Monday, June 6, 2011

20110606 1815 FCPO EOD Daily Chart Study.

FCPO closed : 3388, changed : -33 points, volume : lower.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : weakening, buyer reducing exposure.
Support : 3350, 3300, 3270, 3250 level.
Resistance : 3420, 3450, 3470, 3500 level.
Comment :
FCPO closed recorded loss with lower volume participation while soy oil last Friday closed softer and currently trading downwards registering loss.
Reuters latest survey shows that market anticipation a lower export, higher output and stock level in fact market in expecting a 16 month highs stock level triggered more selling activities today reducing exposure.
Daily chart formed a down bar candle with upper shadow positioned nearer to middle Bollinger band after market opened 1 tick lower, testing higher resistance before slide downwards all the way to closed near the low of the day.
Chart reading wise, market is likely to trade correction range bound upside biased market for the near term 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.

20110606 1726 FKLI EOD Daily Chart Study.

FKLI closed : 1553.5 changed : -5.0 points, volume : lower.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : turned downward, buyer reducing exposure.
Support : 1550, 1540, 1530, 1515 level.
Resistance : 1565, 1580, 1590, 1600 level.
Comment :
FKLI closed recorded loss thin volume traded doing 1 point premium compare to cash market that closed lower while regional(Asia & European) trading mostly lower with Hong Kong and China exchange closed for holiday while last Friday U.S. market closed weaker.
Market sentiment still biased to negative after U.S. employment grew at a slower pace, market anticipate a wider U.S. trade deficit and concern over unsolved U.S. dept ceiling issue.
Daily chart formed a down doji bar candle candle positioned in between upper and middle Bollinger band level after market opened weaker, traded range bound tested lower support level and closed recovered upward slightly near opening price.
Technical reading remained suggesting a correction range bound upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with larger cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110606 1503 Global Market & Commodities Related News.

Stocks slip on slower growth, euro eyes $1.47
SINGAPORE, June 6 (Reuters) - - Asian stocks slipped on Monday after weak U.S. employment data set a cautious tone to the week, further hobbling the dollar and putting the rising euro on a path to $1.50 ahead of a European Central Bank policy meeting.
"What other major global stock markets are undervalued to this extent?" said Kenichi Hirano, a strategist at Tachibana Securities. "The U.S. market may have entered a correction phase, but the Tokyo market may not follow suit."

U.S. wheat ticks up; grain markets eye planting report
SINGAPORE, June 6 (Reuters) - Chicago wheat edged higher, supported by a weak dollar, while corn and soy were little changed ahead of a U.S. plantings report expected to show that farmers made progress in crop seeding following dry weather in the Midwest.
"I think it's going to be fairly slow with positioning ahead of those reports," said Adam Davis, a senior commodity analyst at Melbourne-based fund manager Merricks Capital.

Early India rains may leave 1 mln T cane uncrushed in Maharashtra
MUMBAI, June 6 (Reuters) - Early arrival of monsoon rains in India's western Maharashtra state, the biggest sugar producer in the country, are likely to leave more than 1 million tonnes of cane uncrushed in 2010/11 season ending September, a senior state government official said.
"Cane producing areas have seen heavy rainfall in the last two-three days forcing factories to end crushing operations for this season (2010/11)," said a senior official at the state's sugar commissioner's office.

Argentine farmers hoard soy, bet on higher prices
BUENOS AIRES, June 3 (Reuters) - Argentina's 2010/11 soy harvest is almost finished, but growers are hoarding millions of tonnes of beans on their farms, gambling that sizzling global prices will climb even higher.
Healthy profit margins this year and a bumper harvest estimated at close to 50 million tonnes mean farmers in the world's No. 3 soy exporter can afford to take a risk and keep their sales to a minimum, industry analysts say.

Rain too late for French wheat, may help maize-INRA
PARIS, June 3 (Reuters) - Rain forecast in drought-hit France in the coming week should boost spring-sown crops such as maize and forage plants grown for animal feed, but will come too late to revive wheat yields, French agronomists said on Friday.
French farmland has been parched by exceptionally dry spring weather coupled with waves of summer-style heat, leading the government to pledge hundreds of millions of euros for livestock farmers whose fodder supply has dwindled.

Global supply fears may give Vietnam coffee an edge
SINGAPORE, June 3 (Reuters) - Vietnam may enjoy high coffee prices in the second half of this year despite higher domestic output in the world's top robusta producer, as inclement crop weather in some growers and a bad harvest in Indonesia triggers concerns about yields and quality.
Global robusta prices have surged more than 80 percent to above $2,600 a tonne in the past year and local beans rallied to a record near 52 million dong ($2,534), but farmers often hold back stocks for better offers, tightening prompt deliveries.

Brazil coffee frost risk highest since 2000
BRASILIA/NEW YORK, June 3 (Reuters) - From droughts to floods to hurricanes, commodity traders have been roiled by a record dose of almost every variety of inclement weather under the sun, save one -- a coffee-curdling frost in Brazil.
But this year, just as global stocks of coffee beans dwindle to their lowest since records began, Brazil's number may be up.

Oil dips, weak U.S. jobs data continues to weigh
PERTH, June 6 (Reuters) - Brent crude slipped toward $115 a barrel on concern about demand after disappointing jobs data from top consumer United States, but a softer dollar and political upheaval in the Middle East limited losses.
"Today there is no shortage of supply. OPEC will do its job," the chief executive of the French energy giant Total said at a conference in Kuala Lumpur.

LME copper firms 0.3 pct on soft dollar, zinc up
SINGAPORE, June 6 (Reuters) - London copper rose 0.3 percent, buoyed by a softer dollar and expectations that the Federal Reserve will continue to supply liquidity to the market, while zinc added 1.4 percent with an extra fillip from an LME margin cut.
"Copper gave up some of its early gains as the dollar recovered from its lows," said a trader in Perth.

Gold firms on weak dollar, soft U.S. jobs data
SINGAPORE, June 6 (Reuters) - Gold strengthened, extending gains made in the previous session, as a disappointing U.S. jobs data fueled fears of a slowdown in recovery of the world's biggest economy and a softer dollar lent support.
"The weak U.S. data has increased the possibility of a third round of quantitative easing," said Ong Yi Ling, an analyst at Phillip Futures.

20110606 1136 Global Economic Related News.

Portugal: Social Democrats win vote, oust socialist Socrates
Portugal’s opposition Social Democrats ousted the ruling Socialists in elections, putting Pedro Passos Coelho in charge of enforcing austerity measures mandated by a EUR78bn (USD114bn) bailout. Coelho, who unseated Prime Minister Jose Socrates, said he would seek to forge a governing majority with the third-place People’s Party to enact budget cuts that risk worsening an economic slump and 12.4% unemployment rate. With 99% of districts reporting, the two parties won a combined 129 seats in the 230-member parliament. (Bloomberg)

Australia: La Nina-triggered flood bill to total AUD12bn
Australia’s bill from floods that devastated the nation’s northeast earlier this year climbed 33% to AUD12bn (USD13bn), with resources and agriculture the hardest hit, the government said. “Lost commodity production is likely to be around AUD9bn and damage to crops more than AUD2bn,” Treasurer Wayne Swan said. “We’ve seen economic data that clearly reflects the destruction.” (Bloomberg)

Egypt: IMF agrees to USD3bn Egypt lpan for Post-Mubarak transition
Egypt and a visiting International Monetary Fund mission agreed to a USD3bn loan as the North African country seeks to fund its widening budget deficit after a popular revolt earlier this year. The 12-month loan is part of wider international support pledges for Egypt, where the turmoil that accompanied the uprising that led to the ouster of President Hosni Mubarak has hurt revenue from tourism and industrial output. (Bloomberg)

EU: Preparing new Greek rescue after aid payout approved
European Union officials will focus on preparing a new aid package for Greece that includes a “voluntary” role for investors after the EU and the International Monetary Fund approved the fifth installment of Greece’s EUR110bn (USD161bn) bailout. (Bloomberg)

U.K: Bank of England will hold off increasing its benchmark interest rate next week as manufacturing and services surveys this week indicate the economic recovery is faltering. The nine-member Monetary Policy Committee, led by Governor Mervyn King, will leave the key rate at a record low of 0.5% on June 9, according to all 55 economists in a Bloomberg News survey. It will also keep its bond-purchase plan at GBP200b (USD326b), said all 35 economists in a separate poll. (Source: Bloomberg)  

US: Trade gap probably widened in April
The US trade deficit probably widened in April to a 10-month high, reflecting higher crude oil costs that have since retreated, economists said before a report this week. The gap expanded to USD48.9bn from the USD48.2 bn shortfall in March, according to the median of 61 estimates in a survey ahead of the Commerce Department’s 9 June report. Other figures may show prices of goods from abroad decreased in May by the most in almost a year, showing the surge in commodity costs is fading. (Bloomberg)

U.S: Payrolls grew at the slowest pace in eight months and the jobless rate unexpectedly climbed to 9.1% in May, reinforcing signs that a slowdown in the worlds largest economy is persisting into the second quarter. Employers added a less-than-projected 54,000 jobs last month, after a revised 232,000 gain in April that was smaller than initially estimated, Labor Department figures showed. The jobless rate climbed to the highest level this year from 9% a month earlier. (Source: Bloomberg)

U.S: Service industries expanded more than forecast in May, tempering concern the world's largest economy is faltering. The Institute for Supply Managements index of non- manufacturing businesses increased to 54.6 from 52.8 in April. A reading above 50 signals expansion. (Source: Bloomberg)

20110606 1135 Malaysia Corporate Related News.

KLCI chart reading :
correction range bound upside biased.

MAS confident of continuing to rise despite escalating fuel price
Malaysia Airlines (MAS) recorded an 18% higher international pre-load this year compared with 2010. Overall,, when combined with the domestic sector, its pre-load factor was up 10% compared with last year, said senior general manager (sales and marketing) Datuk Bernard Francis. He was confident the pre-load factor would continue to rise despite escalating fuel prices, which are affecting travellers in terms of fuel surcharges. Load factor for 3Q (July to September 2010) was 79% - its highest seat factor in 15 years, and for the last quarter of 2010 it was 77.4%. For 2010 it was 76.2% and the airline added 4% new capacity. For 1Q of 2011, load factor was at 76% and new capacity added during the period was 11% from a year ago. (StarBiz)

Privasia to focus on merger & acquisitions
Information and communications technology company Privasia Technology Bhd plans to focus more on merger and acquisition-based expansion instead of looking for new projects in 2011 following its strong orderbook value to date. Its chief executive officer Puvanesan Subenthiran said Privasia’s balance sheet continued to improve with financial flexibility to gear up for M&A-based expansion plans.(Malaysian Reserve)

SP Setia plans RM2.8bn projects
SP Setia will redevelop the Sri Johor, Sri Pulau Pinang and Sri Melaka low-cost apartments and the Taman Ikan Emas low cost homes in Bandar Tun Razak, Cheras at a total development value of RM2.8bn. Its deputy president and CEO Datuk Voon Tin Yow said the first phase of the project would take off next month. Urban Wellbeing Minister Datuk Raja Nong Chik said the first phase of the project would involve the development of affordable, quality homes totalling 1,255 units. These would be completed in three years. He said SP Setia would also undertake an apartment housing project in the area for young executives, with each unit to cost not more than RM300,000 and with a built-up areas of at least 800 sq ft. (StarBiz)

Scomi and partners bag RM2.6bn Brazilian monorail deal
Scomi Engineering and its consortium partners have clinched a RM2.6bn contract to build a monorail line in Sao Paulo, Brazil. The Sao Paulo Metropolitan Co in Brazil awarded the design, manufacture, supply and implementation job of the 18-km monorail Line 17-Gold Metro of Sao Paulo to Consortium Monotrilho Integracao last Thursday, following an international competitive tender process. The consortium consists of Scomi Engineering, Andrade Gutierrez S.A., CR Almeida S.A. Engenharia de Obras and Montagens e Projetos Especiais SA. The contract will include the supply of 24 car train sets comprising three cars each. The monorail will be able to carry some 252,000 passengers per day. It will run through 18 stations from Jabaquara to Sao Paulo-Morumbi. The project will kick off next month and should be completed in three-and-a half years. (StarBiz)

Celcom signs broadband deal with TM
Axiata Group said its wholly-owned unit Celcom Axiata has entered into a HSBB services agreement with Telekom Malaysia (TM). The deal is for the supply, delivery, installation and commissioning of access services related to HSBB for Celcom Mobile's utilisation. The company said that the agreement came following a memorandum of understanding between Celcom and TM on strategic collaboration in providing fixed and mobile solutions earlier this year. Under the agreement, Celcom Mobile will also grant TM its mobile virtual network operator services. (StarBiz)

Mudajaya unit gets letter of intent for RM720m sub-con job at Manjung plant
Mudajaya Group Bhd’s unit Mudajaya Corporation has been given a letter of intent to design and build a component of the Manjung power plant for a sub-contract valued at RM720m. In a filing to Bursa Malaysia Securities on Friday, Mudajaya said Mudajaya Corp was the given the letter on 2 June by CMC Machipex SB to build the balance of plant component of Manjung No. 4 Power Plant Project. It said Mudajaya Corp was authorised to start mobilisation on 6 June to undertake the advanced sub-contract works as well. Mudajaya said the execution of the sub-contract would be subject to the conclusion of the terms and conditions of the contract and the approval from the parent company of CMC. (Financial Daily)

Century Software gets RM22.53m job from Ministry of Finance
Century Software Holdings Bhd’s unit Century Software (M) SB has been awarded a RM22.53m contract by the Ministry of Finance to implement an online budget system. In a statement last Friday, Century Software said the contract was for a period of ten months from June 2011. It said the contract was expected to contribute positively to its earnings for the financial year ending 31 Dec 2011. “This prestigious contract is a pioneering and first of its kind project in Malaysia to be implemented by 24 government Ministries. “This significant contract would propel Century Software as a leading provider of world-class financial system services within the Asean region,” it said. (Financial Daily)

Eversendai will use the RM270m from its IPO for capital expenditure
The flotation of Eversendai Corp Bhd on the Main Market of Bursa Malaysia on 1 July will raise RM270m for the company. Its founder Datuk A.K. Nathan will realise a gain of RM130m for selling 30% of the company he pioneered 27 years ago. Nathan said in an interview with Starbiz that the company would use the proceeds of RM270m from its share sale as capital expenditure. “We will be using the proceeds to build a new plant in Trichy in India and expand our plant facilities in Rawang. We would also be using the funds to build staff accommodation in the Middle East,'' he said. He added that the choice of Trichy over other locations in India was made because it was easier to get skilled manpower for the plant there. Eversendai has four plants that provided all the fabrication works for its projects that span from Malaysia to India and the Middle East. The plants are located in Rawang, Dubai, Sharjah and Qatar. The new plant in India will have a 30,000-tonne-a-year fabrication capacity. (StarBiz)

Nestle: Not ruling out expansion of coffee plant. Nestle (Malaysia) Bhd will not rule out the possibility of expanding its coffee manufacturing facility in Malaysia as it expects surging demand for coffee. (Source: Business Times)

20110606 1101 Global Market & Commodities Related News.

OIL: Crude up on weak dollar but gains seen limited
TOKYO, June 6 (Reuters) - U.S. crude futures headed higher on Monday as the dollar remained soft but gains were set to be limited after weak U.S. jobs data added to evidence of a marked economic slowdown.
"We need to increase by at least one million barrels a day," a Gulf OPEC delegate told Reuters in Vienna on Sunday. "We're not happy with current prices."

NATURAL GAS: Natural gas ends lower; weather, economy weigh
NEW YORK, June 3 (Reuters) - U.S. natural gas futures slid nearly 2 percent on Friday, pressured by weaker crude futures, poor economic data, moderating weather forecasts and improved nuclear generation.
"Natural gas prices were a victim of sluggish economic data, indicating a soft patch for the U.S. economy, as well as cooler temperatures covering key consuming regions. Given this, demand over the short-term should soften resulting in traders taking some long positions off the table," said Caprock Risk Management's senior analyst, Chris Jarvis.

COMMODITIES: U.S. jobs data helps lift gold and copper
NEW YORK, June 3 (Reuters) - Gold and copper rose on Friday, as the dollar tumbled after weaker-than-expected U.S. jobs data, while U.S. soybeans hit a two-month high as corn planting weather improved, easing pressure on farmers to switch acres to soy.
"Suddenly QE3 is back on. It doesn't matter what the reality is, it matters what the perception is, and the perception is that QE3 will at least be debated again instead of being tossed on the fire," said Dennis Gartman of The Gartman Letter.

GLOBAL MARKETS: Stocks slip on slower growth, euro drifts higher
SINGAPORE, June 6 (Reuters) - - Japanese and Australian stocks slipped on Monday after weak U.S. employment data set a cautious tone to the week, further hobbling the dollar and putting the rising euro on a path to $1.50 ahead of a European Central Bank policy meeting later in the week.
The smallest U.S. jobs growth in eight months in May reflected a global business cycle shifting to slower growth and confirmed what many investors had been already anticipating by taking a defensive stance in their portfolios.

Total CEO says oil market is well supplied
KUALA LUMPUR, June 6 (Reuters) - There is no shortage of oil supply, the chief executive of the French oil major Total  said on Monday.
"OPEC will do its job," Christophe De Margerie told reporters at a conference in Kuala Lumpur. 

20110606 1021 Global Market Related News.

  DJIA chart reading : downside biased with possible pullback.
  Hang Seng chart reading : side way range bound little downside biased.

Tread water before US job data; bond outlook brightens
HONG KONG, June 3 (Reuters) - Stocks steadied, bond yields dipped and the euro rose to a one-month high versus the dollar on Friday as investors braced for a key U.S. jobs report that could feed debate over whether the economy is headed for a protracted slowdown.
"Tighter monetary policy is still likely, because policy rates are still low relative to current and average historical underlying inflation rates, but if headline inflation rates stabilize, the amount of tightening that we are likely to see in the coming months is mostly priced into bonds,"  DBS said.

Dow Average Has Its Longest Weekly Slump Since 2004 on Employment Report (Source: Bloomberg)
U.S. stocks fell this week, sending the Dow Jones Industrial Average to its longest streak of losses since 2004, after worse-than-estimated reports on jobs and manufacturing fueled concern earnings growth will slow. All 10 Standard & Poor’s 500 Index groups dropped, with declines exceeding 1.3 percent. Newell Rubbermaid Inc. (NWL) sank 15 percent, leading declines in the Standard & Poor’s 500 Index, after cutting its profit forecast. J.C. Penney Co. and Stanley Black & Decker Inc. (SWK) slumped more than 6 percent as investors sold companies tied to economic growth. General Motors Co. (GM) and Ford Motor Co. (F) decreased at least 4 percent after sales growth missed projections.

Slowing U.S. Growth Prompts Optimists to Question Durability of Recovery (Source: Bloomberg)
A string of disappointing economic data capped by last week’s jobs report is prompting even some of the more optimistic economists to question the durability of the U.S. recovery.

High US jobless claims add to slowdown concerns
WASHINGTON, June 2 (Reuters) - The number of Americans signing up for jobless benefits fell only slightly last week, doing little to calm growing fears of a pullback in the U.S. economy's recovery.
Initial claims for state jobless benefits slipped 6,000 to 422,000, the Labor Department said on Thursday, which was higher than the 415,000 claims expected by economists.

Moody's sounds alarm over US debt limit, deficits
NEW YORK/WASHINGTON, June 2 (Reuters) - Ratings agency Moody's warned on Thursday it would consider cutting the United States' coveted top-notch credit rating if the White House and Congress do not make progress by mid-July in talks to raise the U.S. debt limit.
Treasury Secretary Timothy Geithner, seeking to convince Congress to increase his borrowing authority and prevent a government default, went to Capitol Hill to press his case in a 45-minute meeting with first-term lawmakers.

Trade Gap in U.S. Probably Widened in April as Imported Oil Prices Climbed (Source: Bloomberg)
The U.S. trade deficit probably widened in April to a 10-month high, reflecting higher crude oil costs that have since retreated, economists said before a report this week.

Obama Is Focusing on Tax Incentives, Subsidies to Spur Jobs, Goolsbee Says (Source: Bloomberg)
Austan Goolsbee, President Barack Obama’s chief economist, said the government is seeking to help private businesses spur job growth through tax incentives and investment subsidies. “We want to leverage the private sector money,” Goolsbee, chairman of the Council of Economic Advisers, said in an interview today on CNN’s “State of the Union” program. “Corporations have become profitable again,” he said. “What we need to do now is get the private sector stood up.”

Jobless Rate Unexpectedly Rises in Sign of Extended U.S. Economy Slowdow (Source: Bloomberg)
The unemployment rate in the U.S. unexpectedly climbed to 9.1 percent in May and payrolls grew at the slowest pace in eight months, showing employers are losing confidence as the economy slows. The jobless rate increased to the highest level this year from 9 percent a month earlier, Labor Department figures showed yesterday in Washington. Employers added a less-than-projected 54,000 jobs last month, after a revised 232,000 gain in April that was smaller than initially estimated. The median forecast in a Bloomberg News survey called for payrolls to rise 165,000.

Japan Stocks Decline for Third Day; Tepco Plunges (Source: Bloomberg)
Japanese stocks declined for a third day as slowing U.S. job growth fueled concern the global economy is weakening.

Portugal’s Social Democrats Defeat Socrates, Hand Coelho Coalition Chance (Source: Bloomberg)
Portugal’s opposition Social Democrats ousted the ruling Socialists in elections, putting Pedro Passos Coelho in charge of enforcing austerity measures mandated by a 78 billion-euro ($114 billion) bailout. Coelho, who unseated Prime Minister Jose Socrates, said he would seek to forge a governing majority with the third-place People’s Party to enact budget cuts that risk worsening an economic slump and 12.4 percent unemployment rate. With 99 percent of districts reporting, the two parties won a combined 129 seats in the 230-member parliament.

Euro Rises to Month High Versus Dollar on Optimism EU Will Support Greece (Source: Bloomberg)
The euro rose to a month high versus the dollar on prospects officials from the European Union will reiterate their intention to prepare a new aid package for Greece, easing concern over the region’s debt crisis.

U.K. Factory Production Strengthens as Export Demand Picks Up, EEF Says (Source: Bloomberg)
U.K. factory production strengthened in the second quarter as companies benefited from increasing export orders, the Engineering Employers Federation said. A measure of output rose to 28 from 25 in the first three months of the year, the EEF, a lobby for manufacturers, and BDO Stoy Hayward LLP said in a report released today in London. A gauge of new export orders increased to 28 from 25.

Barclays Capital Cuts Pound Forecasts on Central Bank Interest-Rate View (Source: Bloomberg)
Barclays Capital cut its six-month and one-year forecasts for the pound, citing the outlook for Bank of England interest rates after data showed weaker than expected U.K. services growth last month. Barclays Capital cut its six-month forecast to $1.74 from $1.76 and 85 pence per euro from 84 pence per euro. The one-year forecasts were reduced to $1.76 from $1.80 and 82 pence per euro from 80 pence, Paul Robinson, London-based head of European currency strategy at the investment-banking unit of Barclays Plc, wrote in an e-mailed note today.

Australia’s La Nina-Triggered Flood Bill to Reach $12 Billion, Swan Says (Source: Bloomberg)
Australia’s bill from floods that devastated the nation’s northeast earlier this year climbed 33 percent to A$12 billion ($13 billion), with resources and agriculture the hardest hit, the government said. “Lost commodity production is likely to be around A$9 billion and damage to crops more than A$2 billion,” Treasurer Wayne Swan said in an e-mailed statement yesterday. “We’ve seen economic data that clearly reflects the destruction.”

FOREX-Euro holds near 1-mth high vs dlr before U.S. jobs
LONDON, June 3 (Reuters) - The euro hovered near a one-month high against the dollar on Friday as investors anticipated weak U.S. jobs data that could signal a protracted soft patch in the world's biggest economy and weigh further on the U.S. currency.
However, traders said the euro could struggle to make gains beyond the one-month high of $1.4518 hit in Asian trade, citing selling interest around that level, more ahead of an options barrier at $1.4550 and further offers around $1.4565-70.

20110606 1017 Global Commodities Related News.

Corn (Source: CME)
US corn futures end lower amid outside market pressure and lackluster export sales. A negative US jobs report cast a gloomy outlook for the economy, which would not help demand. Analysts add that weekly export sales remain disappointing. The market pulled back after two days of strong gains on crop concerns. While those concerns persist, weather in many areas where the crop has been planted is favorable. Amid the losses the Dec contract, which reflects new crop supplies, gained on July for the second straight day. July CBOT corn ends down 12 1/2 cents, or 1.6%, to $7.54 per bushel and Dec corn slips 8 3/4 cents to $6.86 1/4.

Wheat (Source: CME)
US wheat futures finish higher on projections for increased demand from livestock producers. Global wheat feeding is expected to rise after CBOT prices traded nearly even with corn Thursday. Wheat typically holds a premium to corn. "You can't come in here and say US corn looks cheap," says Chad Henderson, analyst for Prime Agricultural Consultants. MGEX spring wheat, meanwhile, surged on wet weather delaying planting in the US northern Plains. CBOT July wheat rose 4c to $7.73 3/4 a bushel, KCBT July gained 5 1/4c to $9.14 1/4 and MGEX July soared 41c to $10.60 1/2.

Pork Complex (Source: CME)
US lean hogs end mixed amid mostly firm cash prices and worries about demand. Gloomy economic outlook, fueled by disappointing May jobs report, loomed over the market. Packer margins are negative, though supplies are still relatively tight, analysts say. A rally in cattle also offered support. June CME lean hogs close up 0.150c to 89.225 cents/pound. July CME lean hogs end down $0.125 to 87.850.

U.S. wheat rises for 2nd day; corn, soy steady
SINGAPORE, June 3 (Reuters) - U.S. wheat rose 0.6 percent on track for a second day of gains supported by doubts that exports from the Black Sea region can cover shortfalls expected from adverse weather hurting crop prospects in the United States, Europe and Canada.
"It is probably Russia, which is now talking about putting tariffs on exports to keep control over domestic prices," said Paul Deane, agricultural commodity strategist at ANZ.

Wheat Fields Wilt in Drought as Parched Earth Spreads From China to Kansas (Source: Bloomberg)
The worst droughts in decades are wilting wheat fields from China to the U.S. to the U.K., overwhelming Russia’s return to grain markets and driving prices to the highest levels since 2008. Parts of China, the biggest grower, had the least rain in a century, some European regions are the driest in 50 years and almost half the winter-wheat crop in the U.S., the largest exporter, is rated poor or worse. Inventory is dropping 8.8 percent, the most in five years, Rabobank International says. Prices will advance 20 percent to as high as $9.25 a bushel by Dec. 31, a Bloomberg survey of 14 analysts and traders shows.

Commodity Bubbles Caused by Speculators Need Intervention, UN Agency Says (Source: Bloomberg)
Commodity markets need international oversight, more transparency and intervention to deflate bubbles because increasing speculation means prices are no longer driven by supply and demand, the United Nations said. Increased investment in commodity markets has encouraged “herding behavior” and creates bubbles, the UN’s Conference on Trade and Development said in a report published today. Anticipation of the global economic recovery played a “disproportionate role” in higher commodity prices, it said.

Bangladesh grain imports to hit record 5.5 mln year to June
DHAKA, June 3 (Reuters) - Bangladesh's imports of wheat and rice are set to reach a record 5.5 million tonnes in the year to June, against 3.0 million tonnes in year ago, a senior food official said on Friday.
The previous highest import of grains was in 1998 when Bangladesh bought 5.4 million tonnes following a devastating flood that destroyed crops in the field.

Lifting Of Russian Grain Export Ban Seen Having Minimal Impact On Canada, US (Source: CME)
Russia is set to reopen its grain export market July 1, sparking fears that some business will be lost in Canada and the U.S., but the impact may be minimal as the country likely won't export large amounts. "Last year's crop was a historic disaster, and whatever [Russia] had left they had to keep for themselves," said Tim Hannagan of PFG Best in Chicago. He said the announcement is psychologically bearish to the market because it creates more competition for business in exporting countries like Canada and the U.S. However, he said he believes the worst of situation in terms of North American prices is over. "Russia said, 'Sure, we will go along with the World Trade Organization and open up our door, but it doesn't mean we are going to sell a whole lot,'" Hannagan said. "They still have to produce a large chunk of grain to replenish stocks after last year. They won't be a major supplier." Hannagan said the way it is looking right now, stocks will not be on the high end of the spectrum once again this year.
"This year's production [in Russia] has to be much better, but they are not off to a good start, like a lot of other areas," he said. "I wouldn't expect to see a lot of selling out of there." Wheat values on the Chicago Board of Trade lost nearly 8% during the first two trading days of the week, but Hannagan said that the fact dry areas of the U.S. and western Europe had received rains had just as big of a part to play in the decline as the opening of Russian exports did. Bruce Burnett with the Canadian Wheat Board said there wouldn't be too big of a drop in price, because the market had been expecting this to happen.

China drought raises questions about climate change
LAKE HONGHU, China June 3 (Reuters) - China's drought along its biggest river, the Yangtze, is for some scientists a demonstration of how global warming could increasingly disrupt the complex dance of air flows, rains and waterways that feeds dams and farming heartlands.
"I think there is a link to climate change," Liu told Reuters. "In recent years, the trend seems to be that China's south, which generally has abundant water, has experienced more drought and extremes in weather.

FOB Gulf Grain-Wheat premiums hold amid muted demand
CHICAGO, June 2 (Reuters) - Export premiums for U.S. wheat at the U.S. Gulf Coast were steady on Thursday amid slow farmer selling and limited export demand, traders said.
U.S. wheat to face stiff competition from less expensive wheat from the Black Sea region after Russia lifted its nearly year-old grain export ban.

Germany says may help Spain's farmers over E.coli
MADRID, June 2 (Reuters) - Germany will consider measures to compensate Spanish farmers for the loss of sales due to their produce being blamed for the outbreak of E.coli in Europe, a statement from Spain's presidential office said on Thursday.
German Chancellor Angela Merkel told Spanish Prime Minister Jose Luis Rodriguez Zapatero during a telephone conversation that she regretted the damage suffered by Spanish farmers and would seek a solution in accordance with European Union legislation, the statement said.

Killer E.coli strain described as deadliest yet
LONDON, June 3 (Reuters) - A virulent new strain of E.coli bacteria that has killed at least 17 people in Europe may be the deadliest yet in human history, health experts said.
Germany is at the centre of the outbreak, with more than 1,500 people ill from eating contaminated vegetables and salads, but the precise source of the new strain is not yet known.

Russia watchdog criticises EU over E.coli outbreak
MOSCOW, June 2 (Reuters) - Russia decided to ban imports of raw vegetables from the European Union because of inaction by EU regulators over a deadly E.coli outbreak, the head of Russia's consumer protection watchdog told Reuters.
"The kind of things that have been happening in the EU for a whole month do not even happen in African countries," Gennady Onishchenko, head of Rospotrebnadzor state agency, told Reuters by telephone.

U.S. wheat rebounds from early week declines
CHICAGO, June 2 (Reuters) - More rain forecast for spring wheat areas of the northern U.S. Plains, further delaying of this year's crop in key places such as North Dakota. Hot and dry weather in southern Plains to stress filling hard red winter wheat crop in southern Kansas.
Informa Economics estimated the 2011 U.S. winter wheat harvest at 1.421 billion bushels, the smallest in five years.

EU wheat firm on drought, Black Sea export doubts
MADRID, June 2 (Reuters) - Market activity in many countries was muted by the Ascension Day holiday.
"There's two questions we can't answer right now: what will be the impact of Russia (returning to export markets) and what will their crop be? Nothing is sure about their yields," a broker based in France said.
Formerly the world's third-largest wheat exporter, Russia announced at the weekend it would lift an export ban on July 1.

Drought grows more dire in Texas and Oklahoma
KANSAS CITY, Mo., June 2 (Reuters) - A devastating drought tightened its grip on Texas over the last week with more than half the state now suffering the most extreme level of drought measured by climatologists.
A report released Thursday from a consortium of national climate experts said over the last week, Texas saw the highest levels of drought - rated as "exceptional" - jump from 43.97 percent of the state to 50.65 percent of the state.

Duties Could Temper Impact Of Return Of Black Sea Grain (Source: CME)
Traders are becoming increasingly cautious over the size of exports from the Black Sea next season after the Central Bank of Russia proposed duties, and Ukraine downgraded its estimate for shipments. Central bank Chairman Sergei Ignatyev in Moscow proposed introducing a flexible system of duties, similar to those used for oil products, which can be adjusted every month depending on prices in international markets. Traders said any introduction of duties could curtail their competitiveness on the international market. One said his company is already using a more "conservative" purchasing strategy due to fears he won't be able to sell as much to international clients as originally hoped. Earlier this week Ignatyev said the resumption of grain exports, due to start July 1, poses the single greatest inflationary threat to Russia's economy. Annual inflation stood at 9.7% as of May 23 and rising prices are seen as a key issue in the elections due next year.
Prices for fourth-grade milling wheat in Russia's southern exporting region have jumped $25-$35 to $220.70 a metric ton, according to Moscow-based think tank SovEcon, in the six days since Prime Minister Vladimir Putin said the ban on exports would be lifted. The Economic Development Ministry said the duties would be economically justified. But ministry officials are saying that they don't expect the resumption of grain exports to result in prices shooting up further or remaining consistently elevated as in the wake of the drought last year. "If an export tax is established, it will dramatically decrease the interior prices, which is in accordance to government policy of keeping the food inflation under control," said a Swiss grain trader with operations in Russia. "If the prices are increased further by means of farmers synthetically holding back sales, we feel that export taxes could become a serious topic.
In other words, the more the farmers want 7000 rubles [a ton], the more likely they will get 5000 in the end." Initially buoyant hopes for Ukraine's exports were also tempered this when the Agriculture Ministry lowered its export estimate for 2011-12 to 15-18 million tons from 19-20 million tons in case this year's harvest proved smaller than expected. Meanwhile, ratings agency Fitch cautioned that export restrictions in Ukraine in the form of duties, currently set at 9% on the customs value, but not less than EUR17 per ton on wheat, means the Black Sea may not return to international markets with the force some buyers are expecting.
Exports from the region, traditionally some of the cheapest in the world, are particularly important this season as weather problems are expected to severely hurt output from Europe and the U.S. "The removal of the ban in Russia does not necessarily mean there will be sufficient supply to offset losses in Europe and the U.S.," said Pablo Mazzini, senior director in Fitch's European Corporates team. But an official at industry body the Russian Grain Union said he remains hopeful the government will allow the free-flow of exports from July due to almost record high ending stocks in 2010-11 of 15 million tons. He forecast Russian exports at 17-18 million tons during 2011-12. "We must export the extra grain in order to prevent the domestic market getting overstocked, which would destroy farmers' motivation," he said.

Informa sees US winter wheat crop at 1.421 bln bu
CHICAGO, June 2 (Reuters) - Analytical firm Informa Economics estimated U.S. winter wheat production for 2011 harvest at 1.421 billion bushels, down from the firm's May forecast of 1.441 billion, trade sources said Thursday.
By class, Informa pegged U.S. production of hard red winter wheat at 764 million bushels and soft red winter wheat at 422 million bushels.

Argentina Farmers Plow Forward With Winter Wheat Planting (Source: CME)
Argentina's farmers are making good progress with the 2011-12 winter wheat planting, taking advantage of moist soil conditions to get seeds into the ground. To date, 22.5% of the 4.95 million hectares seen going to wheat have been planted, up six percentage points from the same point last season, the Buenos Aires Cereals Exchange said in its weekly crop report. Planting in the northern fields is reaching its end, while recent showers have slowed planting in the center of the farm belt. Planting is set to kick off in the significant wheat areas at the south of Buenos Aires province with more rain expected over the next week which will continue to improve conditions, the exchange said. The government made its first forecast for wheat planting this week, pegging area at 5 million hectares, up from 4.4 million hectares planted last season. The Agriculture Ministry based its estimate on increased phosphorous imports.
From January to April, imports of this key fertilizer rose 65% on the year to 348,181 tons, the ministry said. Argentina is a major wheat producer, with last season's crop yielding 15 million metric tons. It is also a leading wheat exporter, with most shipments heading to neighboring Brazil. Meanwhile, the soy harvest is nearing completion, with 95.5% of the crop brought in from the fields so far, the exchange said. Production is seen at 49.2 million metric tons, the second largest crop on record. Argentina is the world's third largest soybean exporter and leads soymeal and soyoil shipments. The corn harvest is 73.7% complete, with production seen at 20 million metric tons, the exchange said. Argentina is the world's second largest corn exporter.

India's monsoon on track as weekly rains rise
NEW DELHI, June 2 (Reuters) - India's monsoon rains were 12 percent above normal in the week to June 1, the weather office said on Thursday, after hitting the southern coast two days ahead of expectations, with coffee and rubber crops potentially benefiting.
Weather department sources said they were still expecting normal progress for the monsoon.

ICE sugar, coffee up; steadies after choppy week
LONDON, June 3 (Reuters) - ICE sugar prices were higher in early trade as strong physical demand supported the market, while coffee also edged up, as the markets steadied after recent volatile sessions.
Below are highlights for the sugar, coffee and cocoa markets: ICE raw sugar futures rose as strong nearby demand, combined with port congestion at major exporters Brazil and Thailand, buoyed prices. The market has seen volatile trading this week with swings of over 3 percent in recent sessions.

Ukraine sugar output to jump in 2011 - producers
KIEV, June 2 (Reuters) - Ukraine's white sugar production is likely to jump by 40 percent to 2.1 million tonnes in 2011 after farmers boosted sugar beet sowing area, the head of national sugar union Ukrtsukor said on Thursday.
Mykola Yarchuk told reporters that farms had boosted the sowing area to 540,000 hectares this year from 480,000 in 2010.

India sugar falls for 2nd day runnning on weak demand
NEW DELHI, Jun 2 (Reuters) - India is likely to produce 24.2 million tonnes of sugar in 2010/11, higher than local demand of about 22-23 million tonnes.
The Indian government has approved exports of 339,187 tonnes of sugar as part of planned 500,000 tonnes of overseas sales, government sources said on Thursday.

Coffee faces greatest Brazil frost threat since 2000
BRASILIA/NEW YORK, June 3 (Reuters) - From droughts to floods to hurricanes, commodity traders have been roiled by a record dose of almost every variety of inclement weather under the sun, save one -- a coffee-curdling frost in Brazil.
But this year, just as global stocks of coffee beans dwindle to their lowest since records began, Brazil's number may be up.

Shell, Cosan Formally Launch Brazil Biofuels JV Raizen (Source: CME)
Royal Dutch Shell PLC's ambitious foray into renewable energy was formalized as the Anglo-Dutch major and Brazilian sugar and ethanol group Cosan Industria e Comercio SA put the seal on their $12 billion Raizen biofuels joint venture. Announced in February 2010, Raizen pairs the hydrocarbons giant with the world's biggest producer of ethanol from sugar cane in a move the companies said combines Shell's expertise and technology in advanced biofuels with Cosan's experience in the commercial production of low-carbon biofuels. "We are building a leading position in the most efficient ethanol-producing country in the world," said Shell Chief Executive Peter Voser. "Low-carbon, sustainable biofuels will be increasingly important in the global transport fuel mix." Earlier this year, the companies agreed that Cosan will keep its sugar retailing business separate from the ethanol venture. Shell said in August it will inject some $1.6 billion into the joint venture.
The joint venture starts off with a net debt of 4.94 billion Brazilian reals. Last month, the companies established an exchange rate of 1.6287 Brazilian reais per U.S. dollar, which will apply to payments to Shell and for investments by Cosan. The venture is still under review by Brazilian antitrust regulator Cade. Raizen will produce and sell over 2 billion liters a year of ethanol made from Brazilian sugar cane, the companies said, adding that it will distribute biofuels and over 20 billion liters of other industrial and transport fuels annually through a combined network of nearly 4,500 Shell-branded service stations.

China copper imports seen up as Shanghai stocks fall
HONG KONG, June 3 (Reuters) - Shanghai bonded warehouse copper fell more than a quarter from April as the arbitrage between Shanghai and LME prices improved and China's spot copper demand rose in May, which could drive up imports in June and July, traders and analysts said on Friday.
High bonded stocks have weighed on demand for spot imports from the world's top copper consumer this year. But the stocks may have fallen by about 200,000 tonnes from April to between 350,000 and 500,000 tonnes currently, traders and analysts estimated.

METALS-Copper cuts gains after weak U.S. data
LONDON, June 3 (Reuters) - Copper cut gains on Friday after U.S. payrolls data came in well below forecasts and fuelled concerns about the health of the U.S. economy.
Three-month copper on the London Metal Exchange  was at $8,960 a tonne at 1304 GMT from Thursday's close of $8,920.

PRECIOUS-Gold hits high as dollar falls after U.S. data
LONDON, June 3 (Reuters) - Gold hit session highs on Friday as the dollar tumbled on disappointment with a monthly jobs report from the United States, which showed the economy created far fewer jobs than expected.
Spot gold  touched a peak of $1,546.39 a troy ounce. It was bid at $1,544.20 at 1314 GMT from $1,532.55 an ounce late in New York on Thursday. The precious metal hit a record high of $1,575.79 on May 2.

20110606 1016 Soy Oil & Palm Oil Related News.

 Soy Oil chart reading : side way range bound little upside biased.

Reuters Survey :
Malaysia May 2011 Crude Palm Oil
- Exports seen up 5.1% at 1.4 million tonnes from May 2011
- Stocks seen up 11.3% at 1.86 million tonnes from May 2011
- Output seen up 11.1% at 1.7 million tonnes from May 2011 

Soybeans (Source: CME)
US soybean futures finish higher as traders worry rains will prevent farmers from planting, keeping inventories tight. Northern Plains states like North Dakota are expected to stay wet after weeks of delays to field work. "There's growing confidence that they're not going to get near the beans planted that the market had hoped," says Jim Gerlach, president of A/C Trading. Rising cash prices add support to futures as processors search for soy supplies, he notes. CBOT July soybeans rise 7 1/2c to $14.14 1/2 a bushel.

Soybean Meal/Oil (Source: CME)
US soy-product futures settle mixed, as soymeal rises with soybeans on supply concerns. Processors of the oilseed are paying higher prices for soy due to tight inventories. They crush soybeans to make soymeal, used for animal feed. "If you can't get the beans, then you can't make the meal," says Jim Gerlach, president of A/C Trading. Soyoil prices weaken as reserve supplies are more plentiful. CBOT July soymeal climbs $2.40 to $368.40/short ton, while July soyoil drops 0.18c to 58.73c/pound.

Poor Rapeseed Crop, China Demand To Hit EU Biofuel Refiners (Source: CME)
European Union biofuels refiners face sharp rises in the cost of oilseeds into next year as a slump in regional output and rising demand from China keep world supplies tight, analysts said. The European November rapeseed contract on the NYSE Liffe exchange has risen nearly 16% from the low of EUR410.50 a ton touched on May 6 as fears for the crop have increased. At 1210 GMT, it was up EUR1.75 on the day at EUR480.75/ton. Poor winter planting and the worst drought to hit Europe for decades are expected to cut Europe's rapeseed crop by 1.5 million metric tons to as little as 19 million tons in the 2011-12 season, said analyst David Eudall of the U.K.'s Home Grown Cereals Authority. In Germany, the EU's largest rapeseed grower, the harvest is expected to fall to 4.5-4.8 million tons this year as the dry weather takes its toll on already under-developed crops, said grain merchant Toepfer International.
Productivity in the region's other major agricultural powers is also expected to decline, with France's rapeseed yields forecast to fall 4.3% on year to 3.1 tons a hectare and the U.K.'s a whopping 8.1% to 3.2 tons/hectare, according to May estimates from the EU's crop monitoring body. The HGCA's Eudall said the fall in production is expected to hit the EU's biodiesel production hub Germany hardest. The country has a capacity of around five million tons a year--almost a quarter of the EU's 21.9 million-ton biodiesel sector--according to the EU biodiesel association EBB. "The majority of crop losses are being seen in Germany and what's made it worse is that last year there was a fire in one of their crushing plants which is expected to come back online," he said. Demand for biodiesel, which is blended with fossil fuels to create a more environmentally-friendly form of transport fuel, however, is expected to remain firm as EU regulations mandating the use of sustainable fuels come into force.
Refiners will have to boost imports to make up for the domestic shortfall, said Eudall. He forecast shipments from Australia will rise 800,000 tons on year to around two million tons, while Ukraine and Russia will also boost exports. Soyoil from the U.S. and Brazil could make up some of the deficit as well, which he said is expected to peak in early 2012. "It looks like we're going to need about 1.5 million tons in the first and second quarters of 2012," he said. Demand from China, however, is likely to create headaches for Europe's hard-pressed refiners.

Palm oil extends winning streak on demand, weather
KUALA LUMPUR, June 3 (Reuters) - Malaysian palm oil extended gains for a second day over concerns of adverse weather hurting the U.S. soy crop, which gets crushed into competing soyoil, and prospects of strong demand in the coming months.
"We are entering a weather market and with palm oil demand set to grow stronger, there is much price upside," said a trader with a foreign commodities brokerage in Kuala Lumpur.

China's soymeal exports rise, sells up to 80,000 T
SINGAPORE, June 3 (Reuters) - China has sold up to 80,000 tonnes of soymeal to Japan and Vietnam in deals signed in the last two weeks, about double the level shipped in April, as slow domestic demand prompts soybean processors to look for overseas markets, traders said.
"There is supply push in China. Indian prices are much higher and monsoon is likely to slow exports," said one executive with an international trading company in Singapore. "Given the situation in India and China, it makes sense for China to export."

Argentine April soy crushing up 0.8 pct yr/yr
BUENOS AIRES, June 2 (Reuters) - Argentina is the world's top supplier of soyoil and soymeal and the third-biggest exporter of unprocessed beans.
The Agriculture Ministry said that in the first four  months of the year Argentina processed 10.9 million tonnes of soybeans versus 8.5 million in the same period last year.

Soy crop gathered in Argentina's top growing areas
BUENOS AIRES, June 2 (Reuters) - Farmers in Argentina's main soy belt finished harvesting 2010/11 crops over the last week, leaving only a few areas in marginal growing areas to be cut, the Buenos Aires Grains Exchange said on Thursday.
The South American country is the world's No. 1 soymeal and soyoil exporter, as well as its third-biggest soybean supplier. The 2010/11 crop is expected to come in at 49.2 million tonnes, according to the exchange.