Wednesday, May 25, 2011

20110525 1810 FCPO EOD Daily Chart Study.

FCPO closed : 3416, changed : +36 points, volume : higher.
Bollinger band reading : upside biased.
MACD Histrogram : rising, buyer in control.
Support : 3420, 3350, 3300, 3270, 3250 level.
Resistance : 3450, 3470, 3500, 3550 level.
Comment :
FCPO closed recorded gains with higher volume exchanged after both ITS and SGS cargo surveyor released higher export data while soy oil overnight closed little higher and currently trading firmer.
Daily chart formed an up doji bar candle closed near upper Bollinger band level after market opened little lower, tested near lower support level and pushed upwards toward the end to closed near the high of the day.
Technical chart reading turned to suggesting a upside biased market development development possible testing higher resistance level.
When to buy : buy at support or weakness with larger cut loss and profit target or buy at break up with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110525 1742 FKLI EOD Daily Chart Study.

FKLI closed : 1531.5 changed : +6.5 points, volume : higher.
Bollinger band reading : side way range bound.
MACD Histrogram : turned upward, buyer reducing position.
Support : 1530, 1515, 1500, 1485 level.
Resistance : 1540, 1550, 1565, 1580 level.
Comment :
FKLI closed recorded gains with higher volume participation doing 2 points discount compare to cash market that closed recorded small gain while regional(Asia & European) trading mostly lower and overnight U.S. market closed little lower.
Daily chart formed an up bar candle closed above middle Bollinger band level after market opened softer, tested little lower and edge up higher traded ranged bound before closed near the high of the day.
Chart reading remained 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.

20110525 1617 Global Market & Commodities Related News.

Fed officials see recovery firm despite gas costs
CAPE GIRARDEAU, Mo., May 24 (Reuters) -  Federal Reserve officials on Tuesday expressed confidence in the U.S. economic recovery despite high gas prices and European financial jitters, and one suggested the U.S. central bank could reverse its ultra-loose monetary policy this year.
"I do believe we're in a sustainable economic recovery. We face some risks, but we always face some risks," James Bullard, president of the St. Louis Fed, told reporters after a speech to a Rotary Club group.

Oil off highs, euro slips on euro zone debt fears
SINGAPORE, May 25 (Reuters) - The euro slipped back towards a two-month low and oil prices fell as a rally the previous day fizzled on fears about Europe's spreading debt crisis and the potential for a further reduction of positions in risky assets. "Concern about Spain and Italy might be overblown, but the Greece issue is not going away, and if Greece restructures, that may open the door for Ireland and Portugal." said Brian   Dolan, chief strategist at

Oil World cuts Argentine soybean crop forecast
HAMBURG, May 24 (Reuters) - Hamburg-based oilseeds analyst Oil World on Tuesday cut its forecasts of Argentina's 2011 soybean crop by 0.3 million tonnes as it said harvest yields were poorer than expected after unfavourable weather.
Oil World now forecasts Argentina's 2011 soybean crop at 49.2 million tonnes, down from 53.9 million tonnes harvested last year.

Corn falls 3 pct, biggest drop in nearly two-weeks
CHICAGO, May 24 (Reuters) - U.S. corn futures fell 3 percent on Tuesday for the biggest one-day drop in nearly two weeks as investors took profits and cut risk premiums as seeding of the crop was on the home stretch.
"I don't know any other reason than fund selling, I didn't hear of anything else that might have done this," said Mario Balletto, an analyst for Citigroup.

Government to finance Brazil cane replanting
SAO PAULO, May 24 (Reuters) - Brazil's government will offer a line of subsidized credit for the replanting of cane crops, as part of a larger push to stimulate production of ethanol, the Agriculture Ministry said on Tuesday.
The new line of credit, directed at improving sugar cane yields through replanting of less productive fields, will be part of a low-carbon program with interest rates of 5.5 percent annually, below the 6.75 percent offer in other rural credit programs.

Rains urgently needed for much West European wheat
LONDON, May 24 (Reuters) - Wheat crops in much of western Europe remain in urgent need of more rain with time beginning to run out for some, particularly those on lighter soils, analysts and industry sources said on Tuesday.
"With every day that passes, the potential for recovery is dwindling," Jack Watts, senior economist with the Home-Grown Cereals Authority, said referring to the UK crop.

More severe storms, big rains head to US Corn Belt
CHICAGO, May 24 (Reuters) - More severe storms head to the U.S. Midwest this week, bringing heavy rains to soaked lands in the eastern belt where farmers are already struggling to finish corn planting by month's end, a forecaster said on Tuesday.
"With the rains coming, they are not going to see a whole lot of progress this week. It dries out later -- but by then it will be early June," said Joel Burgio, Telvent DTN forecaster.

Iraq sees higher wheat harvest, to suspend imports
BAGHDAD, May 24 (Reuters) - Iraq expects its wheat harvest to increase to between 2 million and 2.5 million tonnes this year, the agriculture minister said on Tuesday, up from 1.866 million tonnes in the 2009/2010 season when rains were good.
"We expect wheat to be above two million tonnes," Izzedine al-Dawla told reporters.

Government to finance Brazil cane replanting-paper
SAO PAULO, May 24 (Reuters) - The Brazilian government plans to offer a line of subsidized credit to sugar and ethanol mills for the replanting of cane crops, as part of a larger push to stimulate production of the biofuel, agriculture minister Wagner Rossi told a local newspaper.
Rossi said in Tuesday's Valor Economico paper that the new line of credit would be in the annual farm budget and directed at improving sugar cane yields through replanting of less productive fields.

S.Africa raises 2010/11 maize output f'cast
JOHANNESBURG, May 24 (Reuters) - South Africa raised its May 2010-April 2011 maize output forecast on Tuesday, beating market expectations, after an increase in white maize yields in some parts of the country.
The government Crop Estimates Committee (CEC) said the country is now expected to harvest 10.99 million tonnes of maize, compared with 10.883 million tonnes in its previous forecast.

Brazil coffee farm will irrigate to boost output
BRASILIA, May 24 (Reuters) - Brazil's biggest coffee farm, Ipanema Coffees, hopes to boost yields by as much as a third through use of irrigation, part of an investment trend among producers eager to cash in on a sharp rise in prices.
Washington Rodrigues, CEO at Ipanema Coffees in the southeastern coffee belt in Minas Gerais state, said factors such as land prices in the dense farming region and surging labor costs made yields the most viable way to raise output.

World craves ever more coffee despite soaring price
LONDON, May 24 (Reuters) - Global demand for coffee is set to keep climbing and even a doubling in the cost of the commodity over the last 12 months has failed to quench consumers' thirst for the beverage.
Faster paced lifestyles in China and other Asian economies where economic growth has been strong have helped to keep consumption of coffee firmly on an upward path.

Brent falls below $112 on small U.S. crude draw, firm dollar
SINGAPORE, May 25 (Reuters) - Brent crude futures slipped below $112 a barrel after industry data showed U.S. crude inventories fell less than forecast last week and as the dollar rebounded against the euro.   "The inventory numbers are driving prices lower. The rise in gasoline stocks is significant coming just before Memorial Day," said Michel Lo, a Hong Kong-based analyst with Nomura International. "If the EIA numbers show a rise as well that will put more pressure on prices."

Venezuela March oil output up at 2.8 mln bpd
CARACAS, May 24 (Reuters) - Venezuela produced 2.8 million barrels per day of oil in March, up from 2.7 million bpd in February, the oil ministry said Tuesday.
South America's biggest crude producer said in late March it was no longer publishing oil export and production data certified by an independent auditor, adding to skepticism over the country's assessment of its oil sector.

Oil World cuts Argentine soybean crop forecast
HAMBURG, May 24 (Reuters) - Hamburg-based oilseeds analyst Oil World on Tuesday cut its forecasts of Argentina's 2011 soybean crop by 0.3 million tonnes as it said harvest yields were poorer than expected after unfavourable weather.
Oil World now forecasts Argentina's 2011 soybean crop at 49.2 million tonnes, down from 53.9 million tonnes harvested last year.

Gold off 3-week high, euro-priced bullion hits record
SINGAPORE, May 25 (Reuters) - Gold inched down, having rallied to its highest level in three weeks in the previous session, but bullion priced in euro struck a record on concerns about the impact of a possible debt default by Greece on other euro zone economies.  "Overall sentiment for the long-term is still bullish. But I think for the short-term, we'll start to see resistance at $1,530 after rising from the downside of $1,470-$1,480 up to this level," said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.

20110525 1237 Global Market & Commodities Related News.

GLOBAL MARKETS: Oil off highs, euro slips on euro zone debt fears
SINGAPORE, May 25 (Reuters) - The euro and oil prices slipped on Wednesday as a rally the previous day fizzled on nagging fears about Europe's spreading debt crisis and the potential for a further reduction of positions in risky assets.
The euro was down 0.3 percent after it recovered from a two-month low hit on Monday on a strong recovery in oil prices and better-than-expected German business confidence data.

OIL: Oil rises 2 pct as Goldman boosts price forecast
NEW YORK, May 24 (Reuters) - Oil rose 2 percent on Tuesday in choppy trading after Goldman Sachs raised its price forecasts for Brent crude, saying demand from economic growth will eat into stockpiles and OPEC spare capacity.
"Data showing U.S. home sales rose in April was supportive to the market, in addition to the buying encouragement prompted by the Goldman Sachs forecast for higher Brent crude prices," said Joe Posillico, broker at MF Global in New York.

Japan April crude oil import volume down 14.0 pct
TOKYO, May 25 (Reuters) - The volume of Japan's customs-cleared crude oil imports fell 14.0 percent in April from the same month a year earlier, the Ministry of Finance said on Wednesday.
Economic activity in Japan has been hurt by a magnitude 9.0 quake and tsunami on March 11 that devastated the northeast coast, damaging roads, ports and other infrastructure and disrupting supply chains.

US crude stocks fall, gasoline stocks rise - API
NEW YORK, May 24 (Reuters) - U.S. crude oil stocks last week fell less than expected while gasoline stocks rose far more than analysts had forecast, the American Petroleum Institute said in its weekly report on Tuesday.
Domestic crude stocks fell 860,000 barrels in the week to May 20, the report showed, compared with expectations for a 1.3 million-barrel draw in a Reuters poll of analysts.
NATURAL GAS: Natural gas ends near flat after seesaw session
NEW YORK, May 24 (Reuters) - U.S. natural gas futures ended near unchanged on Tuesday after a seesaw session, as warm weather this week, firm cash prices and recent drilling rig declines offset early technical selling after a two-day run up.
"I'm not sure why paper (futures) tried to sell off - maybe a little back filling after the run up - but the South is warming up, and (Henry) Hub cash was trading above the screen again," a Houston-based trader said, adding there was a lot of storage to be filled which should support physical prices.

EURO COAL: ARA prices stable despite oil rise
LONDON, May 24 (Reuters) - Coal prices were little changed on Tuesday despite oil's $2 rise, as oversupply and lack of prompt demand weighed on DES ARA and FOB physical values.
Coal prices ought to soften by at least another $5 in the immediate term due to a temporary oversupply in Europe and weak demand in Asia, utilities, traders and producers said.

COMMODITIES: Oil, metals off highs as dlr recovers; grains dive
NEW YORK, May 24 (Reuters) - Commodities pared gains on Tuesday as the dollar recovered from early weakness, taking energy and metals prices off their highs and extending May's sharp swings in commodities.
"The forthcoming end of QE (quantitative easing) is taking some froth out of the commodity markets and there are some economic clouds around," said Simon Wardell, oil analyst at Global Insight.

20110525 1047 Global Economic Related News.

Vietnam: Inflation accelerates to 19.78%
Vietnam’s inflation accelerated to a 29-month high in May, adding pressure on officials to raise interest rates further and accept slower economic expansion to tame the fastest consumer-price growth in Asia. Prices rose 19.78% y-o-y, compared with 17.51% in April. That’s the quickest pace since December 2008. Prices rose 2.21% m-o-m. Overall food prices surged 28.34% in May y-o-y, while prices in the category including construction materials jumped 21.07%. (Bloomberg)

Middle East: World Bank says it will lend up to USD 6b to Egypt, Tunisia over the next two years to help them modernize their economies after popular revolts toppled their leaders this year. Support would include USD 4.5b for Egypt, where the International Monetary Fund is also expected to provide a loan, World Bank President Robert Zoellick said on a conference call. The Washington-based bank may also make USD 1b available to Tunisia, in addition to USD 500m in aid announced last month and not yet approved by the lender's board. (Source: Bloomberg)

Japan: Net overseas assets dropped for the first time in two years in 2010 as the yen's appreciation cut the value of those holdings. The value of net assets declined 5.5% YoY to JPY251.5tr (USD3.1tr) at the end of last year, the Finance Ministry said in Tokyo. Japan will remain the world's largest net external asset holder for the 20th year unless China increases its holdings more than 50% from JPY 167.7tr, the ministry said. (Source: Bloomberg)

Japan: Trade deficit as exports slump
Japan had a trade deficit for the first time in three months as exports slumped in the aftermath of the March 11 earthquake and a surge in commodity prices pushed up import costs. The trade deficit was JPY463.7bn (USD5.7bn) in April. Overseas shipments fell 12.5% in April y-o-y and imports rose 8.9%. The median forecast was for a shortfall of JPY703.7bn. (Bloomberg)

EU: German construction, exports drove first-quarter expansion
German companies boosted spending to meet increased export demand in the first quarter, while construction rebounded from a slump in the previous three months, fueling the fastest economic growth in almost a year. Construction spending jumped 6.2% q-o-q, when it fell 2.6%. Exports rose 2.3% after increasing 1.8% in the fourth quarter. GDP increased 1.5% when adjusted for seasonal swings. German consumer spending rose 0.4% in the first quarter q-o-q, when it increased 0.6%. Companies’ equipment spending advanced 4.2% and imports rose 1.5%. Gross fixed capital investment advanced 5% after falling 0.1%. (Bloomberg)

EU: German business confidence remains unexpectedly unchanged
German business confidence remained unexpectedly unchanged in May as booming exports and rising company spending boosted economic growth. The Ifo institute’s business climate index held at 114.2 from April. Economists forecasted a decline to 113.7. A gauge measuring the current assessment rose to 121.4 from 121 in April and a sub-indicator of expectations slipped to 107.4 from 107.7 in the previous month. (Bloomberg)

Spain: Sells EUR 2.3b (USD3.2b) of bills, close to the maximum target, in the first debt auction since the ruling Socialists' defeat in local elections pushed up borrowing costs. The Treasury said it sold EUR 999m of three-month bills at an average yield of 1.38%, compared with 1.371% last time the securities were auctioned in April. It sold EUR1.3b of six-month debt at an average yield of 1.766%, down from 1.867% at the last sale. (Source: Bloomberg) 

UK: Budget gap widens to GBP10bn as income falls
Britain posted its largest budget shortfall for any April since monthly records began in 1993 as tax revenue fell and spending climbed, casting doubt on whether the government can meet its deficit-reduction target this year. Net borrowing was GBP10bn, compared with GBP7.2bn a year earlier. The median forecasts was for a shortfall of GBP6.5bn. Revenue fell 0.8%, partly reflecting a one-time boost from a bank bonus tax a year ago, and spending rose 5%. (Bloomberg)

US: New homes sales rose in April for second month
Purchases of new houses rose in April for a second month as the market struggled to recover from a record low. Sales climbed 7.3% to a 323,000 annual pace last month. The median estimate called for sales at a 300,000 annual rate. New houses sold at a 278,000 rate in February, matching the pace in August as the lowest in data going back to 1963. The median sales price increased 4.6% y-o-y to USD217,900. The supply of homes at the current sales rate dropped to 6.5 month’s worth in April, the lowest in a year, from 7.2 months in March. There were 175,000

20110525 1046 Malaysia Corporate Related News.

 KLCI chart reading :
pullback correction little upside biased.

Aeon: To ink 9-year deal with 1Utama owner. Aeon Co (M) Bhd, which has managed the old wing of the 1Utama Shopping Complex for 15 years, is expected to sign a fixed nine-year lease agreement with mall's landlord, See Hoy Chan Holdings (SHC). (Source: Business Times)

Integrax: Forms committee. Port operator Integrax Bhd has formed a governance committee consisting of the companys board of directors to oversee all current impending legal matters. (Source: The Star)

Utilities: Acqua SPV makes fair value bid for Selangor water bonds. Acqua SPV Bhd, a special-purpose vehicle set up by Pengurusan Aset Air Bhd (PAAB), has made a firm offer to take over Selangor water bonds. (Source: The Star)

PAAB to acquire water bonds
The Selangor water impasse appears to have finally been broken. Syarikat Pengurusan Aset Air Bhd (PAAB) will acquire the securities issued by the Selangor state water concessionaires thorugh its wholly owned subsidiary Acqua SPV Bhd. The conditional offer amounting to RM6.5bn would see Acqua SPVE paying the settlement value for the securities based on the purchase yield to maturity, according to sources familiar with the matter. (Financial Daily)

UEM Land surges ahead of inclusion into MSCI index
UEM Land Holdings Bhd’s surges (UEML) share price surged yesterday in heavy trading of over 24.1m shares ahead of the stock’s inclusion into the 30 stock MSCI Malaysia index on 1 June, together with Malaysia Marine and Heavy Engineering Bhd (MMHE) and Malaysian Airports Holdings Bhd (MAHB). UEML rose 7 sen or 2.9% to RM2.81 while volume more than tripled from 6.8m shares on Monday.

RM30bn worth of PPP projects to be developed this year
A total of RM30bn worth of projects under the Public Private Partnership (PPP) are expected to be implemented this year from RM18bn recorded last year, said Prime Minister's Department public private partnership unit director-general Datuk Seri Dr Ali Hamsa .“Among the projects to be implemented are the construction of new toll highways, hospitals and universities' campus branches,” he said at a press conference after the launch of PPP Workshop Series 2 yesterday.(StarBiz)

MFM plans RM140m expansion
Malayan Flour Mills Bhd (MFM) will invest RM140m in 2011 to expand its production of flour and storage capacity in Malaysia to cater to rising demand. Its managing director Teh Wee Chye said the expansion, in both of its plant in Lumut and Pasir Gudang, will cover its milling and storage of raw material. “We are expanding on capacities as we foresee the prospect of increasing consumption,” he told reporters after the company’s AGM in Kuala Lumpur yesterday. (Malaysian Reserve)

Kenanga-ECM Libra merger “just a rumour”
Investment bank ECM Libra Financial Group Bhd dismissed rumors of a possible merger deal with K & N Kenanga Holdings Bhd, which was reported by a business weekly last month citing unnamed sources. “This is just a rumor and speculation,” a spokesperson from ECM Libra told The Malaysian Reserve in Kuala Lumpur yesterday when asked to comment on the issue after its AGM. The board of directors of ECM Libra refused to speak to reporters after the AGM yesterday. (Malaysian Reserve)

20110525 1037 Global Market Related News.

 DJIA chart reading : downside biased with possible pullback correction.

 Hang Seng chart reading : downside biased with possible pullback.

U.S. Stocks Drop as Slump in Industrial Shares Offsets Home Sales Report (Source: Bloomberg)
U.S. stocks retreated, sending benchmark indexes to one-month lows, as a drop in stocks most- tied to economic growth offset a government report showing that sales of new homes rose to the highest level this year. Shares of industrial, consumer-discretionary and technology companies led the declines in the Standard & Poor’s 500 Index. Goodyear Tire & Rubber Co. (GT) retreated 3.1 percent as China appealed a World Trade Organization ruling that backed U.S. duties on Chinese tire imports, saying the levies are “protectionist.” Freeport-McMoRan Copper & Gold Inc. (FCX) and Occidental Petroleum Corp. (OXY) rose at least 2.9 percent as Goldman Sachs Group Inc. signaled a positive outlook for commodities.

Purchases of New Homes in U.S. Probably Stagnated in April Near Record Low (Source: Bloomberg)
Purchases of new houses probably held close to a record low in April, showing the real-estate market remains a weak link in the U.S. expansion, economists said before a report today. New homes sold at a 300,000 annual pace last month, the same as in March, according to the median forecast of 75 economists surveyed by Bloomberg News. Purchases sank to a 270,000 pace in February, the weakest in 48 years of data.

China to further cut power to industry amid summer shortage
BEIJING, May 24 (Reuters) - Electricity supplies to industrial users will be cut further this summer as capacity shortages, coal supply problems and declining hydropower output combine to produce the worst power crunch in years, China's top grid company said.
Power deficits in the 26 provinces and regions serviced by State Grid Corp of China (SGCC) would total 30 gigawatts in the summer, even if coal supplies remained steady, water levels were normal and there were no persistent high temperatures, SGCC Vice General Manager Shuai Junqing was quoted as saying by the State Grid News, a company newspaper.

China Economic Growth Estimates Lowered as Wen’s Monetary Tightening Bites (Source: Bloomberg)
Goldman Sachs Group Inc. joined banks lowering their forecasts for China’s growth as Premier Wen Jiabao’s campaign to rein in inflation restrains the world’s fastest-growing major economy. China’s gross domestic product will gain 9.4 percent in 2011, less than a previous call of 10 percent, Goldman analysts Yu Song and Helen Qiao wrote in a note to clients today. Credit Suisse Group AG, JPMorgan Chase & Co., ING Groep NV and Daiwa Securities Group also pared their estimates this month.

Japan Swings to Trade Deficit in April (Source: Bloomberg)
Japan had a trade deficit for the first time in three months as exports slumped in the aftermath of the March 11 earthquake and a surge in commodity prices pushed up import costs.

Japan’s Government Bonds Decline as Yields Near Six-Month Low Damp Demand (Source: Bloomberg)
Japan’s 10-year bonds fell for the first time in six days on speculation yields near the lowest level since November damped investor demand.

European debt fears keep markets on edge
LONDON, May 24 (Reuters) - Financial markets paused for breath on Tuesday after being battered a day earlier on euro zone debt concerns, with new warnings about contagion fuelling fears the crisis is heading for a new, more dangerous phase.
European shares -- still in the red for the year -- edged higher and the euro sat above two-month lows versus the dollar, both boosted somewhat by better than expected German business sentiment.

Moody’s to Place 14 U.K. Banks on Review for Downgrade, Sky News Reports (Source: Bloomberg)
Moody’s Investors Service is likely to say it will consider downgrading debt for 14 of the 18 British banks and building societies it covers as withdrawal of government support may increase credit risk, Sky News said. More than one of the U.K.’s four biggest banks will be among the lenders to be put on review today, Sky reported in a blog on its website, citing people close to the ratings company.

Greece Will Accelerate State Asset Sales to Stem Debt Crisis as Bonds Drop (Source: Bloomberg)
The Greek government endorsed an accelerated asset-sale plan and 6 billion euros ($8.4 billion) of budget cuts to win extra aid and stem a market slide that threatens to swamp debt-laden euro-area nations.

Germany’s Business Confidence Unexpectedly Stable in May as Exports Boom (Source: Bloomberg)
German business confidence remained unexpectedly unchanged in May as booming exports and rising company spending boosted economic growth. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, held at 114.2 from April. Economists forecast a decline to 113.7, the median of 24 forecasts in a Bloomberg News survey showed.

German May business morale unchanged, beats fcasts
BERLIN, May 24 (Reuters) - German business sentiment held steady in May against expectations for a third consecutive monthly fall, signalling Europe's top economy may retain its strong momentum longer than thought before growth rates slow.
The Munich-based Ifo think tank said on Tuesday its business climate index, based on a monthly survey of some 7,000 firms, was unchanged at 114.2 from a reweighted April reading.

U.K. Financial Institutions Placed on Review for Lower Ratings by Moody’s (Source: Bloomberg)
Lloyds Banking Group Plc and Royal Bank of Scotland Group Plc are among 14 U.K. lenders whose debt Moody’s Investors Service is considering downgrading because the withdrawal of government support may increase their credit risk.

Budget Deficit Widens to $16.1 Billion as Tax Receipts Fall on Slow Growth (Source: Bloomberg)
Britain posted its largest budget shortfall for any April since monthly records began in 1993 as tax revenue fell and spending climbed, casting doubt on whether the government can meet its deficit-reduction target this year. Net borrowing was 10 billion pounds ($16.2 billion), compared with 7.2 billion pounds a year earlier, the Office for National Statistics said in London today. The median of 12 forecasts in a Bloomberg News survey was for a shortfall of 6.5 billion pounds. Revenue fell 0.8 percent, partly reflecting a one-time boost from a bank bonus tax a year ago, and spending rose 5 percent.

World Bank Will Lend Up to $6 Billion to Egypt, Tunisia Following Revolts (Source: Bloomberg)
The World Bank said it plans to provide as much as $6 billion in financing to Egypt and Tunisia over the next two years to help them modernize their economies after popular revolts toppled their leaders this year. Support would include $4.5 billion for Egypt, where the International Monetary Fund is also expected to provide a loan, World Bank President Robert Zoellick said on a conference call today. The Washington-based bank may also make $1 billion available to Tunisia, in addition to $500 million in aid announced last month and not yet approved by the lender’s board.

FOREX-Growth hopes draw euro off 2-mth low, still vulnerable
LONDON, May 24 (Reuters) - Upbeat data from Germany helped the euro recover from a two-month low against the dollar on Tuesday, but it remained fragile due to fears that the euro zone's debt crisis could spread. Data from the Ifo think-tank showed German business sentiment stabilising unexpectedly in May, pushing the euro briefly back above $1.4100 , away from Monday's two-month low of $1.3968.
It dropped again, however, after the leader of Greece's conservative political opposition rejected the government's new package of fiscal measures to slash deficits.

20110525 1034 Global Commodities Related News.

Corn (Source: CME)
US corn futures end sharply lower as traders take profits in the nearby contract after last week's 12% surge. Market participants unwind spread trades in which they had bought July corn and sold December, which rose 6% last week. Commodity funds contributed to the slide by selling an estimated 16,000 contracts, a healthy amount. Meanwhile, traders continue to watch weather forecasts as rains are expected to keep planting slow this week. Conditions look more favorable next week. CBOT July corn drops 20 3/4c to $7.33 1/4 a bushel while December corn slips 8c to $6.62 1/2.

Wheat (Source: CME)
US wheat futures crumble on profit-taking and hopes that rains will relieve dryness in Western Europe. Traders take money off the table after the front-month contract climbed 16% at the CBOT last week. Concerns about global supplies eased as rains were expected to fall in Germany and France. EU wheat futures weakened as well, losing 1.4% in Paris. CBOT July wheat dropped 2.9% to $7.79 3/4 a bushel, KCBT July slides 2% to $9.12 and MGEX July declines 1.2% to $9.88 3/4.

Rice (Source: CME)
US rice futures edge higher on concerns about floods reducing output. Crop losses are a hit, as farmers reduced rice plantings 17% from last year in favor of other crops. The American Farm Bureau Federation on Monday estimated 40% of the US crop was impacted by Mississippi River flooding. In Arkansas, 300,000 acres of rice, representing 21% of the state's crop, were affected, according to the group. CBOT July rice rises 5c to $15.13 per hundredweight.

Corn, Wheat, Soybeans Drop on Bets Demand Will Slump Following Rallies (Source: Bloomberg)
Corn futures fell the most in almost two weeks and wheat declined on speculation that demand may slow from importers, processors and investors after prices jumped last week. Soybeans also dropped. About 35.8 million bushels of corn were inspected for export in the week ended May 19, 5 percent less than a week earlier, while wheat inspections were little changed, the government said yesterday. Last week, wheat and corn futures both surged 11 percent on signs that wet weather in the U.S. delayed planting and may hurt crop yields.

Corn steady on planting progress, wheat up marginally
NEW DELHI, May 24 (Reuters) - Chicago corn futures were steady after a U.S. government report showed some progress in planting in the world's biggest exporter, while wheat rose 0.3 percent as dry weather in China and Europe continued to support the market. "We can see some progress in planting has been made but it is still slow," said Ker Chung Yang, an investment analyst at Phillip Futures in Singapore.

China 2011 corn output seen up 2.4 pct at record 181.5 mln T
BEIJING, May 24 (Reuters) - China's 2011 corn output will rise 2.4 percent from a year earlier to a record 181.50 million tonnes due to increasing acreage, China National Grain and Oils Information Center, a government grain think tank, said on Tuesday in its first forecast of the 2011 harvest.
Output of soybeans, which compete with corn for acreage, will fall 7.9 percent to 14 million tonnes, 1.2 million tonnes down from 2010, as the soy acreage shrinks 6.8 percent to the smallest area since 1999, CNGOIC forecast.

Floods swamp 3.6 mln ac US farmland;farm group
WASHINGTON, May 23 (Reuters) - Nearly 3.6 million acres of farmland in the Mississippi River valley, including 40 percent of U.S. rice area, have been affected by spring flooding, said the largest U.S. farm group on Monday.
The figure was larger than earlier reports of 3 million acres of flooded farmland and amounts to 1.1 percent of land usually planted in the two dozen principal U.S. field crops.

Corn planting seen 80 pct complete, narrowing deficit
CHICAGO, May 23 (Reuters) - U.S. farmers have nearly caught up to their traditional pace of corn planting after a third week of good weather, but growers may struggle to seed their last few acres due to cold and wet conditions, analysts said.
The U.S. Agriculture Department's weekly crop progress report on Monday afternoon is expected to show that farmers had planted 80 percent of their anticipated corn acreage as of May 22, based on an average of estimates given by 10 analysts. Last week the harvest was 63 percent completed.

Malawi's maize output seen at 3.8 mln T this yr
LILONGWE, May 23 (Reuters) - Malawi is expected to harvest 3.8 million tonnes of maize this year, up from 3.5 million reaped in the previous year, despite some dry periods during the season, President Bingu wa Mutharika said on Monday.
Malawi introduced a fertiliser and seed subsidy programme in 2004 and since then has recorded consecutive bumper harvests of maize, the country's staple food.

Rice prices seen stable on weather, inventory - IRRI
MANILA, May 24 (Reuters) - World rice prices should remain stable around current levels into 2012 on improved output due to sufficient rainfall and with plentiful stocks, the International Rice Research Institute (IRRI) said on Tuesday.
Total 2011/12 global rice output was forecast to meet the projected demand of 460 million tonnes given favourable weather, senior IRRI economist Samarendu Mohanty said.

Heavy weekend rains, severe storms hit US Midwest
CHICAGO, May 23 (Reuters) - Episodes of rain across the U.S. Midwest this week will add to crop planting delays, especially in the eastern Corn Belt and northern Plains, a forecaster said on Monday.
"It is going to be difficult to plant corn in Ohio this week and soybean planting is going to be rather slow beltwide given weekend rains and more showers coming," said Mike Palmerino, forecaster with Telvent DTN weather service.

Drought in EU and U.S. stressing crops and farmers
PARIS/CHICAGO, May 20 (Reuters) - Drought from Paris, France to Paris, Texas has farmers and grain dealers looking upwards. The farmers are looking to the skies for rain and the dealers are wondering where rising grain prices are going to stop.
U.S. wheat prices are on their way to their biggest weekly gain and European benchmark wheat futures have jumped just under 30 percent in the past nine weeks as wheat belts on both sides of the Atlantic show signs of irreversible drought damage.

Goldman, Morgan Stanley Bullish on Commodities Boosting Oil Forecasts 20% (Source: Bloomberg)
Goldman Sachs Group Inc. (GS) and Morgan Stanley increased their forecasts for crude-oil prices by more than 20 percent, signaling a bullish outlook for commodities. Goldman, which correctly advised investors to sell oil and copper last month before a price slump, boosted its 12-month prediction for Brent crude to $130 a barrel from $107, analysts led by Jeffrey Currie said today in a report. Morgan Stanley raised its estimate by 20 percent to an average $120 this year and by 24 percent to $130 in 2012.

Goldman Ups Oil, Aluminum Forecasts, Cuts Corn, Soybeans (Source: CME)
Goldman Sachs has made a raft of changes to its commodity price forecasts as the markets settle down following a period of volatility, upping its crude, aluminum and nickel forecasts and trimming its corn, soybeans and live cattle outlooks. The bank, which recently turned more bearish on a number of commodities including crude and copper, said it remained structurally bullish on the oil sector and revised its three month WTI crude forecast up to $108 a barrel, from $100/barrel previously. Events in the Middle East and North Africa are having a "persistent impact" on the oil market, Goldman Sachs said, and this has been a prime driver of its increase in price targets for the sector. Soybeans, corn and live cattle were meanwhile cut, with the bank noting it is adopting a "tactical wait-and-see approach to developing weather conditions."
Soybeans traded on the Chicago Board of Trade were cut to $14 a bushel on a 3-month basis from $15/bushel previously, and to $14.75/bushel on both a six- and 12-month basis from $15.75/bushel previously. Goldman cut its CBOT corn price three-month forecast to $8/bushel and its Chicago Mercantile Exchange live cattle forecast to $0.95 a pound from $1.15/lb previously, basis three-months.

Middle East Food Harvests At Risk From Alien Weed (Source: CME)
Food harvests in Iraq and Syria are at risk from infestations of an invasive alien weed, the United Nations' food body said, warning that the deadly plant could spread to other countries if unchecked. More than 60% of Syria's crops have been hit by silverleaf nightshade, a relative of the tomato originally hailing from tropical America, where it is damaging olive, cotton and wheat crops. A similar mass infestation has been reported in northwest Iraq and there are concerns that other countries could be at risk after the weed was spotted at sites in Lebanon and Jordan, the Food and Agriculture Organization said. "This particular type of weed competes aggressively with crops for nutrients whilst its deep root system dries down soil moisture," Gualbert Gbehounou, FAO Weed Officer, said a statement. Likely spread through untested shipments of agricultural products, silverleaf nightshade poses a particular threat to biodiversity in these Middle Eastern countries because it has no natural predators.
The FAO said it is implementing a project to assist farmers manage and prevent further spread of silverleaf nightshade in all four countries by enforcing crop rotation with competitor plants and encouraging governments to review their regulatory environments. "We want to introduce an integrated weed management approach, which means we will not focus on herbicides," said Gbehounou.

House Panel Proposes Cuts For USDA Spending In FY 2012 (Source: CME)
The House Appropriations Committee unveiled a proposal to slash federal funding for the U.S. Department of Agriculture in fiscal year 2012 with cuts in spending for agriculture research, conservation programs, food safety and other areas. The spending proposal of $17.3 billion in the bill also includes the budgets for the Food and Drug Administration and the Commodity Futures Trading Commission. That's $2.7 billion less than FY 2011. "As is the goal of all our Appropriations bills this year, this legislation reflects hard decisions to cut lower priority programs, reduce spending in programs that can be scaled back, and target funds where they are needed most so that our nation continues on the path to fiscal recovery," Kentucky Representative and Committee Chairman Harold Rogers said. Agriculture research at the USDA is slated for one of the biggest cuts: $354 million.
"While trimming spending, this funding level will continue to support important and high-priority research on devastating crop diseases, emerging chemical and biological threats, food safety, and water quality," the committee said Monday. The committee said the USDA's Food Safety Inspection Service will be able to continue ensuring the safety of the U.S. meat supply despite a proposed spending cut of $35 million. USDA Secretary Tom Vilsack has opposed previous proposals to cut food safety spending, saying that most of the funds there go to salaries of meat inspectors. "For our part, the Agriculture Subcommittee has sought to begin making some of the tough choices necessary to right the ship," Rep. Jack Kingston (R., Ga.) said Monday. "We have taken spending to below pre-stimulus, pre-bailout levels while ensuring USDA, FDA, CFTC and other agencies are provided the necessary resources to fulfill their duties."
The House spending proposal seeks just $2.2 billion for the FDA in 2012, down from $2.5 billion this year. CFTC Commissioner Bart Chilton said Monday that any spending cuts to the agency would be a mistake. "I'm greatly concerned about the House Agriculture Appropriations draft bill for FY 2012 that would essentially reduce the CFTC budget," Chilton said. "In my view, this is penny-wise and pound-foolish." Federal spending for the CFTC, an agency led by five commissioners that regulate commodity futures and option markets, would be shaved next year by $30 million, according to the House proposal.

China's CNGOIC Raises 2011 Grain Production Forecasts (Source: CME)
China raised its output projections across major grain categories for the year, with corn production leading the way with a forecast 2.5% rise, the state-backed China National Grain and Oils Information Center said. The agency's May forecast indicates that policy efforts to maintain or increase self-sufficiency in grains - corn, wheat, rice and tubers - while allowing for more imports of oilseeds, such as soybeans and rapeseed, are having the intended effect. Corn output is projected to see by far the largest increase among the key grain categories, rising to 181.5 million metric tons, the CNGOIC said. Wheat and rice output will grow more modestly, it said, with wheat production likely rising 0.3% to 115.5 million tons and rice output growing 0.9% to 197.6 million tons. The higher output projection for corn comes after a sustained period of government sales of the yellow grain in a bid to restrain downstream inflation.
"The desire for China to rebuild grain stocks through corn imports remains high," ANZ Bank said in a research note. "Since July 2009, China is estimated to have released 44 million tons from temporary and strategic reserves." In March, state stockpiler China National Grains Reserves Corp. stepped into the market to buy 1 million tons of U.S. corn as global prices fell. "This is one of the first examples of what will become increasingly common and paving the way for a new dynamic in global grain markets - China 'buying the dip' in 2011 and beyond," - ANZ said. While projected declines in China's corn output may have been contained by rising corn productivity, "this will not, however, dissuade the market of a potential increase in China's corn imports in the coming season, given China's relatively low corn stocks-to-use ratio," said Standard Chartered analyst Abah Ofon.
Based on U.S. Department of Agriculture data, Ofon estimated this ratio, an indicator of how much corn China held in store as a proportion of its consumption, at around 35.7% in 2010-11, down sharply from 85% in 2000-01. "There have been tangible stock draw-downs this season, and we believe a number of importers will be looking to restock their silos," Ofon wrote in a note. Corn imports in April nearly doubled on year, data from the General Administration of Customs showed this week, even as imports in other grain categories fell on the back of weaker demand in China. Sinograin, as the state stockpiler is known, has no current plans to import more corn, spokesman Cheng Bingzhou told Dow Jones Newswires, but state traders said China may re-enter the market if U.S. corn prices fall again. Meanwhile, higher prices have helped boost domestic acreage in most categories. Corn acreage this year will likely rise 2% to 33.1 million hectares, while rice acreage may rise 0.8%, the CNGOIC said.
Wheat acreage may fall 0.3% to 24.3 million hectares, largely due to a smaller spring-planted crop, the agency said. Among oilseeds, domestic output and acreage were likely to continue falling, it said. Soybean production this year may slip 7.9% to 14 million tons, while rapeseed output may fall 2.2% to 12.8 million tons. While soybean imports slumped in April, Ministry of Commerce forecasts show soybean imports may recover this month, as trading companies continued to import the commodity to take advantage of favourable financing options linked to such imports, mainly for construction-related financing purposes. Port stocks of soybeans have reached near-historic levels of about 7 million tons.

US Needs To Follow Through With Food Aid Pledge -US Official (Source: CME)
The U.S. has been too slow in following through with the funds it has pledged for international food and agriculture aid, a U.S. Treasury Department official said. Lael Brainard, under secretary for international affairs at the U.S. Treasury Department, said the funds are sorely needed to support the Global Agriculture and Food Security Program, a new multinational antihunger fund that launched last year. "Without greater progress on our pledge, it is difficult for the United States to convince other development partners to contribute, although I can assure you we are trying," Brainard said at a symposium held by the Chicago Council. "That's why it will be critical for Congress to fund the [Obama] administration's request for $308 million in fiscal year 2012." The Global Agriculture and Food Security Program so far has awarded grants to Bangladesh, Haiti, Rwanda, Sierra Leone and Togo for programs the countries designed to better feed their people through improved farming practices.
Congress approved $100 million for the fund for fiscal 2011, and that brought the total U.S. contribution up to $167 million, Brainard said, but the U.S. funding is still well short of the $475 million the country pledged. The fund got its origin from a decision first made by the Group of Eight highly industrialized nations at a 2009 summit to combat hunger by steering $22 billion in aid toward improving farming around the world. A component of that pledge became the Global Agriculture and Food Security Program. The U.S., Canada, South Korea, Australia, Spain and the Bill & Melinda Gates Foundation have all pledged millions of dollars to the fund, but only the U.S. and South Korean governments haven't completely matched their pledges with funds, according to an accounting released April 30 by the Global Agriculture and Food Security Program. Bill Gates, who spoke at the symposium, lauded the fund, to which his foundation has donated about $25 million, but he also warned that it is underfunded.
"One year ago, I joined with Treasury Secretary Tim Geithner and the finance ministers of Spain, Canada and South Korea to launch the Global Agriculture and Food Security Program," Gates said. "Unfortunately, a great model and proven success is no guarantee of federal funding."

Sugar, coffee rise early as commodities rebound
LONDON, May 24 (Reuters) - ICE sugar, coffee and cocoa futures rose in early trade, boosted by a rebound in crude oil and many other commodity markets after Monday's setback. ICE raw sugar was higher, clawing back some of the prior session's losses.

Ivorian rains boost cocoa, disease a worry-farmers
ABIDJAN, May 23 (Reuters) - Good rains interspersed with hot weather last week in Ivory Coast's cocoa growing regions are boosting the cocoa mid-crop, farmers said on Monday, but a lack of cash to pay for pesticides raised disease concerns.
Cocoa farmers in the bush said rains were adequate for the growth of a healthy April-September mid-crop as high moisture triggered new flowers that would turn into small pods in coming weeks and increase the size of the crop.

Crude Oil Rises as Dollar Slips, Goldman Sachs Boosts Brent Price Forecast (Source: Bloomberg)
Oil rose in New York as the dollar declined, boosting commodities’ appeal as an alternative investment, and Goldman Sachs Group Inc. and Morgan Stanley increased their price outlooks for crude. Futures jumped 1.9 percent as the dollar slipped from a nine-week high against the euro after German business confidence unexpectedly stayed near a record in May. Goldman Sachs and Morgan Stanley raised their estimates for Brent oil futures, saying the conflict in Libya is eating into OPEC spare capacity.

Copper market deficit at 60,000 T for Jan-Feb-ICSG
LONDON, May 24 (Reuters) - The world copper market had a 60,000 tonne deficit in January to February compared with a surplus of 119,000 tonnes in the same period last year, an industry report showed.
The International Copper Study Group (ICSG) said in its latest monthly bulletin late on Monday that world refined copper output in January-February was 3.028 million tonnes and consumption was 3.088 million tonnes.

Japan Apr steel output drop not as deep as expected
TOKYO, May 23 (Reuters) - Japan's earthquake hit steel production in April but not by as much as was expected, which, with demand hit more, stirred concern over too much supply.
Crude steel output reached a higher than expected 8.42 million tonnes, down just 7.6 percent or 694,000 tonnes from March, The Japan Iron and Steel Federation said on Monday.

China April rare earth exports down 53 pct y/y, values top $120,000/t
BEIJING, May 23 (Reuters) - China's exports of rare earths fell by more than half in April from a year previously, detailed Customs data showed on Monday, despite headline official data that indicated a rise of 46 percent.
China exported 1,819 tonnes of rare earths in April, figures supplied to Reuters by China's General Administration of Customs showed, a 53 percent decline from April 2010 and a 12.6 percent slip from the volume exported in March.

METALS-Copper up on softer dlr, debt worries mute gains
LONDON, May 24 (Reuters) - Copper rose on Tuesday, recovering with a weaker dollar, but worries over European sovereign debt contagion and Chinese demand suggest gains could be short-lived. Three month copper  on the London Metal Exchange traded at $8,937 at 0939 GMT. The metal closed at $8,795 a tonne on Monday when it fell by some 3 percent to a one-week low.
"Fundamentally, are things much better? No. I would expect things to remain under pressure for the next few months but right now (the complex) is taking a breather," analyst Daniel Brebner of Deutsche Bank said.

PRECIOUS-Gold hits two-week high on euro debt worries
LONDON, May 24 (Reuters) - Gold rose to a two-week high on Tuesday as concerns about a spreading EU debt crisis fuelled safe haven buying, while a softer dollar provided support. Spot gold  hit $1,521.80 a troy ounce, its highest since May 11. It was bid at $1,520.59 an ounce at 0944 GMT from $1,516.05 late in New York on Monday.
Portugal and Ireland would be at risk of multi-notch credit downgrades, pushing their ratings into junk territory in the event of a default by Greece, Moody's EMEA chief credit officer told Reuters. 

20110525 1031 Soy Oil & Palm Oil Related News.

 Soy Oil chart reading : side way range bound.

ITS CPO export up 23.4% to 1,068,050 tonnes for the period of 1~25 May 2011.
SGS CPO export up 16.5% to 1,104,075 tonnes for the period of 1~25 May 2011.

Soybeans (Source: CME)
US soybean futures ended mixed, with nearby contracts succumbing to spillover pressure from corn and wheat in the absence of fresh demand to give prices a boost, said Chad Henderson, analyst with Prime Ag Consultants. A tight supply scenario keeping a level of uncertainty in the market encouraged processors to push cash bids to secure supplies to meet needs through the summer. Deferred month contracts managed to rise on worries farmers may not plant as many acres as previously expected. CBOT July soy settled down 0.1% at $13.72 1/4/bushel; Nov soy up 0.3% at $13.54 1/4.

Soybean Meal/Oil (Source: CME)
Soy-product futures end higher after trading in both positive and negative territory during the session as the markets were forced to do a balancing act between supportive outside market influences and slower demand. Soyoil futures led the advances, supported by a rebound for crude oil. CBOT July soyoil settled up 0.5% at 57.48c/pound while July soymeal rose 0.1% to $359.20/short ton.

Girl Scouts Agree To Research Palm Oil In Cookies (Source: CME)
The two Michigan teens campaigning to replace palm oil in Girl Scout cookies are a step closer to a solution. During a two-hour meeting at Girl Scouts of the USA headquarters in New York City, scout officials agreed to research palm oil to determine if they can get more of the ingredient from rainforests that haven't been cleared for palm oil plantations, or if they can replace it with something else. "This is definitely a step in the right direction," said Madison Vorva, 16, one of the two scouts who met with Girl Scouts officials. "It's taken a lot of work to get to where we are today." Amanda Hamaker, product sales manager for Girl Scouts of the USA, said the organization plans to reach out to the Union of Concerned Scientists, the World Wildlife Fund and other environmental groups about palm oil production.
"We need to define for ourselves what sustainability is," she said. Hamaker said once the organization has learned more, it will arrange a call with Madison and her fellow scout, Rhiannon Tomtishen, 15, to determine the next steps. Rhiannon and Madison were the subject of a Page One story in The Wall Street Journal last Friday. The two became concerned about the presence of palm oil in the cookies after they studied orangutans as part of a project to earn their Girl Scout Bronze Award four years ago. They learned that palm oil plantations are sometimes built on orangutan habitat. In recent months, the girls have been pressuring the organization by enlisting the help of activist groups that wrote letters on their behalf and by encouraging supporters to post messages on the Girl Scouts' Facebook page.
"We were interested in starting the dialogue and that's what's happening," said Rhiannon.

Palm ticks up as exports eyed; euro debts worries remain
JAKARTA, May 24 (Reuters) - Malaysian palm oil futures rebounded higher, as investors positioned themselves ahead of export data later this week, though lingering worries about euro-zone debt capped gains. "Everything else is positive - even crude oil came up a little bit," said one trader. "Volumes are very small and we are waiting for the export rumours."

Japan soybean imports up 2 pct in 2010-attache
WASHINGTON, May 23 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in Japan:
"Japan's total soybean imports in 2010 were approximately 3.5 million tonnes, up 1.9 percent from 3.4 million tonnes in 2009, of which the United States supplied 2.5 million tonnes. Demand for temperate oil in 2010 increased 0.8 percent from 2009 while demand for tropical oil increased 8.9 percent over the same period.