Friday, May 20, 2011

20110520 1840 Breaking News.

Indonesia official announced to keep palm oil tax unchanged at 17.5% for the month of June 2011.

20110520 1827 FCPO EOD Daily Chart Study.

FCPO closed : 3390, changed : +30 points, volume : higher.
Bollinger band reading : little upside biased.
MACD Histrogram : rising, buyer taking position.
Support : 3350, 3300, 3270, 3250 level.
Resistance : 3420, 3450, 3470, 3500 level.
Comment :
FCPO closed recorded gains with better volume participation while soy oil overnight closed firmer and currently trading higher.
Higher export data released by both ITS and SGS cargo surveyor reaffirmed market than improving demand for palm oil is on track.
Daily chart formed an up doji bar candle position closing upper Bollinger band level after market opened little higher, tested lower below support level and edge up higher before eased little softer to closed off the high of the day.
Chart reading suggesting little upside biased market development with possibly having downward pullback correction.
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.

20110520 1720 FKLI EOD Daily Chart Study.

FKLI closed : 1537 changed : -2 points, volume : lower.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : turned downwards, buyer taking profit.
Support : 1530, 1515, 1500, 1485  level.
Resistance : 1540, 1550, 1565, 1580 level.
Comment :
7 points range market FKLI closed recorded small loss with quiet volume participation doing 4 points discount compare to cash market that also closed recorded small loss while regional markets having mixed development and overnight U.S. market continue to closed firmer after weekly jobless claim improved better than forecast.
Daily chart formed a down bar candle position near upper Bollinger band level after market opened little higher, traded range bound and closed near the low of the day.
Chart reading suggesting a side way range bound little upside biased 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.

20110520 1453 Global Market & Commodities Related News.

Weak dollar stokes equity gains, outlook wary
HONG KONG, May 20 (Reuters) - The dollar looked set to post its first weekly loss in three weeks as investors increased bets on risky assets like equities on expectations the United States would take a long time to raise interest rates after posting weak economic data.  While equities and the euro posted small gains on Friday, commodity markets were still finding their feet after sharp drops this month with disappointing U.S. data weighing on sentiment.

US corn up on exports, wheat headed for biggest weekly gain
SINGAPORE, May 20 (Reuters) - Chicago corn rose around half a percent on Friday, trading close to a three-week top as strong U.S. exports supported the market, while wheat dipped for a second day after climbing to a three-month high in the previous session.  "We did see demand return quite significantly as U.S. export
sales were particularly strong and what that signals to us is that significant pent up demand remains in the global feed grain market," said Luke Mathews, an agricultural commodities strategist at Commonwealth Bank of Australia.

Vietnam rice exports rise 20.6 pct in year to date
HANOI, May 20 (Reuters) - Vietnam's rice exports so far this year have reached 2.87 million tonnes, a rise of 20.6 percent from a year ago, the Vietnam Food Association said.
That reflects deals Vietnam signed earlier this year with the Philippines, Indonesia and several African countries. However, rice prices in Vietnam and elsewhere in Asia may ease in coming weeks as demand has now slowed and supply is rising.

Argentine soy yields low as harvest nears end
BUENOS AIRES, May 19 (Reuters) - Argentine farmers made good progress to bring in 2010/11 soybeans over the last week, but yields were unexpectedly low, the Buenos Aires Grains Exchange said on Thursday.
Dry, hot weather in March affected soy crops in the South American country, the world's top supplier of soyoil and soymeal, hampering the development of late-planted beans.

Argentina holds corn, soy output forecasts
BUENOS AIRES, May 19 (Reuters) - Argentina's 2010/11 soy harvest is expected to come in at 50.4 million tonnes, the government said on Thursday, holding its previous estimate as harvesting nears its end.
Argentina, the world's No. 3 soybean supplier and the leading exporter of soyoil and soymeal, produced a record 52.7 million tonnes in the previous campaign. Dry weather this season trimmed initial expectations for another record harvest.

Brazil begins harvesting high-quality coffee crop
BRASILIA/SAO PAULO, May 19 (Reuters) - Brazil's coffee pickers are heading back to the fields to gather the world's largest coffee crop now turning ripe and showing high quality, signaling relief for a coffee trade juggling low stocks.
Agronomists and traders at three cooperatives and one broker contacted by Reuters were much more optimistic about the crop's prospects than at the outset of the previous two crops, dogged by weather-related quality problems early on.

Oil recovers close to $99 as Thursday's dip lures buyers
SINGAPORE, May 20 (Reuters) - Oil prices recovered as traders saw the previous session's dip as an opportunity to snap up cargoes amid expectations that concerns over supply disruption from the Middle East would continue to support the market.
"Traders are seeing yesterday's slide as a buying opportunity," Victor Shum, an analyst at Purvin & Gertz, said in Singapore. "We are not likely to see an aggressive exit by participants from oil as there is no sign of a quick resolution to the geopolitical

Gold regains strength on bargain hunting,silver steadies
SINGAPORE, May 20 (Reuters) - Gold bounced as bargain hunters resurfaced after prices slipped in the previous session, while silver could be struggling to sustain early gains following a drop in exchange-traded fund
"The long-term uptrend for gold is still intact. If gold moves above the  resistance of $1,500, then I think it could go higher. As the commodity markets start to stabilise, investment demand for silver could return. It has a strong positive correlation to gold and is a cheaper alternative," said Ong Yi Ling, investment analyst at Phillip Futures in Singapore.

China's Q1 gold output up 4.6 pct y/y at 73.412 T - ministry
BEIJING, May 20 (Reuters) - China's gold output in the first three months of 2011 totalled 73.412 tonnes, up 4.63 pct from the same months of 2010, the Ministry of Industry and Information Technology said on Friday.
It said gold mining output was 60.262 tonnes, up 5.18 percent, while another 13.15 tonnes was obtained from smelting base metals, up 2.21 percent from a year earlier.

Copper ticks up after selloff on bearish U.S. data
SINGAPORE, May 20 (Reuters) - London copper rose around half  a percent regaining some ground after losses in the  previous session triggered by another round of weak data that suggested the U.S. economic recovery could be stalling. "The concentrates market is tight but it is focusing purely on the surplus for the time being and the fact that China is not consuming that much," said Jonathan Barrat, managing director of Commodity Broking Services."Remember we are still not getting growth out of the United States."

20110520 1237 Global Market & Commodities Related News.

GLOBAL MARKETS: Weak U.S. data hurts oil, dollar
NEW YORK, May 19 (Reuters) - Discouraging U.S. housing and factory data weighed on oil prices and the U.S. dollar on Thursday, while a lackluster day on Wall Street was overshadowed by the doubling of professional networking company LinkedIn's share price in its market debut.
"The markets right now are very concerned, they are pricing in risk that somehow the second-half rebound is under threat," said Anthony Chan, chief economist at J.P. Morgan Private Wealth Management in New York.

OIL: Crude edges higher ahead of contract's expiry
TOKYO, May 20 (Reuters) - U.S. crude futures rose on Friday ahead of the lead contract's expiry, paring a near 2 percent decline the previous day when weak U.S. economic data stoked worries about demand.
U.S. data showed weekly jobless benefit filings fell last week, yet claims remained above 400,000 for the sixth straight week, while sales of previously owned U.S. homes fell in April.

NATURAL GAS: Natural gas ends below chart support, EIAs bearish
NEW YORK, May 19 (Reuters) - Front-month U.S. natural gas futures ended sharply lower on Thursday, with the front month finishing below key support after a government report showed a weekly inventory build slightly above market expectations.
"The number (EIA build) was close to expectations, but it was the first build above 90 bcf, and next week, we could see a 100-bcf injection, which would not be bullish," a Houston-based analyst said.

EUROCOAL: July ARA bids rise by $2/T to nearly $122
LONDON, May 18 (Reuters) - Prompt European coal prices rose by around $2.00 a tonne on Wednesday in line with oil's gains.
"Oil firmed a little and that's given the market some direction but there are still few bids and offers and few trades to show where current value lies," one trader said.

COMMODITIES: Ends down after one-day rally; oil off 1.7 pct
NEW YORK, May 19 (Reuters) - Commodities fell back on Thursday, a day after posting the biggest gains since March, as economic worries weighed on oil prices and profit-taking snapped a sharp rally in grains.
"We have to suspect that yesterday's move was nothing more than a gigantic technical 'relief rally' in what is still a down market in most commodities," said Edward Meir, energy and metals analyst at MF Global in New York.

20110520 1200 Global Economic Related News.

Singapore: Raises 2011 growth forecast
Singapore raised its growth forecast for 2011 after the island’s economy expanded the most in South East Asia last quarter, sustaining pressure on the central bank to allow the currency to appreciate. GDP will increase 5% to 7% this year, from an earlier forecast of 4% to 6%, the trade minister said. The economy expanded 22.5% in the three months through March from the previous quarter, compared with a preliminary estimate of 23.5%. Singapore’s expansion has fueled a surge in the cost of living that helped propel opposition parties to a record share of the vote in this month’s election. The report spurred a third straight day of gains in the local dollar, bringing the advance against its US counterpart to 13% over the past year as policy makers use currency appreciation to temper inflation. (StarBiz)

Taiwan: GDP expands 6.55%, more than initially estimated
Taiwan’s economy grew more than initially estimated in the first quarter fueled by export gains, adding pressure for higher borrowing costs to contain inflation. GDP climbed 6.55% in the three months through March from a year earlier, compared with a revised 7.13% in the fourth quarter, the statistics bureau said. The preliminary estimate last month was 6.19%, following 2010’s expansion of 10.88%. Taiwan’s central bank meets in June to weigh a fifth straight quarterly rate rise to restrain the cost of living, with home prices remaining near record levels. The government predicts the economy will weather currency gains and trade disruption caused by Japan’s earthquake to expand about 5% this year, and expects inflation to more than double from 2010’s pace. (Bloomberg)

Hong Kong: Jobless rate climbs for first time in 11 months
Hong Kong’s unemployment rate rose for the first time in 11 months as job opportunities failed to keep pace with the number of people looking for work. The jobless rate for the three months through April climbed to 3.5% from a 31-month low of 3.4% in the previous period, the government said. The number compared with the 3.3% median estimate of 14 economists in a Bloomberg News survey. Hong Kong’s government last week raised its forecast for economic expansion this year on “robust” domestic demand that drove first-quarter growth to an annual 7.2%. Accelerating inflation and asset market bubbles pose risks to the economy, Financial Secretary John Tsang said. (Bloomberg)

India: Food prices rise at slowest pace since February 2009
India’s food prices rose at the slowest pace since Feb 2009 as food production climbs toward a record, boosting supplies. An index measuring wholesale prices of agricultural products advanced 7.47% in the week ended 7 May from a year earlier, the commerce ministry said. It gained 7.7 in the previous week. Production of food grains from rice to wheat, lentils and corn is estimated to climb 8% to a record 235.88 million metric tons in the year ending June after a normal monsoon last year, Agriculture Minister Sharad Pawar said. (Bloomberg)

Japan:Falls into recession after economy shrinks 3.7% in 1Q
Japan’s economy shrank more than estimated in the 1Q after the 11 Mar earthquake and tsunami disrupted production and prompted consumers to cut back spending, sending the nation to its third recession in a decade. GDP contract an annualized 3.7% in the three months through March, following a revised 3% drop in the previous quarter, the Cabinet Office said. The median forecast of 23 economists surveyed by Bloomberg News for a 1.9% drop. The March disaster hit an economy already weighed down by years of deflation and subdued consumer spending, and slashed profits at companies including Toyota Motor Corp as factories were shut. (Malaysian Reserve)

UK: Retail sales rise more than forecast on warm weather
UK retail sales rose more than economists forecast in April as warm weather and the extra bank holiday for the Royal Wedding boosted consumer spending. Sales including auto fuel climbed 1.1% from March, when they rose a revised 0.3%, the Office for National Statistics said. The increase was the biggest for an April since 2002 and exceeded the 0.8 percent median forecast of 20 economists in a Bloomberg News survey. From a year earlier, sales increased 2.8%. Britons spent more during two consecutive holiday weekends at the end of April to mark Easter and the wedding of Prince William and Kate Middleton. The Bank of England held its key interest rate at a record low this month on concern that an increase in borrowing costs would dent spending and undermine the recovery, minutes of the decision showed. (Bloomberg)

US: Index of leading economic indicators falls 0.3%
The index of US leading indicators fell in April after nine months of gains, depressed by a pickup in jobless claims that reflects temporary setbacks including auto-plant shutdowns. The Conference Board’s gauge of the outlook for the next three to six months decreased 0.3% after a revised 0.7% gain in March, the New Yorkbased group said. Economists forecast a 0.1% increase, according to the median estimate in a Bloomberg News survey. A jump in firings that moved opposite to increased hiring last month indicated unevenness in the labor market. At the same time, Federal Reserve policy makers noted during their April meeting that job prospects “continued to improve gradually” and economic growth will persist at a “moderate pace.” (Bloomberg)

US: Jobless claims fall more than forecast, reversing jump
Fewer Americans than forecast filed applications for unemployment benefits last week, making it more likely that the surge in April was caused by temporary events rather than a deterioration in the labor market. Jobless claims declined by 29,000 to 409,000 in the week ended 14 May, Labor Department figures showed. The median estimate of economists in a Bloomberg News survey called for a drop to 420,000. The numbers of applications were the lowest in a month. (Bloomberg)

U.S: Previously owned home sales unexpectedly fall in April, pointing to an economy that is struggling to regain momentum following the surge in energy costs. Purchases of existing homes decreased 0.8% to a 5.05 million annual pace in April, the National Association of Realtors said. (Source: Bloomberg)

20110520 1144 Malaysia Corporate Related News.

 KLCI chart reading :
little upside biased with possible pullback correction.

Sumitomo, Carlyle eye USD1.6bn RHB stake
Japan’s Sumitomo Mitsui Financial Group and US private equity firm Carlyle are among the leading contenders to place first round bids for a stake in RHB, after bigger rival CIMB said it is not keen to buy the stake. CIMB chief executive Datuk Seri Nazir brushed aside market speculation that Malaysia’s second biggest bank could bid for Abu Dhabi Commercial bBank’s 25% RHB stake, which has a market value of about USD1.6bn. His comments came after sources told Reuters that US private equity firm TPG, which was partnering Carlyle for the bid, pulled out of the auction ahead of first round bids due yesterday. Carlyle is expected to bid for stake and is in discussions with other potential partners.(Financial Daily)

RM6.5bn offer for Selangor water bonds?
The federal government is poised to make a RM6.5bn offer today to buy over the Selangor water debts from bondholders. It is understood that the offer will be made through the federal government and Pengurusan Aset Air (PAAB), the government's water asset management company. The offer is a RM200 million discount to the value of the outstanding water bonds of RM6.7bn. "The federal government is stepping in to buy over the bonds with a slight discount to what the lenders want. The lenders will have to mark the losses in their book," an industry sources told Business Times. Lenders include Maybank Investment Bank and CIMB Group, which hold about RM1bn of the outstanding water bonds. Insurance firms and pension funds hold about RM2bn each while the rest is held by fund managers such as AmInvestment, CIMB Principal, RHB Asset Management and Public Mutual. A source said the government is dealing directly with the lenders and has been in heavy discussions following the recent approval from the Minister of Finance Inc to take over the bonds. (StarBiz)

Star Publications buys Capital FM for RM15m
Star Publications has proposed to acquire a 80% stake in Capital FM SB for RM15m cash. In a filing to Bursa Malaysia Thursday, the group said the acquisition was in line with its business strategy to acquire more media assets to add to its existing portfolio. Currently, the group owns three radio channels -- 98.8, Red FM 104.9 and Suria FM -- via its subsidiaries, Star Rfm SB and Rimakmur SB. (Bernama)

No MyEmail proposal yet from Pos Malaysia
Pos Malaysia has not committed to coming up with its own proposal for MyEmail project, despite Pemandu saying that it is open to new proposals. In an advertorial in mainstream media on 6 May 2011, Minister in the Prime Minister's Department and Performance Management and Delivery Unit (Pemandu) chief executive officer Datuk Seri Idris Jala had welcomed other parties with new proposals to offer the service to apply. The advertorial clarified that MyEmail-type services are not exclusive to Tricubes Bhd, and that government agencies can use other existing vendors, or other vendors in the future that offer similar services. Despite this statement, Pos Malaysia managing director and chief executive officer Datuk Syed Faisal Albar said the group still needs clarification from Pemandu and the Malaysia Administrative Modernisation and Management Planning Unit (Mampu) on the "drive of the project". (StarBiz)

AirAsia Passenger traffic up 19.2% In April 2011
AirAsia Bhd said it carried 1.45m passengers in April 2011, up 19.2% from last year's 1.22m passengers in the same month last year. In a statement Thursday, it said the capacity increased 9.4% to 1.79m from 1.64m previously, while load factor was up seven percentage points to 81% from 74%. On the operations in Thailand, AirAsia said passengers carried in April this year grew 26.1% to 596,877 passengers from 473,240 in the same month last year. The capacity improved 20.5% to 730,800 from 606,240 previously while load factor increased four percentage points to 82% from 78%. Meanwhile, AirAsia's Indonesia recorded 31.3% increase in passenger carried during April this year to 385,739 from 293,742 in the same month last year. Load factor improved five percentage points to 76% from 71% while capacity was up 22.5% to 507,352 from 414,064 previously. (Bernama)

PPB to start bread business in Q3
Expanding on its downstream business, PPB Group will start its own bread business in the 3Q of this year and will leverage on its existing 36,000 retailers to distribute its bread. PPB Group chairman Datuk Oh Siew Nam said there were eventual plans to build more bakeries in other parts of Malaysia, although he cannot ascertain the timing yet. PPB is now in the process of conducting a due dilligence for the acquisition of a 20% stake in select flour mills in China owned by associate company Wilmar International Ltd. As for PPB's Indonesian operations, the group intends to double its milling capacity in Indonesia from 1,000 tonnes to 2,000 tonnes over the next two years. Due to the competitive nature of Indonesia, its market share is still less than 5%. (StarBiz)

PPB: Eyes Indonesia's flour market. PPB Group Bhd is eyeing at least 10% of Indonesias flour market that currently dominated by his former business partner, Salim Groups Liem Sioe Liong. This sets the stage for a professional rivalry between the two powerhouses as both groups allocate more resources to capture a larger slice of the burgeoning consumer business at the populous islands. (Source: The Edge Financial Daily)

UOA: RM10b projects in the pipeline. UOA Development Berhad, which is scheduled to list on the Main Market of Bursa Malaysia on June 8, has property projects worth RM10b in total gross development value (GDV) over the next 10 years. Moving forward, the company plans to retain its focus in the Klang Valley, especially its Bangsar South development poject, before considering other geographical locations. (Source: The Edge Financial Daily)

TDM: To invest RM120m in Indonesia. TDM will inject RM120m into its Indonesian operations at Kalimantan within the next eight to 10 years to build four oil palm mills in the area. They expect to see contributions from the Kalimantan operations by 2013 after they had initially invested RM44m in Kalimantan. (Source: The Edge Financial Daily)

Ramunia, Coastal: Agree to abort MoU. Ramunia Holdings Bhd and Coastal Contracts Bhd have aborted a memorandum of understanding (MoU) for the proposed collaboration, bidding and fabrication in relation to structures for the oil and gas industry. The MoU was entered into between both companies in January 2010, but had lapsed on May 18 this year as both parties have mutually agreed not to proceed with it. (Source: The Edge Financial Daily)

AirAsia: AirAsia X inks USD600m deal to buy General Electric engines. AirAsia X has signed a contract worth RM1.8b with General Electric to purchase jet engines for its new aircraft. Under the agreement, the long-haul low fare affiliate of AirAsia Group will purchase CF6-80E1 engines to power its three new A330-200s (with the option of two additional aircraft). (Source: The Edge Financial Daily)     

20110520 0950 Global Market Related News.

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

Hang Seng chart reading : correction range bound downside biased. 

U.S. Consumer Confidence Declines to Nine-Month Low, Bloomberg Index Shows (Source: Bloomberg)
Consumer confidence fell last week to the lowest level in nine months as the cost of fuel pinched U.S. household budgets. The Bloomberg Consumer Comfort Index declined to minus 49.4 in the period to May 15, the worst reading since August, from the prior week’s minus 46.9. A gauge of personal finances plunged to the weakest level since October 2009, and a monthly measure of economic expectations held at a seven-month low.

U.S. Stocks Advance as Decline in Weekly Jobless Claims Boosts Optimism (Source: Bloomberg)
U.S. stocks advanced, sending the Standard & Poor’s 500 Index higher for a second straight day, as a government report showing a bigger-than-forecast drop in jobless claims bolstered optimism about the economic recovery. LinkedIn Corp., the largest professional-networking website, more than doubled in the first day of trading after its initial public offering. Thermo Fisher Scientific Inc. (TMO) jumped 4.2 percent after agreeing to buy Phadia AB for about $3.5 billion to grow in testing for allergies and autoimmune diseases. Intel Corp. (INTC), KLA-Tencor Corp. (KLAC) and Applied Materials Inc. (AMAT) slumped at least 1.1 percent as Goldman Sachs Group Inc. cut their ratings amid increased competition and excess supply.

Home Sales in U.S. Drop, Manufacturing Stalls in Sign Recovery Is Flagging (Source: Bloomberg)
Sales of existing U.S. homes unexpectedly declined, manufacturing in the Philadelphia region slowed and consumer confidence dropped, pointing to an economy that is struggling to regain momentum following the surge in energy costs.

Most at Fed want rate hikes before asset sales
WASHINGTON, May 18 (Reuters) - Most Federal Reserve officials prefer to raise rock-bottom interest rates before selling assets when the time comes to tighten policy, according to minutes of their April meeting.
The minutes, released on Wednesday, showed worries about inflation rising among Fed officials last month before a big surge in oil prices subsided. At the same time, the minutes stressed the April discussion did not indicate the Fed was ready to start tightening policy any time soon.

Goldman Lowers Dollar Forecasts Versus Euro on Weak U.S. Growth Prospects (Source: Bloomberg)
Goldman Sachs Group Inc. (GS), the U.S. bank that lost money from trading on only one day in the first quarter, cut its dollar forecasts saying growth in the world’s largest economy is lagging behind other nations. The greenback will weaken to $1.45 per euro over three months from an earlier projection of $1.40, analysts led by Thomas Stolper in London wrote in a note to clients yesterday The dollar will decline to $1.50 in six months and $1.55 in a year, the analysts forecast. They also cut their three-month target for the currency to 82 yen from 84 yen.

Fed Nears Accord on How to Exit Record Stimulus With Timing Still Unclear (Source: Bloomberg)
Federal Reserve policy makers neared agreement on the sequence of tools they will use to withdraw record monetary stimulus, with little accord on when to start. The central bank should first end its policy of reinvesting proceeds from maturing securities and later raise interest rates and sell assets, majorities of policy makers said at their April 26-27 meeting, according to minutes released yesterday. The caveat: Talks about the exit strategy don’t mean that tightening “would necessarily begin soon,” the report said.

Quake knocks Japan into recession, late 2011 recovery still eyed
TOKYO, May 19 (Reuters) - Japan's economy shrank much more than expected in the first quarter and slipped into recession after the triple blow of the March earthquake, tsunami and nuclear crisis hit business and consumer spending and tore apart supply chains.
The Bank of Japan (BOJ) expects the economy to resume growing in the second half of the year, but some economists say the surprisingly grim gross domestic product figures in the first quarter increase the risk that the pace of recovery will be slower than anticipated. Manufacturers are moving to repair supply chains, but fears of power shortages in the summer and an ongoing nuclear crisis also pose risks, economists say.

Japan’s Slump Heightens Calls for Faster Stimulus (Source: Bloomberg)
Japanese consumers are making deeper cutbacks after the March 11 earthquake than anticipated, heightening the urgency for policy makers to unveil measures to end the nation’s third recession in a decade.

Yen Declines Versus Euro for Fifth Day (Source: Bloomberg)
The yen dropped against the euro for a fifth day on prospects the Bank of Japan today will reiterate its pledge to maintain monetary stimulus to support an economy in recession after a record earthquake.

S. Korea to Tighten Curbs on Currency Derivatives (Source: Bloomberg)
South Korea said it will tighten limits on the amount of currency derivatives banks can hold as it seeks to curb swings in capital flows and the won. Local branches of overseas banks will be allowed to hold currency derivatives contracts equivalent to no more than 200 percent of equity capital, down from 250 percent, and the cap for domestic banks will be reduced to 40 percent from 50 percent, the finance ministry said in a statement late yesterday.

April Retail Sales Gain More Than Forecast on Warm Weather, Royal Wedding (Source: Bloomberg)
U.K. retail sales rose more than economists forecast in April as warm weather and the extra bank holiday for the Royal Wedding boosted consumer spending. Sales including auto fuel climbed 1.1 percent from March, when they rose a revised 0.3 percent, the Office for National Statistics said today in London. The increase was the biggest for an April since 2002 and exceeded the 0.8 percent median forecast of 20 economists in a Bloomberg News survey. From a year earlier, sales increased 2.8 percent.

European Stocks Climb; BP Gains, Pandora Slumps, Glencore Debuts in London (Source: Bloomberg)
European stocks rose for a second day as industrial stocks led gains on the benchmark Stoxx Europe 600 Index after the U.S. Federal Reserve signaled that interest rates will remain low. Glencore International Plc was unchanged on its first day of trading in London after it sold $10 billion of stock in its initial public offering. BP Plc (BP/) climbed 1.6 percent as BofA Merrill Lynch Global Research advised buying the shares. Pandora A/S, the Danish maker of jewelry, slumped 22 percent after saying it has lifted prices globally for the first time in its history because of the rising cost of silver and gold.

Swiss Investor Sentiment Declines, Credit Suisse Says (Source: Bloomberg)
Swiss investor confidence dropped for the first time in four months in May as a worsening European debt crisis and an appreciating franc clouded the economic growth outlook. An index of investor and analyst expectations that aim to predict economic developments six months in advance fell to minus 11.5 from 8.8 in April, the ZEW Center for European Economic Research in Mannheim, Germany, and Zurich-based Credit Suisse Group AG (CSGN) said in an e-mailed statement today. The survey was conducted May 10-16.

Thai Economic Growth Probably Accelerated (Source: Bloomberg)
Thailand’s economic growth probably quickened last quarter to the fastest pace in a year, sustaining pressure for higher interest rates to contain inflation. Gross domestic product rose 2.2 percent in the three months through March from the previous quarter, when it climbed 1.2 percent, according to the median of 11 estimates in a Bloomberg News survey. The data is due 9:30 a.m. local time on May 23.

New Zealand Budget May Limit RBNZ Rate Rises Through Earthquake Rebuilding (Source: Bloomberg)
New Zealand’s planned spending cuts to achieve a budget surplus in four years may add to the case for interest rates to stay low through rebuilding from the country’s deadliest earthquake in eight decades. Prime Minister John Key announced more than NZ$5 billion ($4.1 billion) in spending cuts and the end of deficits by fiscal 2015 in a budget that predicted inflation will moderate this year and wages will fall in the year ending March 31. He told parliament that lower borrowing costs were a “dividend” of the strategy.

FOREX-Euro edges up, but Greek debt worries limit gains
LONDON, May 19 (Reuters) - The euro edged up in choppy trade on Thursday with traders citing demand from hedge funds and Middle East accounts, though uncertainty about the implications of a possible Greek debt restructuring limited gains. Analysts said investors were looking for opportunities to start buying the euro and riskier currencies after recent falls, but concerns about euro zone debt kept the euro below its 55-day moving average around $1.4297.
Traders pointed to a report that quoted European Central Bank head Jean-Claude Trichet as saying the bank would not accept Greek bonds as collateral should there be a decision to lengthen the term of Greece's debt repayments. The same view was attributed to policymaker Juergen Stark by a bank spokesman.

20110520 0943 Global Commodities Related News.

Corn (Source: CME)
US corn futures finish lower as traders take profits after prices climbed 15% in a week on concerns about threatening weather. "We had a big run up. We've got to take profits some time," says Alan Brugler, president of Brugler Marketing & Management. Prices had climbed as rains delayed planting, raising concerns farmers would not produce as big of a crop as previously expected. Concerns persist, as weather forecasts call for conditions to remain wet in the Midwest. CBOT July corn slips 1 1/2c to $7.48 1/4 a bushel.

Wheat (Source: CME)
US wheat futures finish mostly higher on concerns about poor weather threatening output. Rains are delaying planting of spring wheat in the northern US Plains and drought is reducing the winter-wheat harvest in the southern Plains. Supplies of high-protein hard red spring wheat, grown in North Dakota and Minnesota, are tight as buyers search for quality grain, traders say. France and Germany also struggle with dryness, adding to supply concerns. CBOT July wheat falls 5c to $8.12 a bushel; KCBT July jumps 6 3/4c to $9.44 3/4; MGEX July rises 10c to $10.06 1/4.

Rice (Source: CME)
US rice futures end stronger on solid foreign demand for the crop. Export sales of 48,800 tons for delivery before July 31 were up 2% from the previous week, according to the UDSA. Top buyers included Haiti, which booked 14,100 tons, and Mexico, which took 12,400 tons. CBOT July rice rises 12 1/2c to $15.01 1/2 per hundredweight.

OTC commodity positions up 2 pct in H2 2010-BIS
LONDON, May 18 (Reuters) - The value of over-the-counter commodity derivative positions rose by 2 percent in the second half of 2010, driven by a jump in forwards and swaps activity, the Bank for International Settlements said on Wednesday.
Global regulators are attempting to make the OTC derivatives markets more transparent amid criticism that speculation in commodities has fuelled food inflation and high gasoline prices.

Commods likely to recover after short correction-MF Global
SINGAPORE, May 18 (Reuters) - Commodity prices are likely to fall further in the next month or two before rebounding towards the end of the year as demand continues to grow, prompting MF Global  to expand its presence in the sector, a senior company executive said.
Brokerage MF Global Holdings, with a market value of $1.4 billion, maintained its long-term bullish outlook for commodities and expected prices to rise 10-20 percent over the next 12 months from current levels due to a weaker dollar, rising global demand and gradual inventory tightening.

Singapore's Wilmar To Invest CNY300 Mln In China Grain Processing (Source: CME)
Yihai Kerry Group, the China arm of Singapore agribusiness giant Wilmar International Ltd., plans to invest CNY300 million ($46 million) in grain processing facilities in China's southern province of Yunnan, Wilmar and a state-backed Chinese grain agency said separately. The expansion in Yunnan by Yihai Kerry, already a major producer of processed food-grain products in China, is planned despite pressure on profitability from price controls the government has been relying on to contain inflation. The planned facilities, to be located in the province's Jinning county, will include logistics and distribution sites, and processing facilities for grain, potato and walnut products, the China National Grains & Oils Information Center said. Wilmar set up the Yunnan subsidiary, Yihai Kerry (Kunming) Foodstuffs Industries Co. Ltd., in December, and construction on the plant will start soon, a Wilmar spokesman said.
The subsidiary is 70% owned by Yihai Kerry Investments Co. Ltd., the parent company said in a statement. Yihai Kerry's sales in Yunnan of 650,000 metric tons a year are valued at more than CNY3 billion, the CNGOIC said. The Singapore company's advance in China comes despite pressure from the government's price controls on food products. Beijing has asked the company, along with other large domestic producers, to cap prices of cooking oils as part of the government's efforts to contain inflation. Last week, Wilmar, the world's largest palm oil producer, said its net profit in the January-March quarter fell to $386.7 million from $401.4 million in last year's first quarter. The company attributed the decline partly to narrower profit margins for consumer products, as "government regulations in some countries" prevented it from raising prices in response to higher raw material costs. It also attributed the dip, which wasn't as sharp as expected, to fair-value losses.
"The Group remains positive on its prospects, despite a challenging operating environment in China arising from the monetary tightening and anti-inflationary measures implemented by the Chinese government," said Kuok Khoon Hong, Wilmar's chairman and chief executive. Grain processing in China has traditionally been dominated by local companies such as Cofco Ltd. Yihai Kerry's foray into the wheat-processing sector is only about five years old.

Zambia Sees 1.7M Tons Of Surplus Corn After Bumper Harvest-President (Source: CME)
Zambia has at least 1.7 million metric tons of surplus corn following a bumper harvest in the mineral-rich southern African country, the Zambian presidency said. Zambia's 2010-11 (May-April) corn output increased by at least 8% to hit a historic record three million metric tons, aided by government farmer support programs, the country's agriculture minister announced. "Our farmers are the cornerstone of Zambia's economy. You are the ones who are helping build a future of food security, stability and economic growth, free from poverty," a presidential spokesman was quoted as saying.

Mexico Corn Production To Reach 25 Mln Tons In 2012 - Official (Source: CME)
Mexico's corn production is expected to reach 25 million metric tons in 2012 and continue increasing steadily in the long term, officials with the Agriculture Ministry said. "Mexico will continue being the biggest worldwide producer of [white] corn," Ernesto Fernandez-Arias, deputy minister of the ministry's agricultural aid unit, said at a press conference. Of the total estimated corn output for next year, 23 million tons will be white corn and 2 million tons will be yellow corn, according to the ministry. Land cultivated with corn is expected to increase to 8 million hectares as high international prices motivate farmers to plant more. By 2014, Mexico will be producing about 27 million tons, officials say. Earlier this year, freezes caused almost complete losses in the white corn production of Sinaloa, a northern Mexico state. The government immediately launched replanting efforts, and about 2 million tons of the state's total 4 million tons were recuperated.
Officials have said Mexico will produce 23.3 million tons of corn this year, down from last year because of the freezes. The ministry initially forecasted a record 25 million ton harvest for this season. An official with the U.S. Department of Agriculture who spoke at the event was less optimistic about the long-term prospects, saying she expects it will take 10 years for Mexico's corn production to reach 27 million tons. Mexico's yields are expected to rise to 3.7 tons per hectare from 3 tons per hectare between this year and 2020, said Sally Thompson, director of the market and trade economics division for the U.S. Department of Agriculture. "We predict higher yields will support an expansion in production," she said. According to Agriculture Minister Francisco Mayorga, the country's increased corn production is part of a national effort to become more self-sufficient. "One of the biggest challenges of humanity is to produce a sufficient amount of food," he said.
Mexico produces mostly white corn, which is used for human consumption. Its yellow corn output is used mostly to feed livestock because Mexicans consider the yellow grain to be too sweet.

Rabobank: World '11-12 Wheat Output +10 Mln Tons At 657.6 Mln Tons (Source: CME)
World wheat output is forecast to rise 10 million metric tons to 657.6 million tons next season, Rabobank said, but it warned that severe drought in Europe and wetness in the U.S. could cut that figure further. Giving its first forecasts for the 2011-12 crop year, the bank said the global markets face a production deficit for a third consecutive season, meaning stocks will be drawn down to 167.5 million tons by the end of the season. Prices, as measured on the Chicago Board of Trade, are expected to stay around $7.90 a bushel in the second quarter of 2011, rising to $8/bushel in the third, but falling back to $7.50/bushel by the end of the year. "Prices [are] expected to remain elevated but showing a very different trend to the rally seen in 2010," said the report. Wheat prices in Chicago surged more than 60% from around $6.00 a bushel in the summer of 2010 to peaks of nearly $10 a bushel in February 2011.
The estimate paints a more bullish picture than the U.S. Department of Agriculture's forecasts last week, which pegged production at 669 million tons next crop year--the third largest on record--leaving a marginal net deficit of only 1 million tons for the season. Rabobank said it expects further downgrades from the USDA this season as excessive moisture in the Northern plains of the U.S. and Canada limit plantings and the worst crop ratings for 15 years boost abandonment rates. "Based on current crop conditions, the USDA's forecast for a 21 million ton year-on-year increase in world wheat production is in our view too high," said Rabobank. Wheat prices soared by more than 4% in Paris and 5% in the U.S. Wednesday as the worst drought to hit Europe in decades dimmed hopes for a rebound in output in the world's largest grain-producing region next season.

Corn Prices Could Rise 35%, Wheat 25% In 2011-12 -Renaissance Capital (Source: CME)
World grain prices could rise up to 35% from already historically-high levels in 2011-12 if a rebound in global production comes in line with recent decades, said a report from Renaissance Capital. Analyst Charles Robertson said growing demand, especially for corn, is likely to eat into already-low world stocks even without a feared cut to yields from poor weather. "We can easily imagine a 35% rise in corn prices and a 25% rise in wheat prices from August 2011 to July 2012," said the report. "The food-price threat for 2011-2012 is very significant, but may disappear in August." Grain prices have surged in recent weeks, with corn hitting a record high last month, as weather problems in the U.S. and the most severe European drought in decades sparked fears of poor crops from the world's top exporters. Markets are jittery after a succession of natural disasters in 2010 sapped output and left users eating into stock levels.
Corn inventories in particular are now near historically-low levels and forecasters fear even a record world crop wouldn't be enough to replenish supplies. Using a range of models based on historical supply responses, Robertson predicts corn output is most likely to rise by about 15 million metric tons in 2011-12 to 840 million tons, drawing stocks down to a mere 6.3 weeks of consumption. "The global corn harvest may well fail to match demand, even if there is no severe drought in the EU, China or the U.S., suggesting stocks could fall further in 2011-2012," he said. In wheat, an average scenario would see output rise by 2.5 million tons to 650 million tons, leaving stocks flat and boosting prices by 10%. In a more negative scenario, output would fall and stocks would decline to 148 million tons, pushing up prices 30%.

Sugar Price May Extend Gain as Brazil Output Slows, Survey Shows (Source: Bloomberg)
Sugar may rise next week on signs that output is dropping in Brazil, the world’s biggest grower. Seven of 11 traders, analysts and brokers surveyed by Bloomberg News said that raw sugar traded in New York probably will advance. Two forecast a loss, and two said prices would be little changed. Before today, futures for July delivery gained 1.7 percent this week, closing yesterday at 21.82 cents a pound.

Oil Climbs in New York Trading as Investors Bet U.S. Jobs Support Demand (Source: Bloomberg)
Oil rose in New York as investors speculated a decline yesterday was too much and that a bigger- than-forecast drop in jobless claims signals fuel demand may increase in the world’s biggest crude-consuming nation.

China may cut tax rebates on aluminium profile exports-sources
HONG KONG, May 19 (Reuters) - China may cut tax rebates on exports of aluminium profiles to 9 percent in June or July but leave the rebate unchanged on plate aluminium, the most active semi-finished aluminium product export, industry sources said on Thursday.
Exports of aluminium profiles, used in the construction sector, and plate, used in the manufacture of industrial products, are currently subject to a 13 percent tax rebate.

RUSAL may cut aluminium output by 0.5 pct in '11
MOSCOW, May 19 (Reuters) - The world's top aluminium producer, Russia's UC RUSAL , said on Thursday it might cut its 2011 metal output forecast by less than 0.5 percent this year due to supply problems at two Siberian smelters.
"In connection with the collapse of the railway bridge over the Abakan River in Khakas region that was used to deliver... raw materials to Sayanogorsk and Khakas aluminium smelters, the company decided to reduce production at both smelters," it said in a statement.

Copper market surplus 118,000 T in 1st qtr-WBMS
LONDON, May 18 (Reuters) - The global copper market recorded an 118,000 tonne surplus in the first three months of this year, compared with a 43,000 tonne surplus for the whole of last year, the World Bureau of Metals Statistics said on Wednesday.
Refined copper production in the first three months rose to 4.76 million tonnes, up 1.8 percent compared with the same period last year. World mine production in January to March was 3.89 million tonnes, up 3.4 percent from the previous year.

Japan April copper cable shipments down 1.4 pct yr/yr
TOKYO, March 23 (Reuters) - Japanese copper wire and cable shipments fell 1.4 percent from a year earlier in April as strong demand for temporary housing partially offset a plunge in auto demand after a devastating earthquake on March 11. 
April shipments totalled an estimated 55,400 tonnes, down from revised March shipments of 56,207 tonnes, data from the Japanese Electric Wire and Cable Makers' Association showed on Thursday.

China warns importers about low-quality Indian iron ore
BEIJING, May 19 (Reuters) - Chinese importers need to pay more attention to the quality of Indian iron ore after an inspection revealed that more than a third of deliveries to a key eastern province were substandard, the country's quality watchdog said on Thursday.
The General Administration of Quality, Supervision, Inspection and Quarantine (AQSIQ) said 36.13 percent of Indian ore shipments delivered to Jiangsu province in the first four months of the year did not make the required grade.

S.Korea buys 1,000 T zinc; seeks 3,000 T aluminium
May 19 (Reuters) - South Korea has bought 1,000 tonnes of zinc ingots for shipment by July 15 to the port of Incheon via a tender closed on May 12, state-run Public Procurement Service said.
The government's procurement agency bought it from a domestic zinc refiner Young Poong Corp  at a premium of $105 per tonne over London Metal Exchange (LME) cash prices on a cost, insurance and freight (CIF) basis, the agency said late on Wednesday on its website (

Kazakhstan's Q1 uranium output up 9 pct yr/yr
ALMATY, May 19 (Reuters) - Kazakhstan, the world's largest uranium producer, boosted its output of the metal by 9 percent in year-on-year terms in the first quarter of 2011 to 4,444 tonnes, state nuclear firm Kazatomprom said on Thursday.
Kazatomprom's share in the nation's output amounted to 2,543 tonnes in the first three months of this year.

METALS-Copper falls on dollar, ahead of jobs data
LONDON, May 19 (Reuters) - Copper fell on Thursday in cautious trade ahead of U.S. jobless claims and as a firmer dollar ate into gains made in the previous session, when it rose the most in two months in a commodity-wide rebound. Three-month copper on the London Metal Exchange  was off $15 at $9,050 a tonne by 0959 GMT. It rose more than $260, or over 3 percent on Wednesday, its biggest rise since March 17.
"We had a strong bounce yesterday, which means it's going to be a bit cautious now. You can't just dismiss the correction at the beginning of this month as simply a blip," said BNP Paribas senior metals market strategist Stephen Briggs.

PRECIOUS-Gold cuts losses as dollar dips, oil rallies
LONDON, May 19 (Reuters) - Gold pared some losses on Thursday as the euro edged up against the dollar and oil prices firmed but prices were still set for a daily decline as investors took their cue from currency markets. Spot gold  was bid at $1,494.69 an ounce at 1105 GMT, against $1,496.30 late in New York on Wednesday. U.S. gold futures for June delivery  fell $2.4 to $1,493.5.
An early bounce in the euro  helped gold to a session high near $1,500, with investors wary towards the dollar after minutes of a Federal Reserve meeting in April did not indicate the Fed was ready to start tightening policy any time soon.

20110520 0941 Soy Oil & Palm Oil Related News.

  Soy Oil chart reading : correction range bound little downside biased.

ITS CPO export up 29.7% to 794,322 tonnes for the period of 1~20 May 2011.
SGS CPO export up 28.3% to 819,257 tonnes for the period of 1~20 May 2011.

Soybeans (Source: CME)
US soybean futures finish little changed as market participants face uncertain demand. The USDA said private exporters struck deals to sell 110,000 tons of soybeans to China, the world's top importer of the oilseed, for delivery after Aug. 31. The purchases followed a period of slow demand from China, which shifted its business to South America. China may now be returning its business to the US, says Alan Bugler of Bugler Marketing & Management. Yet, US soy export sales for last week were low. CBOT July soybeans close flat at $13.79 1/2 a bushel.

Soybean Meal/Oil (Source: CME)
US soy-product futures finish slightly higher, extending recent gains on supply concerns. Soymeal reached its highest price since April 1 before the July contract trimmed gains to close up 40c at $361.40/short ton. The market has climbed 6% the past week. Soyoil touched a 2 1/2-week high, closing up 0.16c at 57.46c/pound.

May 19 (Bloomberg) -- India, the world’s biggest user of cooking oil after China, will ensure higher oilseed prices for farmers, helping them boost output of soybeans and peanuts and potentially reducing imports of palm oil.