Tuesday, June 7, 2011

20110607 1827 FCPO EOD Daily Chart Study.

FCPO closed : 3354, changed : -34 points, volume : higher.
Bollinger band reading : correction range bound little upside biased.
MACD Histrogram : weakening, buyer closing position.
Support : 3350, 3300, 3270, 3250 level.
Resistance : 3420, 3450, 3470, 3500 level.
Comment :
FCPO closed recorded loss again with better volume transacted while soy oil overnight closed weaker and currently rebounding little higher.
Sentiment remained weak as concern over higher stock level and less encouraging enough export pressure price to moved south.
Daily chart formed a down bar candle with little lower shadow closed below middle Bollinger band after market opened little lower, fall downwards tested below support level and swing higher above opening price but selling pressure kick in again resulted price to closed lower.
Chart reading adjusted to suggesting a correction range bound little upside biased market development testing support and resistance level with MACD indicator almost having a negative cross down.
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.

20110607 1745 FKLI EOD Daily Chart Study.

FKLI closed : 1555.5 changed : +2 points, volume : higher.
Bollinger band reading : correction range bound upside biased.
MACD Histrogram : weakening, buyer reducing exposure.
Support : 1550, 1540, 1530, 1515 level.
Resistance : 1565, 1580, 1590, 1600 level.
Comment :
Resilience FKLI closed recorded small gain with improved volume changed hand doing 3.5 points premium compare to cash market that closed nearly unchanged and regional(Asia & European) trading mostly little higher having technical rebound after recent falls while last Friday U.S. market continue to closed weaker.
Daily chart formed an up bar candle with lower shadow nearer to middle Bollinger band level after market opened weaker below support level, tested lower and recovered upwards all the way registered gain and closed near the high of the day.
Market is likely to trade in correction range bound upside biased market development for the near term base on technical reading and possibly testing higher resistance level as market seems well supported today.
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.

20110607 1621 Global Market & Commodities Related News.

Euro ticks up, Aussie firm ahead of c.bank meetings
SINGAPORE, June 7 (Reuters) - The euro ticked up in Asia on Tuesday, steadying from a slide after the Eurogroup chairman said the common currency was overvalued, while the Australian dollar held firm ahead of a central bank meeting despite expectations that it will keep interest rates steady.
"Those comments (from Juncker) probably weighed on the euro at the margin. But the direction of a weaker dollar is pretty clear this point in time, so I'm expecting a bounce in the euro," said Richard Grace, chief currency strategist at Commonwealth Bank.

U.S. wheat, soy tick up after selloff; corn steady
SINGAPORE, June 7 (Reuters) - U.S. wheat edged higher on Tuesday, recovering from a three-week low, while corn was little changed as bargain-hunters and end-users stepped in following last session's steep losses, triggered by improved crop weather.
"Whenever there is price pull-back, it attracts some bargain hunting from countries that are suffering from tight supplies of grains," said Ker Chung Yang, analyst at Phillip Futures in Singapore.

USDA seen lowering US corn stocks; yields eyed
CHICAGO, June 6 (Reuters) - Near-record high corn prices have done little to slow demand for the golden grain from U.S. livestock feeders and ethanol producers -- a factor that should prompt the U.S. Agriculture Department to lower its forecast of U.S. old-crop corn inventories this week, analysts said.
USDA has projected U.S. corn ending stocks for the "old crop" 2010/11 marketing year at 730 million bushels, a 15-year low. The tightness has kept Chicago Board of Trade corn futures near an all-time high, set in April, of $7.83-3/4 a bushel.

US corn planting seen at 93 pct
CHICAGO, June 6 (Reuters) - Some dry and hot weather in the eastern Corn Belt likely allowed farmers to make progress on their much-delayed corn planting in the past week as they scramble to seed a final 13 million acres, analysts said.
The U.S. Agriculture Department's weekly crop progress report on Monday afternoon is expected to show that farmers had planted 93 percent of their anticipated corn acreage as of June 5, based on an average of estimates given by 10 analysts.

Vietnam June coffee loading to fall from May -trade
HANOI, June 7 (Reuters) - Vietnam's coffee export loading this month could fall to between 65,000 tonnes to 80,000 tonnes, or 1.08 million to 1.33 million bags, from an estimated shipment last month of 110,000 tonnes, traders said on Tuesday.
"High prices attracted a large volume of coffee earlier this year and the remaining stocks are not high," a trader at a European firm in Ho Chi Minh City said.

China suspends rapeseed oil auctions as it builds stocks
BEIJING, Jun 7 (Reuters) - China has suspended regular rapeseed oil auctions as Beijing shifts to stockpiling domestic rapeseed harvests to refill stocks, aiming to boost farmers' incomes.
The government did not announce via its website(www.grainmarket.com.cn) a date for rapeseed oil auctions due this week, while weekly auctions of corn and feed wheat will continue on Wednesday.

US corn plantings beat estimates, soy seedings lag
CHICAGO, June 6 (Reuters) - Warm and dry conditions provided a window for farmers in the eastern U.S. Corn Belt to catch up on corn plantings last week but seedings remained behind schedule, especially in Ohio where only about half of the crop was in the ground.
The U.S. Agriculture Department late on Monday put corn plantings at 94 percent complete, below the five-year average pace of 98 percent, leaving about 5.5 million acres (2.2 million hectares) of the projected 92.2 million yet to be seeding.

Argentine farmers finish harvest in soy belt- gov't
BUENOS AIRES, June 6 (Reuters) - Argentina's soy growers have finished bringing in 2010/11 beans in the main soy-farming belt, slowing corn gathering as they give the oilseed priority, the Agriculture Ministry said in its latest crop report.
Argentina is the world's No. 3 soy exporter. The government estimates the current crop at 50.4 million tonnes, only slightly down from last year's record 52.7 million tonnes despite dry weather early in the season.

Honduras 11/12 coffee exports rising, Guatemala flat
TEGUCIGALPA, June 6 (Reuters) - Honduras' coffee exports are expected to rise 5 percent in the upcoming 2011/12 harvesting season, which begins in October, while Guatemala's production for export will stay the same.
Honduras will export 4.1 million 60-kg bags of coffee next cycle, up from 3.9 million bags exported in the current 2010/11 coffee year, as farmers plant new areas and improve fertilization on farms, the national coffee organization IHCAFE told Reuters on Monday.

German shops near Polish border ration sugar
LONDON, June 6 (Reuters) - Some German supermarkets are rationing sugar to help cope with panic buying from customers from neighbouring Poland, where prices have soared on rumours of a shortage.
A spokesman for German retailer Metro AG  said a handful of its Real supermarkets near the border with Poland were limiting customers to eight bags of sugar each.

Brazil soy sales ahead of last year's - Celeres
BRASILIA, June 6 (Reuters) - Sales of Brazil's record 73.6 million-tonne soybean crop remained ahead of those completed by this time last year with prices stable as a stronger local currency offset higher rates in dollars, analysts Celeres said on Monday.
In its latest weekly report, Celeres said sales of the current crop that ended harvesting in May stood at 69 percent by June 3, up from 61 percent in the previous crop by this time last year. Sales of the crop were on par with historical averages, however.

Open weekend to plant crops in US Midwest, Plains
CHICAGO, June 6 (Reuters) - The U.S. Midwest and northern Plains benefited from mostly clear skies over the weekend, providing farmers a window to catch up on planting crops in the wettest areas of the crop belt, a forecaster said on Monday.
"It was relatively favorable planting weather over the weekend which will continue through Wednesday," said Telvent DTN forecaster Mike Palmerino referring to the Midwest Corn Belt. But rains start up again mid-week.

Rains and sun boost hopes for Ivorian cocoa crop
ABIDJAN, June 6 (Reuters) - Ivory Coast's cocoa growing regions received abundant rainfall mixed with periods of sunshine last week, raising expectations of an abundant mid-crop in the world's top grower, farmers and analysts said on Monday.
Ivorian cocoa arrivals to port are already running more than 15 percent higher than last year despite the effects of a four-month power struggle that killed thousands and left the economy in ruins, according to exporters.

Brent drops below $114 on expectations of OPEC target hike
PERTH, June 7 (Reuters) - Brent crude fell below $114 a barrel on Tuesday on expectations OPEC may raise its production target this week and lingering concerns that a weak economic outlook will dent demand.
"Slowly the market is turning the focus to the OPEC meeting and certainly a lot of the rumours around that meeting are that Saudi Arabia are lobbying quite hard for OPEC to increase their production quotas and that's exacerbating the downside for oil," Ben Westmore, a commodities analyst at National Australia Bank in Melbourne, said.

Copper falls; Chile strike cushions but econ anxiety grows
SINGAPORE, June 7 (Reuters) - London copper fell 0.5 percent on Tuesday and Shanghai futures also dropped after the market reopened following a three-day weekend, with bearish economic sentiment cushioned by a strike at Chile's fourth biggest copper mine.
"The risk off on the demand side after weak economic data is countering the more supportive influence from supply disruptions from Chile and potential pick up in demand from China."

Key Chile mine struggles for 3rd day due to strike
SANTIAGO, June 6 (Reuters) - The world's fifth largest copper mine, Chile's El Teniente, worked at less than half of capacity on Monday as most workers stayed home for a third day to avoid violence by striking contractors, owner state giant Codelco  said.
The mine slowed down operations late last week after temporary workers, on strike since May 25, threw stones at buses carrying workers to the mine. Police patrols escorted buses carrying a few hundred staff employees to the deposit on Sunday to work on a contingency plan that allows the 404,000 tonne-a-year mine to produce at 40 percent capacity.

Gold steady near 1-month top on economic concerns
SINGAPORE, June 7 (Reuters) - Gold steadied on Tuesday, after rising to its strongest in more than a month in the previous session as fears about a slowing U.S. economy prompted purchases from investors seeking an alternative investment.
"I think the odds are stacked in favour of gold at the moment," said Darren Heathcote, head of trading at Investec Australia in Sydney.

20110607 1204 Global Market & Commodities Related News.

GLOBAL MARKETS: Euro edges up, Aussie holds firm ahead of rates
SINGAPORE, June 7 (Reuters) - The euro edged up in early Asian trade, steadying from a slide in a relatively subdued session overnight after the Eurogroup chairman said the common currency was overvalued.
The Australian dollar held firm ahead of the Reserve Bank of Australia's interest rate decision due at 0430 GMT. Most economists polled by Reuters expect the central bank to hold rates at 4.75 percent.

OIL: Oil falls on OPEC hike possibility, demand concern
NEW YORK, June 6 (Reuters) - Oil fell on Monday in thin and choppy trading on raised expectations OPEC will raise production targets this week and concerns about the economic outlook.
"Today's lower (oil prices are) largely related to the usual bearish combo of stronger dollar and a soft stock market," Jim Ritterbusch, president at Ritterbusch & Associates in Galena, Illinois, said in a note.

NATURAL GAS: Chart buying, weather drives natgas to higher close
NEW YORK, June 6 (Reuters) - U.S. natural gas futures ended higher on Monday, backed by technical buying after last week's break of key resistance and forecasts for more heat this week that should boost demand from Texas to New York.
"There's near record heat across much of the South, but if the heat is transitory, prices will quickly come back down," a Texas-based trader said.

EURO COAL: Prices nudge higher by 75 cents
LONDON, June 6 (Reuters) - Prompt European coal prices rose slightly by around 75 U.S. cents a tonne on Monday as Germany's cabinet backed the nuclear exodus and South African exports showed a sharp fall.
"There's a lot of coal around for the next several weeks and although there is stockpile space for it and some German buying, it ought to be pushing prices lower," one European trader said.

COMMODITIES: Oil, grains fall on supply outlook, sector slumps
NEW YORK, June 6 (Reuters) - Oil on Monday posted its biggest daily drop in two weeks, on fear of OPEC production hikes, and grains prices hit multi-week lows as improved weather suggested fewer of the planting delays that had fueled last month's rally.
"There's a lot of little things adding up to a good down day in the market," said Tim Hannagan, agricultural analyst at PFG Best in Chicago.

Asian refiners plan to expand as fuel demand grows
KUALA LUMPUR, June 6 (Reuters) - Refineries from Malaysia, China to India are investing billions of dollars in a fresh wave of capacity expansion to feed rising regional demand, while counterparts in the U.S. and Europe restructure or shut plants as fuel sales slow.
Fast-growing Asian economies are driving global fuel demand growth, taking an increasing share of the oil market from developed economies.

20110607 0953 Global Economic Related News.

Hong Kong: Banks’ rate increases take steam out of housing boom
Hong Kong banks may have succeeded where the government failed as rising mortgage rates curb home price gains and cut sales to the lowest level in two years, signaling the property market may have peaked. HSBC Holdings Plc, which controls two of the city’s three-biggest banks by customers, is among lenders that accelerated mortgage rate increases in April as liquidity dried up. An index of home prices has stalled since 20 Mar, while the number of sales in April fell 37.6% from a year earlier to the lowest in more than two years, according to the Land Registry. The government has come under pressure to cool the property market, the world’s priciest according to Savills Plc, which had surged as much as 70% since the beginning of 2009 on record-low mortgage rates, an influx of buyers from other Chinese cities, and a lack of supply. (Bloomberg)

Australia: May construction index falls for 12th straight month
Australia’s building industry shrank for a 12th month in May as higher borrowing costs and consumer caution weighed on construction, a private survey showed. The construction performance index was 39.6 from 37.9 in April, marking a year since it was last in an expansion, according to a survey by the Australian Industry Group and the Housing Industry Association released in Sydney. A reading below 50 indicates the industry is contracting. Reserve Bank of Australia Governor Glenn Stevens will hold the benchmark interest rate at 4.75% today, according to a Bloomberg News survey of economists, after boosting borrowing costs seven times from October 2009 to November. A report last week showed the household savings ratio rose to 11.5% in the first quarter from 9.7% in the previous period, the highest level since 2009 as consumers exhibit greater restraint. (Bloomberg)

Australia: Annual inflation slowed in May as cheaper holiday travel and household appliances outweighed higher fruit and vegetable prices, a TD Securities Ltd. index showed. Consumer prices advanced 3.3% YoY in the 12 months through May after a 3.6% YoY gain a month earlier. They increased 0.2% MoM after a 0.3% MoM advance in April. (Source: Bloomberg)     

Spain: Industrial production contracted in April by the most in six months as the economy struggled to emerge from a three-year slump. Output at factories, refineries and mines declined 1.6% YoY, adjusting for the number of working days. Production fell 0.4% YoY in March, the institute said. Production of consumer durables, which include items such as washing machines, fell 11.4% YoY. (Source: Bloomberg)

EU: Regional fiscal revolt in Spain risks spreading
Catalonia’s refusal to meet Spain’s deficit target risks encouraging other regions to join in rebellion just as Prime Minister Jose Luis Rodriguez Zapatero’s authority may be weakened by the approach of general elections. Catalonia, Spain’s largest region with an economy the size of Portugal’s, plans a 2011 deficit twice as wide as its target, in a move Moody’s Investors Service said was “credit negative” for Spain. Zapatero will have to decide between allowing Catalonia to sell enough debt to fund the shortfall or antagonizing a state that has traditionally backed Socialists in national voting. The Catalan revolt may undermine Zapatero’s efforts to convince investors that his veto power over state bond sales gives him control over their budgets, which pay for half of Spain’s public workers. Still reeling from defeat in a local election campaign that may have further swelled regional budgets, the Socialists have to choose between fiscal discipline and voter support in the nine months until the general election. (Bloomberg)

EU: Producer-Price gains slow for first time in 8 months
European producer-price inflation slowed for the first time in eight months in April on weaker cost increases for intermediate goods as the European Central Bank prepares to keep interest rates on hold. Factory-gate prices in the euro region gained 6.7% from a year earlier after increasing a revised 6.8% in March, the European Union’s statistics office in Luxembourg said. That’s the first decline since August. Economists had projected an increase of 6.6% last month, according to the median of 21 estimates in a Bloomberg news survey. From the prior month, prices advanced 0.9% in April. Crude-oil prices have retreated 8.7% over the past two months to below USD100 a barrel, easing pressure on companies to pass on higher costs to protect earnings. With euro-area growth faltering and governments struggling to contain a debt crisis, the ECB has signaled it will keep its benchmark rate at 1.25% when Governing Council members meet on 9 June. (Bloomberg)

20110607 0950 Malaysia Corporate Related News.

KLCI chart reading :
correction range bound upside biased.

SP Setia and Ivory Properties in race to develop Bayan Mutiara land
It is learnt that SP Setia and Ivory Properties are the companies that have responded to the Penang state government's tender to develop the Bayan Mutiara land. The tender is part of the state government's efforts to raise funds. Sources said Ivory Properties had submitted the higher bid, for which the reserve price was reportedly set at RM200 per sq foot. The state government had asked for a request for proposal (RFP) to develop an initial 24.8ha, which is located south of the Penang Bridge and overlooking Pulau Jerejak. The RFP comes with the potential to develop an additional 14ha via a future reclamation after the development of the initial 24.8 ha. The deadline for the RFP of the project was set for 31 Dec 2010, it is learnt that the RFP had been recalled and interested parties were asked to re-submit their bids. (BT)

Khazanah said to list healthcare unit in 3 to 6 months
Khazanah plans to list its healthcare assets in three to six months, Singapore's Today newspaper reported without citing sources. According to the report, the offering is expected to raise more than SGD1bn (RM2.44bn) through the listing of its Parkway, Pantai and IMU units, which have all been placed under a new company called Parkway Pantai Ltd. (BT)

UEM still keen to sell its 45% stake in Time Engineering
UEM is still interested in selling its 45% stake in TIME Engineering worth approximately RM165m. Its MD-cum- CEO Datuk Izzadin Idris said it is evaluating all options, but has yet to receive any proposal. UEM has long mulled over divesting its TIME Engineering interest, which it sees as a non-core asset. (BT)

Sime budgets RM120m to RM130m per year for worker salary increases
In an unprecedented move, Sime Darby has increased the salaries of 37,000 of its estate and mill workers throughout the country, with each expected to earn an extra RM200 in basic salary effective 1 July. Sime has allocated RM120m to RM130m per year for this purpose. Sime will also gradually upgrade housing and other amenities for its plantation workers, with each estate allocated RM30m to RM35m. (Financial Daily)

Cyberjaya to see RM2.5bn development in 2011
Cyberview SB has RM2.52bn worth of developments in the pipeline in Cyberjaya for this year, which will be achieved through further land sales of enterprise, commercial, institutional and residential space. RM3.34bn was pumped into Cyberjaya last year via an influx of infrastructural and business investments, representing more than a third of the total investment value to date of RM9.25bn. (Malaysian Reserve)

MAS to review network after entry into alliance
Malaysia Airlines (MAS) will review its network following its entry into the oneworld alliance, the aviation alliance that includes British Airways and Qantas. MAS MD and CEO Tengku Datuk Seri Azmil Zahruddin said its planned entry into oneworld does not mean a termination of its current arrangements with non-oneworld airlines, although there will be a need to review it. It is due to fly as a member of Oneworld by 2013. (BT)

Aviation: Berjaya Air spreads its wings in JV deal with Lion Air. Berjaya Air Sdn Bhd, a subsidiary of Berjaya Land Bhd, has entered into a joint-venture (JV) agreement with PT Lion Mentari Airlines, the parent company of Indonesia's largest private carrier and Asia's first hybrid low-cost airline Lion Air, in a move to spread its wings into the lucrative Indonesian air travel market. (Source: The Malaysian Reserve)

20110607 0946 Global Market Related News.

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

Stocks, Commodities Drop on Economy (Source: Bloomberg)
Stocks retreated for a fourth day and oil declined below $100 a barrel amid concern the global economic recovery is faltering. Treasuries pared declines before the U.S. sells $66 billion of notes and bonds this week. The Standard & Poor’s 500 Index slid 1.1 percent to 1,286.17 at 4 p.m. in New York, its lowest level on a closing basis since March 18, and the Stoxx Europe 600 Index declined 0.6 percent. Oil retreated before OPEC ministers meet this week in Vienna. The yen climbed against all 16 major peers, adding 0.2 percent versus the dollar. Ten-year Treasury yields rose two basis points to 3.01 percent after climbing five points earlier.

Cooling U.S. employment casts shadow on recovery
WASHINGTON, June 3 (Reuters) - The U.S. economy may be in for a long period of soft growth after employers hired the fewest number of workers in eight months in May and the unemployment rate rose to 9.1 percent.
Nonfarm payrolls increased 54,000 last month, the Labor Department said on Friday, just over a third of what economists had expected.

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.

U.S. Stocks Decline as Banks Drop Amid Economic-Growth Concerns (Source: Bloomberg)
U.S. stocks fell for a fourth day amid concern economic growth is slowing and the Federal Reserve will boost capital requirements for the nation’s largest banks. Bank of America Corp. and Citigroup Inc. (C) slumped at least 3.9 percent. Wells Fargo & Co. (WFC), the largest U.S. home lender, retreated 2.2 percent after Rochdale Securities LLC’s Richard Bove cut his recommendation on the stock. Lowe’s Cos. declined 2.3 percent as JPMorgan Chase & Co. reduced its recommendation for the second-largest U.S. home-improvement retailer.

China Likely to Avoid Japan Growth-Policy Mistakes, Roach Says: Tom Keene (Source: Bloomberg)
China’s policy makers are positioned to extend the country’s rapid growth and avoid the mistakes made by Japan when its economy slowed in the 1990s, according to Morgan Stanley’s Stephen Roach.
“There are a lot of similarities: the export-led model, the currency suppression, the rapid buildup of foreign currency reserves, the industrial policy run by an elite,” said Roach, non-executive chairman of Morgan Stanley Asia Ltd. in New York, in a radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “The main difference for me is China has a strategy to change the model, Japan did not, and they have the commitment to implement that change and wherewithal to do it, and Japan did not, as well.”

Yen Is Near Month-High as Signs of Slowing Growth Boost Demand for Safety (Source: Bloomberg)
The yen traded within 0.2 percent of a one-month high against the dollar on speculation the global economic recovery is slowing, spurring demand for the Japanese currency as a refuge.

India Plans Biggest Highway Expansion With $12 Billion Projects (Source: Bloomberg)
India will award 550 billion rupees ($12 billion) of highway construction projects this year, its biggest expansion, as the nation aims to remove infrastructure bottlenecks that hinder economic growth. The 7,300 kilometer (4,536 miles)-project includes new expressways as well as widening of existing roads through the year ending March 31, J.N. Singh, finance chief of National Highways Authority of India, said in an interview in New Delhi. The state-run NHAI will pay for the acquisition of land required for the road construction, he said on June 2.

IMF Says U.K. Government Budget Cuts, Bank of England Policies Appropriate (Source: Bloomberg)
U.K. Prime Minister David Cameron ’s government should stick to its deficit-cutting plan as the current economic weakness is “temporary,” the International Monetary Fund said.

U.K. Retail Sales Fell in May on Job, Income Concerns, BRC Says (Source: Bloomberg)
U.K. retail sales fell in May as consumers’ uncertainty about their jobs and incomes increased, the British Retail Consortium said. Sales at stores open at least 12 months, measured by value, fell 2.1 percent from a year earlier, compared with a 5.2 percent increase in April that was spurred by spending over public holidays for Easter and the royal wedding, the London- based BRC said in an e-mailed statement today.

FOREX-Euro near 1-mth high vs dollar on rate outlook
LONDON, June 6 (Reuters) - The euro hovered near a one-month high against the dollar on Monday, boosted by progress over Greek debt financing and a potential widening of interest rate differentials, enticing hedge funds to buy the single currency.
The euro has jumped almost 4 percent in the past three weeks as Greece has inched closer to securing fresh aid to stave off the threat of a default.

Euro hovers near 1-mth high, stocks weaken
LONDON, June 6 (Reuters) - The euro hovered near a one-month high against the dollar boosted by expectations of a European Central Bank rate increase and a fresh Greek bailout deal, while U.S. growth concerns sent stocks tumbling. "We believe that the ECB is set to signal on Thursday that the next rate hike will be in July and this positive interest rate dynamic will continue to help the euro," said Elsa Lignos, currency strategist at RBC Capital Markets.

20110607 0943 Global Commodities Related News.

Corn (Source: CME)
US corn futures tumble on improved weather and broad-based commodity selling. Warm weather with rains forecast later in the week are good for the crop, most of which has now been planted after a long, soggy spring. "We're heading into summer, and the crop is in the ground and growing," says Chad Henderson, analyst with Prime Ag Consultants. Market will need more supportive weather news to drive higher, he says. Some traders see the drop as nothing more than a correction after recent strength. Wheat and soy also plunged. CBOT July corn ends down 22c $7.32 per bushel; Dec corn down 19 1/4c to $6.67.

Wheat (Source: CME)
US wheat futures finish sharply lower as improving weather conditions ease concerns about output. Beneficial rains fell in dry areas of Western Europe ahead of the upcoming harvest, while farmers in the US northern Plains are making "some progress" planting spring wheat, according to Telvent DTN, a private forecaster. Spillover pressure from steep losses in the corn and wheat markets adds pressure to wheat. CBOT July wheat falls 29 3/4c to $7.44/bushel; KCBT July loses 24 1/4c to $8.90 and MGE July slips 18 1/2c to $10.42.

Rice (Source: CME)
US rice futures end higher as worries about the domestic crop support prices even as other commodities tumble. Drought throughout southern growing areas is causing all sorts of problems for farmers, and mill operators are buying rice on the expectation prices could climb, the US Rice Producers Association says in a newsletter. An analyst adds the market could be supported by the outlook for the Thai market. July CBOT rice climbs 1.9% to $14.74 1/2 per hundredweight.

Funds Boost Bullish Commodity Bets Amid Improving Global Growth Prospects (Source: Bloomberg)
Funds boosted bets on rising commodity prices to the highest in four weeks, led by copper, amid signs that the global economic recovery will remain resilient and boost demand for raw materials. Speculators raised their net-long positions in 18 commodities by 7.3 percent to 1.26 million futures and options contracts in the week ended May 31, government data compiled by Bloomberg show. That’s the highest since May 3. Copper holdings more than doubled. A measure of bullish agriculture bets also climbed as adverse global weather curbed crop production.

U.S. corn farmers at crunch time on planting
CHICAGO, June 3 (Reuters) - U.S. farmers who lag planting corn due to a soggy spring will still opt to seed corn rather take than an insurance payout or plant soy if their farms usually run high yields, a University of Illinois economist said on Friday.
"Farms with higher expected yields will find planting corn more attractive than taking the prevented-planting payment," Gary Schnitkey, University of Illinois economist and crop insurance specialist, told the Reuters Ags Forum.

Soybeans, Corn Fall as Drier U.S. Weather to Aid Planting, Crop Conditions (Source: Bloomberg)
Soybeans fell the most in more than four weeks and corn dropped for a second session on speculation that drier, warmer weather last week allowed U.S. farmers to accelerate planting delayed by an unusually wet spring. Some muddy fields dried out enough to support planting machinery, said Drew Lerner, the president of World Weather Inc. Over the next two weeks, crops will get frequent rains that will aid germination and improve conditions of newly planted crops, Lerner said. The U.S. is the biggest grower and exporter of corn and soybeans.

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.

Drought-hit China provinces to get rain relief this week
BEIJING, June 6 (Reuters) - Several Chinese provinces that are enduring their worst drought in decades may be hit by thunderstorms and landslides in the next two days, local media said, although it was not clear how much relief it will provide to devastated crops and fish farms .
Rainfall of between 10-152 millimetres could hit China's parched central provinces of Hunan, Anhui and Jiangxi, the China News website reported, citing local weather reports.

Four suspected U.S. E.coli cases linked to Germany
ATLANTA, June 5 (Reuters) - The United States has stepped up surveillance of some imported fresh vegetables and raw salad greens, but there are no signs the U.S. food supply has been tainted by a deadly E.coli bacteria that has sickened thousands in Europe, officials said on Sunday.
The number of suspected U.S. cases involving the E.coli bacteria remained at four on Sunday, all of whom had recently visited Hamburg, Germany, officials said.

Governments should pop commodity bubbles-UN report
GENEVA, June 5 (Reuters) - Direct government intervention may be needed to burst bubbles in commodity markets inflated by a new herd of financial investors, a U.N. study found.
Excessive speculation has added around 20 percent to international oil prices, sending false signals to policy makers, said the report published on Sunday.

French 2011-12 Wheat Production Could Fall 10-15% On Drought-FEC (Source: CME)
French wheat production could fall by 10-15% in the 2011-12 crop year following France's worst drought on record, non-profit organization France Export Cereales said. "Concerning the impact of drought on production potential, there is no doubt that French wheat production will go down this year," Leandro Pierbattisti, FEC analyst, said. France's worst drought on record is set to weigh heavily on its wheat harvest, French Agriculture Minister Bruno Le Maire said last week, potentially denting global wheat supplies. However, "France, Germany and the U.K. all received welcomed rainfall over the weekend, with further rainfall due over the coming three days. Central and Eastern France are due further sustained showers," FC Stone commodity risk manager said in a report.
According to a report released by the French government weather agency Meteo France, the 2011 spring was both the warmest and the driest on record, with a higher average temperature and less rain than in 1976, the previous most severe drought since the agency began compiling the data. FEC estimates French wheat production for the 2010-11 crop year at 36.5 million metric tons.

Russia grain exports to restart in July-attache
WASHINGTON, June 3 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in Russia:
"The Russian government will not extend its grain export ban beyond July 1. Experts estimate Russia's grain export potential in 2011 at 13 to 15 million tonnes depending on the grain crop 2011."

US Grain Exports Expected To Drop As Foreign Output Rises (Source: CME)
U.S. grain exports are expected to fall in the year ahead as farmers around the world ramp up production to cash in on a global boom for crops. Prices for corn and wheat have surged since last summer, creating an incentive for farmers in South America and the former Soviet Union to ramp up plantings with an eye on exports. That means more competition for the U.S., the world's top grain exporter, which has seen its inventories depleted over the last year due to a surge in foreign demand. "When you get into high prices and ample stocks outside the U.S., U.S. exports tend to drop sharply," said Terry Reilly, grains analyst at Citigroup in Chicago. Foreign buyers are looking to other nations for supplies or producing more of their own grain. Yet a slowdown in export sales abroad isn't likely to undercut prices as U.S. inventories are expected to remain low and domestic demand from food processors, ethanol makers and livestock producers remains strong. Analysts warn it is still early.
Factors, from Russia putting new tariffs in place to China's harvest falling short of expectations, could cause U.S. export sales to pick up. Weakness in the U.S. dollar also could boost interest from foreign buyers. Citigroup projects U.S. wheat exports will drop 23.5% to 975 million bushels in the current crop year that began this month. Corn exports are projected to fall nearly 8% to 1.75 billion bushels in the coming crop year that starts in September. Those projections are more dramatic than the outlook of federal forecasters. The U.S. Department of Agriculture predicts corn exports will fall 5% to a nine-year low, while wheat exports will tumble 21%, yet still remain above levels in the 2009-2010 crop year. Pulling export buyers away from the U.S. is the return of Russia, once the world's third-largest grain exporter. Russia last week said it would resume exports July 1 after implementing a ban last August when a historic drought devastated its crops.
Russia could export as much as 13 million tons of wheat in the current marketing year, up from four million tons last year, Reilly said. That would account for 10% of global wheat exports, which the USDA projects at 127 million tons. Ukraine also is easing restrictions on grain exports amid expectations for a rebound in production after last summer's drought. The countries are expected to take business from the U.S. to countries in North Africa and Asia. Egypt, the world's top wheat importer, has already expressed interest in rekindling its relationship with Russia. Federal forecasters in a recent report wrote "export prospects are sharply diminished," citing increased competition as Black Sea production and exports rebound. As for corn, a large crop in Argentina, the world's second largest exporter of the grain, is expected to eat into U.S. business. The USDA projects Argentina's corn output will jump 18% from last year to a record 26 million tons and its exports will rise 24% to 18 million tons.

USDA: Russia 2010 Grain Losses May Be Overstated By 6 Mln Tons (Source: CME)
Russia may have more grain to export than expected after farmers and officials exaggerated losses by up to 6 million tons last summer, the U.S. Department of Agriculture's Moscow attache said. Many regions reported a total wipeout of crops last summer in a bid to get government compensation after the worst drought to hit the country in more than a century devastated Russia's harvest. But the USDA's attache said that in some regions yields may still have reached 0.2-0.3 tons of grain per hectare, meaning the 2010 harvest may have been 3-6 million tons more than the government figure of 61 million tons. "Analysts point out that reliable, unbiased data on grain production is still absent in Russia," the report said. Russian Prime Minister Vladimir Putin announced at the end of last month that Russia will allow grain exports as of July 1. The move has weighed on wheat prices as traders anticipated the arrival of some of the world's cheapest grain on the international market.
The USDA said analysts estimate Russia may export up to 3 million tons of the 2010 harvest and another 10 million-12 million tons from the upcoming 2011-12 harvest, depending on its size. Observers say the decision to export has been prompted by the need to empty much-needed storage space ahead of the 2011-12 harvest, which the government forecasts could reach 85 million-90 million tons.

UN Agency Urges Controls On Financial Investors In Commodity Markets (Source: CME)
An increase in financial investment in associated derivatives markets has had a significant impact on the prices of a wide range of commodities, and must be countered by regulatory action, including direct interventions in those markets, a United Nations agency said. Prices for many commodities have been rising since the mid-2000s, but volatility has also increased greatly. Much of the increase in prices appears to have been driven by fundamental factors such as rising demand from fast-growing developing economies and concerns about supply shortages linked to political changes in the Middle East. But politicians in some developing economies have argued that an increase in financial investment in commodity markets has exaggerated those moves, hitting poorer countries particularly hard.
French President Nicolas Sarkozy has put commodity prices at the top of the agenda of the Group of 20 industrialized and developing nations this year, and a number of international regulators are working on proposals to improve the workings of commodity derivatives markets. But some commodity producing countries, and governments in those nations in which commodity derivatives markets are based, are wary of an increase in regulation that, in their view, could further distort prices and affect commodity production. In a new report, the United Nations Conference on Trade and Development came down firmly on the side of those who argue financial investment has affected prices, and needs to be controlled. "Rising volumes of financial investments in commodity derivatives markets has encouraged herding behavior through which price determination in commodity markets increasingly follows the logic of financial investment rather than market fundamentals," UNCTAD said.
UNCTAD estimated that prior to the recent dip, "excessive speculation" had accounted for 20% of the price of crude oil. It noted that commodity prices have increasingly responded to the release of important economic data, such as U.S. unemployment figures. That was difficult to explain from the perspective of supply and demand, but suggested an increased correlation with the bond, equity and foreign exchange markets in which financial investors have traditionally traded. "For cocoa...there can hardly be any link between United States employment and world chocolate consumption," UNCTAD said. UNCTAD said that by pushing prices higher and increasing their volatility, the growing role of financial investors was distorting global economic policy making.

US, France Differ On Ways To Improve Global Food Security (Source: CME)
France and the U.S. remain at odds over two key G-20 proposals in a plan that France believes is necessary to prevent global food shortages and help farmers around the world produce more. After months of negotiations with countries in the Group of 20 largest industrialized and developing nations, French Agriculture Minister Bruno Le Maire said he has achieved a "consensus of necessity" from member countries that a new global food security plan is needed. After a meeting Friday between Le Maire and U.S. Agriculture Secretary Tom Vilsack, both officials said there were differences in methods, but unity in the goal to stabilize food supplies. The U.S. support of genetically modified plants as key in boosting crop yields and the French proposal to build and fill emergency stockpiles of food staples such as wheat, rice and corn in developing countries continue to split the two countries.
"We just want to build, wherever it's needed, emergency reserves in case there is a food crisis...anyplace in the world," Le Maire said in an interview. He said the proposal is to leave it up to the United Nation's World Food Program to decide where the reserves should be located and which commodities would be stockpiled. "There is the desire on the part of some nations to have physical reserves," Vilsack said. "Our view is that you don't need to do that if you have transparency and you know pretty much who is growing what and how the harvests are. You can figure out where the surpluses are and where the shortages are." Transparency by countries in how much food they are producing and storing is something that Le Maire and Vilsack agree on and both officials pointed to China as one of the most secretive. In that regard, Le Maire said, he has made much progress.
The French minister was in Beijing last week and it was there he said the Chinese promised they were developing a reporting and statistics system that would shed more light on what and how much the country is producing. Initially the Chinese simply said no to the idea, Le Maire said, but now it looks as if it could happen. He said he hopes to have an answer when the G-20 agriculture ministers meet in Paris on June 22 and 23. Another consensus between France and the U.S. is that the world needs to significantly boost agricultural production, but they differ on the use of biotechnology to achieve that increase. Vilsack stands firmly behind the role of genetically modified seeds play in helping farmers get higher yields from limited farm land, while Le Maire stressed that France remains unconvinced about the safety of engineered crops. France has made recent strides in accepting genetically modified crops, but continues to keep some barriers up.
In July last year France approved 38 varieties of genetically modified corn, but kept in place a ban on planting them, according to Paul Winters, a spokesman for the U.S.-based Biotech Industry Organization. Nearly all of the corn, soybeans and cotton planted in the U.S. are genetically modified. Le Maire, in a February address to the United Nations General Assembly, warned that the world's population will reach 9 billion by 2050 and to feed them "a 70% increase in agricultural production" will be needed.

EU To Hold Extraordinary Meeting On E Coli (Source: CME)
European farming ministers will hold emergency talks on an E. coli outbreak that has killed at least 22 people amid cross-border anger over devastation for vegetable producers. "It has been decided that the EU agriculture and food safety ministers will meet (Tuesday) at 2:00 pm (1200 GMT) in Luxembourg," 10 days earlier than planned, Marton Hajdu, spokesman for the European Union's current Hungarian chair, told AFP. All but one of the deaths occurred in Germany, the source of the enterohaemorrhagic E. coli (EHEC) outbreak which has affected 12 countries. The other victim died in Sweden. The bacteria has left some 2,000 people ill across Europe. The outbreak was originally but falsely blamed on Spanish cucumbers, and growers have seen their produce shunned, with Russia and Qatar among states that have applied temporary bans on fresh-produce exports.
And although sprouts from a German grower are now being tested, with results due today, Spanish government anger at Germany jumping to conclusions comes on top of mounting calls from German, Dutch, French, Belgian and Portuguese growers' organisations for compensation or emergency aid to the farming sector. The EU commissioner for agriculture, Dacian Ciolos, and the health commissioner, John Dalli, will each attend the meeting. "They will be taking stock of the situation of the EHEC outbreak--both from the market perspective and also food safety," Hajdu added. Cases of E. coli poisoning have been reported in more than 12 other countries, including Austria, Britain, the Czech Republic, Denmark, France, The Netherlands, Norway, Spain, Sweden, Switzerland and the United States. Each was related to German travel.
The World Health Organization has identified the bacteria as a rare E. coli strain never before connected to an outbreak of food poisoning and said to be extremely aggressive and resistant to antibiotics. Ciolos last week said "limited" emergency aid to farmers could be explored, and a European diplomat who did not want to be identified said states want concrete proposals from the Romanian.

Coffee, cocoa down, tight supplies white sugar
LONDON, June 6 (Reuters) - ICE arabica coffee and cocoa futures fell in early trade after poor jobs data fuelled fears of a slowdown in recovery of the U.S. economy, while sugar firmed, buoyed by tight supplies of white sugar. ICE raw sugar futures inched up in light volumes, underpinned by tight availability of refined sugar, combined with new-crop loading delays at ports in Brazil.

India's Maharashtra cuts 2010/11 sugar output f'cast
MUMBAI, June 6 (Reuters) - India's western Maharashtra state, the biggest sugar producer in the country, has revised downward its 2010/11 sugar output forecast to 9 million tonnes from the previous 9.1 million tonnes, said a senior state government official.
"Production of 9 million tonnes is possible in the current year. Many sugar mills were forced to close operations due to early arrival of monsoon rains," said the official at the state's sugar commissioner's office.

Czarnikow sees 10.3 mln t sugar surplus '11/12
LONDON, June 3 (Reuters) - Czarnikow on Friday forecast a global sugar surplus of 10.3 million tonnes in 2011/12, as growers increase plantings to take advantage of high prices, after a small deficit of 0.5 million tonnes in 2010/11.
"The 2011/12 season should deliver a sharp rise in global production as producers around the world respond to high sugar prices," the London-based merchant said.

India sugarcane, cotton acreage up in 2011
MUMBAI, Jun 3 (Reuters) - Farmers in India have planted sugarcane over 5 million hectares till date in the current kharif season, up from 4.8 million hectares last year, data from farm ministry showed.
Cotton has been sown in 1.48 million hectare as compared to 1.15 million hectares the year ago, farm ministry said in a statement.

Crude Declines for a Third Day on Speculation OPEC Will Increase Quotas (Source: Bloomberg)
Oil dropped for a third day in New York amid speculation OPEC may increase output quotas when it meets in Vienna tomorrow. Futures slipped as much as 0.4 percent today after falling to the lowest in two weeks yesterday. The Organization of Petroleum Exporting Countries may increase production limits, Barclays Plc said June 6. Prices also declined amid signs fuel demand is faltering along with economic growth.

South African Coal Has First Gain in Four Weeks on Increased China Buying (Source: Bloomberg)
Coal export prices gained for the first time in four weeks at South Africa’s Richards Bay terminal as China, the world’s biggest consumer of the fuel, accelerated buying in the face of power shortages. Prices at Richards Bay, the continent’s largest facility for shipping coal, rose 0.2 percent on average in the four days to June 3 to $118.49 a metric ton, according to data from Petersfield, England-based researcher IHS McCloskey. China boosted its coal imports 64 percent in the two months through April.

Protest hits Chile key copper mine for second day
SANTIAGO, June 5 (Reuters) - Chile's fourth biggest copper mine, Codelco's  El Teniente, was producing at less than half of capacity for a second day on Sunday after most staff workers stayed home to avoid violence by striking contractors, the company said.
El Teniente, which produces about 2.5 percent of the world's mined copper or 404,000 tons-a-year, continued to work with a skeleton staff to keep production at 40 percent of capacity by processing stocked material.

US copper premiums up on tight scrap, shipping costs
NEW YORK, June 3 (Reuters) - U.S. copper premiums crept higher this week, buoyed by rising shipping costs and a lack of available scrap metal, an issue that could keep primary cathode premiums on the rise in the months ahead.
"Premiums are moving slightly up because the freight rates are killing us," one Midwest dealer said.
"If you're going to any distance from the docks, you're probably anywhere from 5.5 to 7 cents per lb."

Iron Ore-Prices rise for first time since May, China on holiday
SINGAPORE, June 6 (Reuters) - Spot iron ore prices are set to regain more ground this week after rising for the first time in about a month on Friday as Chinese steel mills returned to the market to replenish run-down inventories.
Prices of the steelmaking ingredient had fallen to more than two-month lows before Friday's recovery on limited interest from top buyer China.

METALS-Copper firms on soft dollar, Chile strife
LONDON, June 6 (Reuters) - Copper gained on Monday, buoyed by a softer dollar following weak economic data out of the United States and output disruptions in producer Chile.
Three-month copper on the London Metal Exchange  traded at $9,166 a tonne by 0920 GMT from a close of $9,099 on Friday. There was no trade on the Shanghai Futures Exchange due to a one-day holiday in China.

PRECIOUS-Gold rises as dollar sags, US outlook clouds
LONDON, June 6 (Reuters) - Gold rose for a second day on Monday, drawing strength from investor concerns over the outlook for U.S. growth after Friday's surprisingly weak employment data and a decline in the dollar to one-month lows.
U.S. employers hired the fewest number of workers in eight months in May and the unemployment rate rose to 9.1 percent, stoking worries that economic growth may be faltering and supporting sentiment in gold, which is seen as a safe-haven investment during times of economic uncertainty.

20110607 0941 Soy Oil & Palm Oil Related News,

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

Soybeans (Source: CME)
US soybean futures pull back from strong gains last week in a sell-off driven by improving weather conditions. Traders expect a weekly USDA report today will show a significant advance in plantings from last week, with many predicting soybeans will be more than 70% planted. A week ago, 51% of the crop was in the ground. Report is "going to show one of its biggest jumps of the year" in soybean and corn planting, predicts Tim Hannagan, analyst for PFG Best. CBOT July soybeans drop 31 1/4c to $13.83 1/4 a bushel.

Soybean Meal/Oil (Source: CME)
US soy products futures finish sharply lower with soybeans as favorable weather increases optimism about the crop being planted across the Midwest. Traders expect farmers will make significant progress planting oilseeds, thanks to warmer conditions. They "entered today looking for a decent planting week to start," notes Tim Hannagan, analyst for PFG Best. Improved weather eases concerns about output that had been supporting the soy complex. CBOT July soymeal drops $9 to 359.40/short ton, while July soyoil loses 0.7c to 58.03c/pound.

Malaysia's May palm stocks seen climbing to 16-mth highs
KUALA LUMPUR, June 6 (Reuters) - Malaysian palm oil stocks likely soared to a 16-month high in May as strong production growth overtook a modest increase in exports, a Reuters survey showed on Monday.
Stocks in the world's No. 2 producer of the vegetable oil probably jumped 11.3 percent to 1.86 million tonnes, a level unseen since January 2010, a median survey of five plantation houses showed.

Palm oil flat as traders await data blizzard
JAKARTA, June 6 (Reuters) - Malaysian palm oil traded flat with China shut for a holiday and as investors stayed on the sidelines ahead of a flurry of data due at the end of the week. "A lot of players are staying on the sideline and volume is very small," said one trader. "Without direction from the Dalian, you see that crude oil hasn't changed much.

Ukraine 2011 rapeseed harvest may rise 8 pct
KIEV, June 6 (Reuters) - Ukraine is likely to increase its 2011 rapeseed harvest by about 8 percent to 1.59 million tonnes, analyst UkrAgroConsult said on Monday.
But the latest forecast is smaller than 2.06 million tonnes expected in March due to a smaller harvested area.

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.