super subsidy for diesel given to nine types of commercial vehicles including limousine taxies, effective June 1. All the nine listed vehicles would no longer be allowed to purchase fuel at a subsidized price of RM1.48 per litre, but purchase at a higher subsidized price of RM1.80 per litre instead. (Source: The Malaysian Reserve)

Shipping: Dry bulk, container shipping rates firm up. Global dry bulk and container shipping freight rates are expected to firm up further this year buoyed by the increase in demand and bunker fuel prices. (Source: The Star)

FDI: Invest Malaysia attracts 201 US investors. A total of 201 US brokers, bankers, index providers, multinational companies and fund managers will participate in the inaugural Invest Malaysia New York 2011. (Source: The Edge Financial Daily) 

20110518 0944 Global Market Related News.

 DJIA chart reading : side way range bound little upside biased..

Hang Seng chart reading : downside biased. 

Asia shares steady, firm dollar weighs on oil
SINGAPORE, May 17 (Reuters) - Japanese stocks held steady after early losses on signs of a slowdown in the U.S. economic recovery and oil fell for a second session as the dollar edged higher on euro debt concerns. "All eyes are now on commodities," said Takashi Ohba, a senior strategist at Okasan Securities. "Normally falls in commodities would be considered positive for the economy, but these days that market has become a barometer for risk-taking -- commodities are lower, so everyone is in a 'risk-off' mood."

Housing Starts in U.S. Unexpectedly Fall to 523,000 Pace; Permits Decline (Source: Bloomberg)
Housings starts in the U.S. unexpectedly fell in April as flooding and tornadoes in the South shut down construction sites and homebuilders continued to struggle almost two years into an economic recovery.

U.S. Industrial Production Stalls on Auto Disruption; Housing Starts Drop (Source: Bloomberg)
Industrial production in the U.S. unexpectedly stalled in April and housing starts dropped, posing hurdles to a rebound from the first quarter’s economic slowdown.

NY manufacturing growth slowest in 5 months in May
NEW YORK, May 16 (Reuters) - Manufacturing in New York State grew at its slowest pace in five months in May, while U.S. homebuilders remained deeply pessimistic as buyers stayed away from the market, data released on Monday showed.
But even as the Federal Reserve Bank of New York reported that general business conditions of its "Empire State" index fell to the lowest level since last December, there were signs of underlying strength. A gauge of employment rose to the highest level in seven years, and economists said the data likely suggested more of a soft patch in the recovery than a slowdown.

China Trims U.S. Bond Holdings for Fifth Month as Debt Approaches Ceiling (Source: Bloomberg)
China, the biggest foreign owner of U.S. government debt, trimmed its holdings of Treasuries for a fifth straight month in March as lawmakers debate how to expand borrowing after reaching a statutory threshold. The Asian nation owns $1.145 trillion of the debt, down $9 billion, or less than 1 percent, from the previous month, according to Treasury data released yesterday. The holdings reached a record $1.175 trillion in October.

Foreign Investment in China Rises 15% as Consumers Lure Starbucks, Disney (Source: Bloomberg)
Foreign direct investment in China climbed 15 percent in April as companies including Starbucks Corp. (SBUX) and Walt Disney Co. expand to tap rising incomes in the world’s fastest-growing major economy. Investment rose to $8.5 billion, the Ministry of Commerce said in a statement in Beijing today. The increase compared with a 33 percent gain in March. For the first four months, the total was $38.8 billion, a gain of 26 percent.

Yen Falls to One-Week Low on GDP Report (Source: Bloomberg)
The yen touched a one-week low against the euro before a report tomorrow forecast to show Japan’s economy contracted in the first quarter.

Japan Stocks Rise on Weaker Yen; Tokyo Electric Advances on Nuclear Plans (Source: Bloomberg)
Japan’s Topix index of stocks rose for the first time in five days as the yen weakened and after Tokyo Electric Power Co. announced a revised plan for stabilizing its stricken Fukushima Dai-Ichi nuclear-power plant.

German Investor Confidence Drops More Than Forecast on Prices, Debt Crisis (Source: Bloomberg)
German investor confidence declined for a third month in May as faster inflation threatened to curb consumer spending and Europe’s sovereign-debt crisis worsened. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict developments six months in advance, fell to 3.1 from 7.6 in April. Economists expected a drop to 4.5, according to the median of 31 estimates in a Bloomberg News survey.

April Inflation Accelerates More Than Forecast to Fastest Pace Since 2008 (Source: Bloomberg)
U.K. inflation accelerated more than economists forecast in April to the fastest since October 2008, forcing Bank of England Governor Mervyn King to explain publicly why officials haven’t raised interest rates yet. Consumer prices rose 4.5 percent in April after a 4 percent increase in March, data today showed. The median forecast of 32 economists in a Bloomberg News survey was 4.1 percent. Core inflation quickened to the fastest in at least 14 years. King said in a letter to Chancellor of the Exchequer George Osborne that the surge is being driven by higher sales tax and increases in energy and import prices.

Bank of Korea’s Kim Says Monetary Policy Aims to Prevent Lending Excesses (Source: Bloomberg)
Bank of Korea Governor Kim Choong Soo said that the central bank will manage monetary policy carefully in order to avoid creating incentives for excessive borrowing by households or companies.

Australia Central Bank Foresees Need for Higher Rates to Contain Inflation (Source: Bloomberg)
Australia’s Treasury secretary said the local currency will stay elevated “for some time,” a rise the central bank signaled would help contain inflation spurred by the nation’s biggest mining-investment boom. “The Australian dollar, which is currently at record levels, can be expected to move roughly in line with the terms of trade over the longer term,” Martin Parkinson, the Treasury’s top bureaucrat, said in a speech today in Sydney, referring to a measure of export income. “It is therefore expected to also remain persistently high for some time.”

Australian Dollar Maintains Gain on Speculation Wage Growth Accelerated (Source: Bloomberg)
The Australian dollar held onto yesterday’s gains versus the greenback before a government report today that economists said will show wages grew at a faster pace in the first quarter.

FOREX-Euro off 7-week lows; investors jittery on Greece
LONDON, May 17 (Reuters) - The euro pulled away from a seven-week low against the U.S. dollar on Tuesday, but remained vulnerable on the downside as investors looked at opportunities to trim bullish bets while uncertainty over Greek debt lingers.
The yen was under broad pressure on talk of merger and acquisition flows, while sterling jumped against the U.S. dollar and the euro after UK inflation leapt in April to its highest annual rate since October 2008.

20110518 0941 Global Commodities Related News.

Corn (Source: CME)
US corn futures finish sharply higher on concerns farmers will plant fewer acres than they previously intended due to excessive rains. Farmers are struggling to sow the crop in the eastern Midwest and northern Plains and may give up on planting unless the weather clears up. If corn is planted late, the crop produces lower yields because it must develop during the peak of summer heat. "We're running out of time," says Bill Gentry, analyst for Risk Management Commodities. CBOT July corn jumps 22 3/4c to $7.20 1/4 a bushel.

Wheat (Source: CME)
US wheat futures finish up sharply on worries harsh weather will reduce harvests. Excessive rains are slowing planting of spring wheat in the northern Plains and threatening the quality of soft red winter wheat in the Midwest. Drought already has slashed the harvest of hard red winter wheat in the southern Plains. Western Europe also is dealing with dryness and heat. CBOT July wheat surges 27 1/2c to $7.64 a bushel; KCBT July jumps 18 1/2c to $8.94 1/2; MGE July climbs 26c, or 2.9%, to $9.36 1/4.

Rice (Source: CME)
US rice futures finish stronger as the grain markets extend gains on weather concerns. Rains and floods are delaying planting in the South. The USDA confirmed the disruptions, saying farmers had sown 69% of the crop as of Sunday, below the average of 83% for that time of year. The crop was rated 54% good to excellent, down from 64% a year ago. CBOT July rice rises 28 1/2c to 14.39 per hundredweight.

Corn plantings seen 60 pct done, soybeans 20 pct
KANSAS CITY, Mo., May 16 (Reuters) - U.S. farmers made good progress on closely watched corn plantings over the last week, but more rain in the forecast and a rapidly closing window for optimal seeding kept some industry players on edge.
The pace of both corn and soybean planting remains well behind schedule but picked up dramatically over the last week as farmers raced to take advantage of a break from incessantly wet spring weather, analysts surveyed by Reuters said on Monday morning.

U.S. corn, soybeans post modest gains on crop concerns
SYDNEY, MAY 17 (Reuters) - U.S. corn and soybean futures posted modest gains in quiet Asian trade as market players assessed a U.S. government report showing planting crops in the United States remained well behind schedule. "It is almost as though no-one is willing to trade this market until the U.S. gets a full day's trading on the crop progress report," said Adam Davis, senior grains trader at Melbourne-based Merricks Capital.

Philippines sees Q3 rice output up 32 pct on yr
MANILA, May 17 (Reuters) - The Philippines' unmilled rice output in the third quarter is forecast to rise 32 percent from a year ago to 3.49 million tonnes as better rains result in higher yields from an expanded harvest area, the Bureau of Agricultural Statistics (BAS) said on Tuesday.
The projected growth in July to September, a lean period for rice production due to the onset of the rainy season, puts less pressure on the country to import more rice this year.

W. Canada plants 20 pct of crops, favorable forecast seen
WINNIPEG, Manitoba, May 16 (Reuters) - Western Canada farmers took advantage of favorable weather in Alberta and parts of western Saskatchewan to push overall crop seeding progress to 20 percent, the Canadian Wheat Board said on Monday.
Farmers have also started to plant in some areas of eastern Saskatchewan, south central and southeastern Manitoba, the Wheat Board said in its weekly bulletin..

Cold and wet delay Midwest planting
Cold and wet weather continued to delay crop planting in the Midwest, with the lengthiest in the eastern crop region including Indiana and Ohio. Major flooding on the Mississippi River was hitting more farmland, and the return to wet weather later this week will spawn more flooding.
Significant losses to corn and wheat acreage are expected.

Frost hits U.S. Corn Belt and southern Plains wheat
CHICAGO, May 16 (Reuters) - Freezing temperatures hit parts of the northern U.S. hard red winter wheat belt and much of the western Corn Belt on Monday morning, raising worries that some crops may have been damaged, a forecaster said.
Morning lows in wheat country dipped to 30 to 35 degrees Fahrenheit (-1 to -2 Celsius) in western Kansas, eastern Colorado and southwestern Nebraska. In the Corn Belt, northern Iowa and eastern Nebraska saw lows near 33 degrees F.

Bulgaria expects unchanged wheat harvest
SOFIA, May 16 (Reuters) - Bulgaria expects to reap 3.9 million tonnes of wheat this year, the agriculture ministry said on Monday, virtually unchanged from 2010.
"With good development of sowings and favourable agrotechnical conditions ... the total wheat production this year would reach 3.9 million tonnes," the ministry said in a statement.

Concern continues about parched German wheat
HAMBURG, May 16 (Reuters) - Concerns about dryness damage to German wheat plants persist after heavy rain forecast for the weekend often failed to materialise, traders said on Monday.
Crop watchers are concerned the wheat harvest in Germany, the EU's second largest grain producer, will suffer after only 38 percent of average rain fell in April and with early May also very dry.

Bullish funds slash commodity bets by $17 bln-data
NEW YORK/CHICAGO, May 13 (Reuters) - Big hedge funds and speculators cut their bullish bets on commodity markets by $17 billion in the week through Tuesday, the biggest bear turn since at least 2009, regulatory data showed on Friday.
The so-called "managed money" funds cut their overall net long holdings in 22 U.S. futures markets by over 222,000 contracts or 13 percent in the five days ended May 10, according to Reuters calculations based on the Commodity Futures Trading Commission's weekly Commitment of Traders.

UK Farm Ministry Prepares To Tackle Drought (Source: CME)
Preparations are underway across the U.K. to ensure any potential drought doesn't harm the country's agriculture, Farm Minister Caroline Spelman said, although observers warned crops in some regions may be beyond help. Speaking after a meeting with farming groups and environment agencies, Spelman said assessments are being made to determine the "likelihood of a drought in the longer term, and how it might affect our farmers, our food industry and consumers." "The Environment Agency, together with the water industry, are going to provide me with an update on water supplies and they are also going to review their drought plans," she said. England and Wales have seen the lowest rainfall in March and April since 1938 while meteorologists have recorded the warmest spring in centuries. Forecasters now predict a heatwave in the coming weeks means May could prove to be the hottest since records began 353 years ago.
Some areas in the south east have received just 20% of their average rainfall so far this month, although in parts of Scotland, more than the total May average rainfall has fallen to date this month. Four regions around the west and east Midlands and East Anglia have already been given potential drought status said Jenny Bashford, water policy advisor at the National Farmers Union, who attended the meeting. She emphasized, however, that the problems are localized and said that water companies are working to create contingency plans in the event other areas are threatened by drought. The NFU is also working with farmers to ensure effective planning for the use of water resources, she said. "This isn't a drought on the scale of 1976," she said. "The scale and the impact of the problem is localized both geographically and in terms of the products that are grown. The plans being put together are more long-term."
Yet the lack of rainfall is already stressing U.K. barley and wheat crops. David Eudall from the Home Grown Cereals Association recently said that in many places crop development is already two weeks ahead of schedule, meaning yields could fall. Forecaster WeatherEdge Ltd. warned that wheat yields could drop up to 15% this year due to the dry weather, putting pressure on already near record-high prices for U.K. feed wheat. The NFU's Bashford said that for farmers growing crops like wheat and barley in lighter soils crops could face "serious problems." But she said that current high prices meant some farmers are finding it economically viable to irrigate crops even at this early stage. "It's unheard of to be irrigating uncombinable crops but the value of the crop makes it worthwhile to spend the money rather than losing them," she said.
Spelman said water groups, including Water U.K., are preparing contingency for further problems and further plans will be considered in a month's time if the situation has not changed.

FAO: Biofuels Could Boost Developing World Food Security (Source: CME)
Investment in biofuels could actually help to improve food security in rural economies by creating jobs and boosting incomes, the United Nations' food body said, adding its voice to a growing debate over the impact of biofuels on agriculture. Controversy over using farmland to grow fuel crops has intensified this year as world food prices have hit record levels, pushing 44 million people into poverty, according to World Bank estimates. Some critics argue that increasing the amount of land devoted to biofuels will further strain hard-pressed agricultural resources. Others say biofuels can encourage deforestation in the developing world, releasing more carbon dioxide into the atmosphere than is offset by burning the fuel. But the Food and Agriculture Organization said if managed responsibly, cultivating crops for fuel, such as sugar and corn, can actually spark much-needed investment in agricultural and transport infrastructure in rural areas.
"Done properly and when appropriate, bio-energy development offers a chance to drive investment and jobs into areas that are literally starving for them," said Heiner Thofern, who heads FAO's Bioenergy and Food Security project. He cited the growth of potential export markets for bio-energy products like Europe as presenting farmers in the developing world with new opportunities to access world markets and boost their household incomes. World food prices surged to precedent levels in February. This second price spike in four years has re-ignited the debate over government incentives for biofuels, schemes which some international agencies have blamed for sparking the food crisis of 2007-08. U.S. lawmakers are currently in the process of reconsidering their controversial subsidies policy for corn-based ethanol. A bill introduced earlier this month aims to eliminate the 45-cents-a-gallon tax credit at a time when refiners are expected to use a record 5 billion bushels this season.
"A third of the supply of U.S. corn is being diverted to biofuels and of course, that has an impact," said Jay Naidoo, chair of the board of directors of the Global Alliance for Improved Nutrition, an organization devoted to improving diets for poor people around the world. Yet the FAO isn't alone in arguing that biofuels could encourage much-needed investment in farming. A study by the International Energy Agency released last month found that with improved land use management, increasing biofuels production to meet 27% of demand will only need 100 million hectares worldwide, around 5% of global agricultural land. "We aren't pretending that biofuels are the answer to everything but we think they can provide an impetus to improve sustainable policies," said Paolo Frankl, head of the IEA's renewable unit.
In order to help governments evaluate the feasibility of bio-energy development and the impacts on food availability, the FAO has developed a framework to help policymakers weigh the pros and cons of the sector, including social impacts. "Our goal is to help policy-makers take informed decisions regarding whether bioenergy development is a viable option," said the FAO's Thofern.

Wheat Damage Claims on Dry Weather May Signal Worse Harvest Than Forecast (Source: Bloomberg)
Wheat crops in the U.S. Great Plains are showing signs that production may plunge more than the government forecast last week as hot weather and a lack of rain erode plant quality and force farmers to harvest early. As of May 15, U.S. winter-wheat was in the worst condition since 1996, with 44 percent of fields rated poor or very poor by the government. The National Weather Service estimates rainfall in the past two months was less than half of normal in much of Texas, Oklahoma and Kansas, where insurance adjuster David Reed said he’s had 300 farmer claims for drought damage in his area this season, already 10 times more than last year.

Argentina Official: China Corn Deal May Take 6 Months To Complete (Source: CME)
A deal for Argentina to export corn to China may take six months to a year to complete, Argentina government officials said. The timeframe is longer than some in the Argentine farm lobby previously forecast, suggesting still some months before the two countries reach a phytosanitary agreement needed for the grains to be shipped. The bulk of Argentina's corn is from transgenic crops that haven't been cleared for sale in China. The corn deal could be completed by the end of the year, said Marcelo Lucco, director of export promotion at Argentina's Ministry of Foreign Affairs. The officials, led by Undersecretary for International Trade Ariel Schale, declined to project China's potential corn demand once the agreement is signed.

Mississippi River Diversion Cuts Threat to Cities, Refineries, Croplands (Source: Bloomberg)
Mississippi River water pouring through 15 gates on Louisiana’s Morganza floodway has greatly reduced the risk of flooding to oil refineries that account for about 14 percent of U.S. capacity. The diversion means the Mississippi has crested at about 17 feet in New Orleans, 2.5 feet below the forecast, and is expected to top out at 45 feet in Baton Rouge, below a record 47.5 that was expected by May 22, according to the U.S. Lower Mississippi River Forecast Center’s website.  Oil Rises From Three-Month Low as Supplies of Cushing Crude, Gasoline Drop Oil advanced from the lowest in almost three months in New York after an industry-funded report showed gasoline stockpiles dropped and crude inventories at Cushing declined the most since June in the world’s biggest consumer of the fuel. Futures gained as much as 1.1 percent today, after the lowest settlement since Feb. 22.
Inventories at Cushing, Oklahoma, the delivery point for the West Texas Intermediate grade, slid 1.5 million barrels last week, the American Petroleum Institute said. Gasoline supplies fell 676,000 barrels, contrasting with estimates that an Energy Department report today will show they increased 950,000 barrels.

Cargill Resumes Cocoa Operations In Ivory Coast (Source: CME)
Commodities trade house Cargill Inc. said it has resumed operations of its cocoa business in Ivory Coast in the wake of months-long political turmoil there. More than 400,000 tons of cocoa beans, the raw ingredient in chocolate, had been tied up in Ivory Coast since late January amid a power struggle between two presidential hopefuls that led to a ban on cocoa exports. Ivory Coast supplies more than one-third of the world's cocoa. "The situation is continuing to improve with visible and practical signs that the country is on the road to recovery following the months of instability and uncertainty after the presidential elections," said Jos de Loor, head of Cargill's cocoa and chocolate arm in an e-mailed statement. The company said cocoa exports would resume in the "next few days" and said its cocoa supplies are "sufficient to meet our 2011 commitments."
Earlier this month, Switzerland-based Barry Callebaut AG (BARN.EB), the world's largest chocolate maker, said it planned to resume cocoa exports this month. Kip Walk, head of cocoa at Chicago-based Blommer Chocolate Co., which processes cocoa for major candy manufacturers, said it expects its first delivery of Ivory Coast cocoa beans by late May.

ICE sugar, coffee, consolidate higher
LONDON, May 17 (Reuters) - ICE raw sugar and arabica coffee edged higher in early trading on Tuesday, as softs markets consolidated following the recent slide in commodity markets, while cocoa eased. Sugar futures nudged higher, supported by tight new-crop sugar supplies from Brazil, where mills have been focussed on ethanol production.

Gold Declines to One-Week Low as U.S. Housing Data Damps Commodity Outlook (Source: Bloomberg)
Gold futures fell to a one-week low as signs that the U.S. economy is slowing eroded the appeal of commodities. Silver dropped more than 2 percent. Housing starts declined unexpectedly in April, and any recovery in construction may take years because unemployment is lingering around 9 percent and wages are stagnant. The Thomson Reuters/Jefferies CRB Index of 19 raw materials dropped for the third straight session.

LME aluminium stocks hit record above 4.71 mln T
LONDON, May 17 (Reuters) - Stocks of aluminium in London Metal Exchange warehouses jumped 22,625 tonnes to hit a record high of 4,710,550 million tonnes, data showed on Tuesday.
A backwardation or premium for the cash contract against the three-month contract is attracting metal to LME warehouses.

Aluminium premiums in Europe hold at highs
LONDON, May 16 (Reuters) - Premiums for duty-paid physical aluminium in Europe have held around record highs, supported by the fact that much material is tightly-held, traders said.
Although large amounts of aluminium are held in London Metal Exchange warehouses, much of it is tied up in financing deals through which metal holders profit if prices rise faster than storage costs.

Citigroup cautious about copper on lower China demand
May 16 (Reuters) - Citigroup said it was upbeat on iron ore, met coal and aluminum but cautious on copper due to further monetary tightening in top consumer China.
China lifted bank reserve requirements by 50 basis points on Thursday, signalling that containing inflation and soaking up excess cash remained its top priority even after signs the economy was slowing down.

US copper import surge led by manufacturing bounce
NEW YORK, May 16 (Reuters) - U.S. copper imports climbed to a two-year peak in March, snapping back-to-back monthly declines in the first two months of the year, as demand for the metal grew with a sustained recovery in manufacturing.
As inbound shipments of copper broke higher, aluminum imports sputtered, falling 20 percent in the first quarter -- a trend that could continue in the coming months as the combination of production restarts and sky-high prices on the London Metal Exchange (LME) deter consumer appetites.

China refined nickel imports to drop as NPI output grows-industry
HONG KONG, May 17 (Reuters) - China's imports of refined nickel will drop sharply as new nickel-pig-iron projects come online in the next two years, boosting production of the cheaper replacement by as much as a quarter this year and doubling it by 2013, industry watchers said on Tuesday.
China, the world's leading nickel consuming nation, is expected to produce more than 200,000 tonnes of nickel in the form of nickel-pig-iron, or NPI, this year, compared to 160,000-170,000 tonnes last year, analysts estimated, including Fan Runze at state-backed research firm Antaike.

METALS-Copper climbs on signs of China demand support
LONDON, May 17 (Reuters) - Copper rose on Tuesday as the euro advanced against the dollar ahead of a series of U.S. economic reports, while signals that Chinese consumers are returning to the market underpinned prices.
Benchmark copper  on the London Metal Exchange traded at $8,900 a tonne at 1008 GMT, up from $8,840 at Monday's close.

PRECIOUS-Gold rises as dollar retreats from 7-week high
LONDON, May 17 (Reuters) - Gold rose on Tuesday as the dollar eased from a seven-week high against the euro, relieving downward pressure on prices, while lingering concerns over euro zone debt supported demand for the metal as a haven from risk.
Spot gold  was bid at $1,494.69 an ounce at 0944 GMT, against $1,489.20 late in New York on Monday. U.S. gold futures for June delivery  rose $3.50 an ounce to $1,494.10.

20110518 0939 Soy Oil & Palm Oil Related News.

Soy Oil chart reading : correction range bound downside biased.

Soybeans (Source: CME)
US soybean futures finish higher, finding strength after trading in both positive and negative territory. The market bounced in unison with neighboring grains, buoyed by reminders of tight supply particularly in the face of a lagging planting pace in the eastern Midwest, analysts say. Futures bounced higher later in the day, with the trimming of losses in crude oil, soaring grain prices and the inability of soybeans to attract sellers at the bottom of a recent trading range uncovering fresh speculative buying, analysts said. CBOT July soy ends up 1.1% at $13.41 a bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures ended higher, retracing earlier losses in unison with soybean futures. Soyoil was also influenced by the volatile movements in energy futures, in step with crude oil's midday drop and rebounding once crude began to trim its declines, analysts said. CBOT July soyoil ended 0.2% higher at 56.04c/pound; July soymeal ends 1.4% higher at $350.40/Short Ton.

Australia 2011 canola crop set to be largest in 12 yrs -industry
SYDNEY, May 17 (Reuters) - Australia, the world's third-largest canola exporter, is on track to reap its largest crop of the oilseed in 12 years due to favourable seeding conditions in eastern Australia, an industry official said on Tuesday.
A 2.4 million tonnes crop of the oilseed, also known as rapeseed, was likely to reaped later in the year, Australian Oilseeds Federation (AOF) executive director Nick Goddard said in a statement.

Brazil soy harvest draws to close -Celeres
SAO PAULO, May 16 (Reuters) - Harvesting of Brazil's record 72.55-million-tonne soybean crop has essentially come to an end for the season with the help of dry weather across the grain belt, analysts Celeres said on Monday.
In its latest weekly report, Celeres said that 99 percent of the new crop has been gathered, up from 97 percent the week prior. By this time a year ago, harvested had ended.

Argentine 2010/11 soy crop 82 pct harvested-gov't
BUENOS AIRES, May 16 (Reuters) - Dry weather helped Argentine farmers advance quickly last week in bringing in the country's 2010/11 soy crop, the government said in its latest  weekly report.
As of Thursday, 82 percent of the 18.7 million hectares of Argentine farmland planted with soy had been harvested, up 8 percentage points compared to the week before, the report said.