Monday, September 12, 2011

20110912 1804 FCPO EOD Daily Chart Study.

FCPO closed : 3070, changed : +20 points, volume : lower.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : rising, buyer in little advantage.
Support : 3050, 3020, 2970, 2930 level.
Resistance : 3070, 3100, 3150, 3200 level.
Comment :
FCPO closed recorded small gain with slowing down volume traded while last Friday soy oil ended higher and currently trading firmer while crude oil currently trading lower.
Following higher soy oil price development, FCPO price also opened and moved higher but however price gain are limited after news on MPOB official reported a lower export, stock and production level while weaker export data released from ITS and SGS for the period of 1~10 Sep 2011. Market also awaits tonight USDA data on crop forecast for the month.
Reuters survey reported that India August palm imports seen up 8.7%, soy oil imports seen down 49.5% and total vegetable imports seen down 5.7% to 860,875 tonnes versus July 2011.
Daily chart formed an up doji bar candle positioned near upper Bollinger band level after market opened higher, traded side ways with boring 23 points range bound market to closed near the high of the day.
Chart reading remained suggesting a side way range bound market little upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110912 1729 FKLI EOD Daily Chart Study.


FKLI closed : 1435, changed : -25.5 points, volume : higher.
Bollinger band reading : side way range bound little downside biased.
MACD Histrogram : turned lower, seller returning.
Support : 1425, 1405, 1395, 1385 level.
Resistance : 1445, 1458, 1470, 1485 level.
Comment :
FKLI closed recorded huge losses with better volume changed hand doing 11 points discount compare to cash market that also ended lower. Last Friday U.S. market closed lower and Asia markets ended mostly lower while European markets currently trading significantly lower.
News on speculation that Germany is preparing for Greece to default resulted already negative development global markets to triggered massive selling pressure while news on no plan on stimulus measure from U.S. Federal Reserve plus President Obama jobs plan is highly unlikely to pass through Congress provides the addictive to the negative sentiment today.
Daily chart formed a down bar candle closed near lower Bollinger band level after market gap down and slide lower to closed near the low of the day.
Chart reading turned to suggesting side way range bound little downside biased development possibly testing lower support level but like it or not Greece development are purely a speculation awaits further official news confirmation from the European region.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20110912 1703 Regional Markets EOD Daily Chart Study.

DJIA chart reading : side way range bound little downside biased.
Hang Seng chart reading :  side way range bound little downside biased.
KLCI chart reading : side way range bound little downside biased.

20110912 1628 Global Market & Commodities Related News.

GLOBAL MARKETS-Asian stocks fall, dollar gains on Europe woes
SINGAPORE, Sept 12 (Reuters) - Asian stocks slid and the euro sank to a 10-year low against the yen, after the resignation of a top German European Central Bank board member cast further doubt on the region's ability to tackle its worsening sovereign debt crisis.  "People are quite nervous about Greece and other countries in the European area, so that is why investors are escaping to the dollar," said Tetsu Emori, a fund manager at Tokyo-based Astmax Co Ltd. "It's risk aversion."


European Stocks, U.S. Futures Drop; RBS, Barclays, Lloyds Slide (Bloomberg)
European and Asian stocks fell and U.S.-index futures retreated as speculation mounted that Germany is preparing for Greece to default. BNP Paribas SA, Societe Generale (GLE) SA and Credit Agricole SA (ACA) slid more than 9 percent after two people with knowledge of the matter said Moody’s Investors Service may cut the banks’ ratings because of their Greek holdings. Royal Bank of Scotland Group Plc (RBS) and Barclays Plc (BARC) fell at least 4 percent as Britain’s banking commission recommended firewalls around retail-bank operations that would cost as much as 7 billion pounds ($11 billion). The Stoxx Europe 600 Index lost 2.4 to 219.11 at 8:24 a.m. in London, plunging to its lowest level since July 2009. Futures contracts on the Standard & Poor’s 500 Index expiring in December retreated 1.7 percent and the MSCI Asia Pacific Index slid 2.3 percent.


FOREX-Euro slumps to 10-yr low vs yen as Greece worries mount
TOKYO, Sept 12 (Reuters) - The euro hit a six-month low against the U.S. dollar and a 10-year trough versus the yen, falling below key technical levels and option barriers on worries that the euro zone's support for Greece is wobbling and the country may be forced to default on its debt.
"The outlook for Greece is almost completely unknown. Support for the country appears to be shaking. The market is starting to think the worst could happen," said Katsunori Kitakura, chief dealer at Chuo Mitsui Trust and Banking.

Indonesia's refined palm oil tax redraws landscape
KUALA LUMPUR, Sept 9 (Reuters) - Lower taxes on refined edible oil exports from top crude palm oil producer Indonesia are set to boost cooking oil supplies in the region, eroding margins for rival Malaysia and making cargoes cheaper for Asian buyers.
For decades, refined, bleached and deodorised (RBD) palm olein used in cooking oil enjoyed premiums of 5-10 percent over crude palm oil futures  as No.2 producer Malaysia was the sole supplier with tax free exports and massive processing capacity.

China, India corn demand to lead to record prices
JAKARTA, Sept 9 (Reuters) - Chinese and Indian corn demand will help push benchmark prices to record levels above $8 a bushel before the year-end, a leading U.S. analyst said late on Thursday.
Strong demand from developing Asian countries like China, the world's second largest corn consumer, coupled with the hottest summer in over half a century in top producer the United States, are both bullish for corn prices, John Baize, president at John C. Baize and Associates, told Reuters.

China Aug commodity imports shows economy resilient
SHANGHAI, Sept 10 (Reuters) - China's key commodity imports, including crude oil, copper and iron ore, all climbed in August from the previous month, adding to evidence that demand in world's second-largest economy was still going strong despite the economic turmoil in the West.
The wave of buying of oil and industrial commodities suggests that Chinese companies remain confident about the domestic economy and that they would likely see any price corrections as a rare restocking opportunity -- a move which should offer strong support to commodity prices.

GRAINS-US wheat at 1-mth low, soy rises ahead of report
SINGAPORE, Sept 12 (Reuters) - U.S. wheat futures slid to a one-month low, falling for a fifth straight session amid broad weakness in global markets triggered by concerns over Europe's ability to tackle its worsening sovereign debt crisis.
"A strong report may see prices rebound, particularly given that drought conditions continue across the U.S. Great Plains, negatively impacting hard red winter wheat planting," Commonwealth Bank of Australia strategist Luke Mathews said in a report.

Vietnam may lower import barriers on corn, wheat-paper
HANOI, Sept 12 (Reuters) - Vietnam may lower the import duty on corn to 3 percent from 5 percent now and abolish the 5-percent import tax on wheat as it seeks to lower production costs for the feed industry, a state-run newspaper reported on Monday.
The Agriculture Ministry has proposed the tax measures and the Finance Ministry said it would seek opinions from related agencies in order to issue a directive for implementation within this month, the Vietnam Economic Times newspaper said.

Dryness starting to hurt Argentine wheat -gov't
BUENOS AIRES, Sept 9 (Reuters) - Rains are needed in much of Argentina's wheat belt to safeguard 2011/12 crops, especially in parts of the top growing province Buenos Aires, the Agriculture Ministry said on Friday.
The South American nation, a leading global wheat exporter, has yet to forecast 2011/12 output, but the U.S. Department of Agriculture (USDA) sees production dipping to 13.5 million tonnes from 15 million last season.

Brazil maintains 10/11 soy forecast at 75.3 mln T
SAO PAULO, Sept 9 (Reuters) - Brazil's 2010/2011 soy crop is expected to reach 75.3 million tonnes, government crop agency Conab said on Friday, in line with last month's forecast and on track to beat last season's record harvest.
Brazil, the world's second-largest producer and exporter of soy, brought in 68.7 million tonnes of soy last season.

Ukraine harvests 272,000 T maize Sept.9 - AgMin
KIEV, Sept 9 (Reuters) - Ukraine, which plans to boost its maize harvest to 18-20 million tonnes this year, threshed 272,000 tonnes of the commodity as of September 9, the Agriculture Ministry said on Friday.
The ministry gave no data for the same date in 2010 but said the maize yields rose to 4.76 tonne per hectare this year against 3.81 tonne a year ago.

India fluffs cotton policy, gives buyers an edge
MUMBAI, Sept 9 (Reuters) - India's fickle policy on cotton exports has hurt its role as a steady supplier of the fibre, and saddled its exporters with huge stocks they will have to sell on punitive delivery conditions at lower prices through next year.
Cotton users in Bangladesh, China and Pakistan will benefit, but exporters in India, which harvested a good crop in the year to September 2011, will still feel the pain of curbs lifted only in August, after prices halved from March highs.
 
Oil falls $1 as dollar gains, investors shun risk
SINGAPORE, Sept 12 (Reuters) - Oil fell by more than $1 as the dollar strengthened and investors shunned commodity risk because of Europe's deepening sovereign debt crisis, while economic gloom dampened the outlook for energy use.
"People are quite nervous about Greece and other countries in the European area, so that is why investors are escaping to the dollar," said Tetsu Emori, a fund manager at Tokyo-based Astmax Co Ltd. "It's risk aversion."  

Oil production restarts in Libya - interim PM
TRIPOLI, Sept 11 (Reuters) - Libya has started producing oil again, the country's interim prime minister said on Sunday, promising that more of it would come online in the "near future".    
"We started producing oil yesterday," Mahmoud Jibril told a news conference in Tripoli. He declined to say where or how much.

Japan Aug aluminium stocks hit over 2-year high
TOKYO, Sept 12 (Reuters) - Aluminium stocks held at three major Japanese ports at the end of August stood at their highest level since May 2009, boosted by the arrival of delayed shipments from July, an official at trading house Marubeni Corp  said on Monday.
Aluminium stocks at these ports rose by 37,700 tonnes or 18.5 percent to 241,200 tonnes as of the end of August from 203,500 tonnes a month earlier, said Marubeni, which collects data from the key ports of Yokohama, Nagoya and Osaka.

India's NALCO temporarily cuts daily output on power shortage
BHUBANESWAR, India, Sept 10 (Reuters) - Insufficient power supply has forced India's state-run National Aluminium Co Ltd (NALCO)  to cut it's daily aluminium output by about 6 per cent, a senior company official said on Saturday.
The disruption caused by a scarcity of coal however will not affect the company's quarterly or yearly output target although the production may decline slightly by around 2,100-2,400 tonnes for a month, said  A.K. Sharma, director (Production).

Aluminium consumers hold off 2012 buys on slowdown fears
LONDON, Sept 9 (Reuters) - The outlook for aluminium demand for the remainder of 2011 is shaky in the debt-troubled economies of the West, which has discouraged consumers from filling all their 2012 needs for now, participants at a recent conference said.
"I cannot imagine we will have a very soft landing, for the simple reason that the banks are sitting on a lot of liquidity that they don't lend any more," Constellium's Chief Executive Christel Bories told delegates to a Metal Bulletin aluminium conference in Paris.

Vietnam plans Nov alumina production start
HANOI, Sept 9 (Reuters) - Vietnam's first alumina refinery would start producing in November, after several delays, and sell an estimated 50,000 tonnes this year directly to clients without any tenders, the company operating the plant said on Friday.
Alumina output at the $460 million Tan Rai plant would rise to 350,000 tonnes next year, around half its projected annual capacity, said Chief Executive Officer Le Minh Chuan of Vietnam National Coal and Mineral Industries Group, adding that no tenders had been planned yet.

Codelco clients ask to cancel orders on global turmoil
SANTIAGO, Sept 11 (Reuters) - Chile's Codelco, the world's top copper producer, said some of its European and U.S. clients asked to cancel orders due to fears there will be less demand amid global financial turmoil, a newspaper reported on Sunday.
Codelco did not reveal the amount or value of the cancellations. The state company begins its sales season in October and local media say it has committed to selling 80 percent of its 2012 production.

China August copper imports at 340,398 tonnes
BEIJING, September 10 (Reuters) - China's imports of copper rose 11.0 percent to 340,398 tonnes in August from 306,626 tonnes in the previous month, data from the General Administration of Customs showed.
Copper imports to China, the world's leading copper and aluminium consumer, include anode, refined, alloy and semi-finished copper products.

China August iron ore imports at 59.09 mln T, up 8.3 pct
BEIJING, September 10 (Reuters) - China imported 59.09 million tonnes of iron ore in August, up 8.3 percent from the previous month, official data from China's customs authority showed.
Imports of steel products rose 8.9 percent to 1.35 million tonnes while exports fell 5.6 percent to 4.19 million tonnes.

Indonesia's Aug tin exports up 7.3 pct yr/yr
JAKARTA, Sept 12 (Reuters) - Indonesia's refined tin exports rose 7.3 percent in August from the same month last year, but were down 7.6 percent on the previous month, an official at the trade ministry said on Monday.
Indonesia, the world's top tin exporter, shipped 8,559.61 tonnes of refined tin in August, compared with 7,974.05 tonnes in August last year, trade ministry data showed. In July, tin exports stood at 9,265.72 tonnes.

METALS-London copper falls 1 pct on economic concerns
SINGAPORE, Sept 12 (Reuters) - London copper declined 1 percent, extending a fall of 3.2 percent in the previous session, as mounting worries about stalled economic growth in the West outweighed robust growth in China's copper imports.
"The euro cracked and risk has cracked," said a Singapore-based trader. "The foreign exchange market has taken a turn to the worse and base metals are going to be shattered today."

Gold demand to strengthen by end 2011-WGC
MILAN, Sept 9 (Reuters) - Gold demand which dropped in the second quarter of this year is expected to strengthen by the end of 2011, driven by robust jewellery consumption in India and China and recovery in investment demand, senior World Gold Council (WGC) officials said on Friday.
Overall gold demand fell 17 percent year-on-year in the three months from April to June to 919.8 tonnes as a sharp drop in investment demand offset a tentative recovery in jewellery buying, the gold mining industry-funded WGC said in August.

PRECIOUS-Gold extends losses on dollar, jewellers shop around
SINGAPORE, Sept 12 (Reuters) - Gold fell further after posting its worst closing since June last week but bargain hunters could cushion the fall, while escalating worries about Europe's ability to resolve its debt crisis sent bullion priced in euro to a record high.
"We still lean negative in our bias and expect a fall  toward $1,750 over the next week or so," said Tom Pawlicki, precious metals and energy analyst at MF Global.

20110912 1501 Global Market & Commodities Related News.

GLOBAL MARKETS-Asian stock fall, dollar firm on Europe woes
SINGAPORE, Sept 12 (Reuters) - Asian stocks fell and the euro remained under pressure on Monday after the resignation of a top German European Central Bank board member cast further doubt on Europe's ability to tackle its worsening sovereign debt crisis.
"People are quite nervous about Greece and other countries in the European area, so that is why investors are escaping to the dollar," said Tetsu Emori, a fund manager at Tokyo-based Astmax Co Ltd. "It's risk aversion."

Japan’s Nikkei 225 Falls to Lowest Since 2009 on Greece Default Concern (Bloomberg)
Japanese stocks fell for a second day, with the Nikkei 225 (NKY) Stock Average dropping to its lowest in almost two and a half years, as exporters and banks tumbled amid speculation Greece may be nearing default. Sony Corp. (6758), which gets 21 percent of its sales in Europe, fell 3.4 percent as the yen’s advance to a 10-year high against the euro dimmed the earnings outlook. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s biggest lender by market value, declined 2.7 percent on concern Europe’s debt crisis will hurt the global financial system. Sharp Corp. plunged 5 percent after Mizuho Securities Co. cut its target price on the maker of flat screens. The Nikkei 225 fell 2.3 percent to 8,535.67 in Tokyo, the lowest close since April 2009. The broader Topix slid 1.9 percent to 741.26 as speculation Germany is preparing for a Greek default spurred turmoil in equity markets worldwide.

Oil falls $1 as dollar gains, investors shun risk
SINGAPORE, Sept 12 (Reuters) - Oil fell by more than $1 on Monday with a stronger dollar as investors shunned commodity risk because of Europe's deepening sovereign debt crisis, while economic gloom dampened the outlook for energy use.
"People are quite nervous about Greece and other countries in the European area, so that is why investors are escaping to the dollar," said Tetsu Emori, a fund manager at Tokyo-based Astmax Co Ltd. "It's risk aversion."  

Oil production restarts in Libya - interim PM
TRIPOLI, Sept 11 (Reuters) - Libya has started producing oil again, the country's interim prime minister said on Sunday, promising that more of it would come online in the "near future".    
"We started producing oil yesterday," Mahmoud Jibril told a news conference in Tripoli. He declined to say where or how much.

Iraq oil min sees no problem with Shell gas deal
AMMAN, Sept 11 (Reuters) - Iraq's oil minister said on Sunday he saw no problem with the long-awaited $17 billion gas deal with Royal Dutch Shell  after the country's top energy committee sent the final draft agreement to the cabinet for approval.
Iraq's state-run South Gas Co (SGC) in July, in what was hailed as a breakthrough, initialled a final draft agreement with Shell and Japanese group Mitsubishi  to capture associated gas flared at three major southern oilfields.

Iraq oil minister sees lower output target
AMMAN, Sept 11 (Reuters) - Iraq's oil minister said on Sunday a production capacity target of 8.0-8.5 million barrel per day for contracts signed with international oil companies was "more suitable" than the current plateau target of 12 million bpd.
Abdul-Kareem Luaibi said the plateau production period for a series of deals signed with oil majors could be extended to 13 or 14 years rather than the current seven years, but no final decision has been made yet.

UAE Aug oil output rose to 2.6 mln bpd-source
DUBAI, Sept 11 (Reuters) - The United Arab Emirates (UAE) produced 2.6 million barrels per day (bpd) of oil in August, up from around 2.5 million bpd in July, a Gulf oil source told Reuters on Sunday.
Saudi Arabia and its Gulf allies, including the UAE, have raised their output since failing to convince other OPEC members in early June to agree a formal increase to help compensate for the shutdown of Libyan oil fields and meet demand.

S. Sudan to pay oil fees in arrears, eyes refineries
JUBA, Sept 9 (Reuters) - South Sudan will pay Khartoum in arrears for use of its oil facilities when the African Union decides on a rate as talks with Khartoum have failed, a government official said.
The new African nation is also considering building mobile refineries to overcome fuel and diesel shortages and is exploring for oil in the south east, said David Loro Gubek, undersecretary at the ministry of petroleum and mining.

NYMEX-Natural gas ends lower on day, up 1 pct for week
NEW YORK, Sept 9 (Reuters) - U.S. natural gas futures slid nearly 2 percent on Friday, pressured along with weaker crude futures by ongoing economic concerns.
"With the shoulder season right around the corner ... cooling demand will play a diminished role over the next several months. As such the only bullish driver that could possibly have a material impact on the supply and demand balance for natural gas will be a strong hurricane impacting production in the Gulf of Mexico, but much more severe than the loss of production experienced from Lee," Chirichella said.

Euro Coal-Prompt prices fall $3/T as buying halts
LONDON, Sept 9 (Reuters) - European prompt physical coal prices fell by around $3.00 a tonne on Friday as the limited utility and trade buying, which had been holding prices steady, vanished.
"Very prompt prices have dropped sharply, by over $3.00 since mid-week, because nobody wants coal so nearby and the usual buyer hasn't been much in evidence," one trader said.

COMMODITIES-Markets tumble as risk aversion boosts dollar
NEW YORK, Sept 9 (Reuters) - Copper prices tumbled their most in a month on Friday and oil fell too as investors fled risky assets and bought dollars due to mounting worries about the economies of the euro zone and the United States,
"Today's move is a vote of no confidence in the President's speech last night ... it's just triggering a risk-off mentality," said Steve Shafer, chief investment officer at hedge fund Covenant in Oklahoma City, which has about $300 million under management.

20110912 1120 Local & Global Economic Related News.

Bank Negara Malaysia's (BNM)  international reserves amounted to RM412.1bn (US$136.3bn) as at 29 Aug 2011, up from RM411.6bn (US$136.1bn) as at 15 Aug 2011. The reserves position was sufficient to finance 9.6 months of retained imports and was 4.5 times the short-term external debt. (BNM)

Industrial production index (IPI) declined 0.6% yoy in Jul (+1.3% in Jun) due to the decrease of mining index (-7.5%) and moderated manufacturing output (+1.5%). Electricity production increased 4.6% in Jul. Economists had projected the IPI would rise 2.4%. On a mom basis, IPI dropped 0.6% (+3.7% in Jun). In Jan-Jul, IPI rose 0.2%. (Bernama)

Manufacturing sales rose 10.8% yoy to RM50.4bn in Jul (+10.0% in Jun). On a mom basis, the sales value increased 1.7%. In Jan-Jul, it recorded a 10.8% growth to RM341.0bn.
• Total employees engaged in the manufacturing sector increased 3.4%  yoy to 1.02m in Jul (+4.3% in Jun).
• Total salaries and wages paid increased by 9.6% yoy to RM2.4bn in Jul (+11.6% in Jun).
• Average salaries & wages paid per employee rose 6.0% to RM2,354 in Jul (+7.0% in Jun).
• Productivity increased 7.2% yoy to RM49,393 in Jul  (+5.4% in Jun). (Department of Statistics)

External shocks from Europe's financial crisis and faltering U.S economy are expected to dampen Malaysia's trade momentum with grow anticipated to moderate between 7% and 8% this year (18.3% in 2010).  International Trade and Industry Minister Datuk Seri Mustapa Mohamed said if there were some improvement in the global economy then a 10-11% growth was doable. "But, for that we got to work extra hard on trade promotions," he said. (Bernama)

Malaysia's exports and imports are expected to grow moderately by 7.9% and 8.6% respectively this year (15.6% and 21.7% respectively in 2010), against the region's trade growth returning to historical rate of 10.0% (+18.3% in 2010). Although previously fueled by exports to the U.S. and the European Union, countries in Asia-Pacific, including Malaysia, are increasingly turning to the region itself as a source of demand for their goods and services, said the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
• "The growth of the services sector and intraregional trade are both factors that will allow the Asia-Pacific economies to continue to grow," said the Bangkok-based organisation in its Asia Pacific Trade and Investment Report 2011.
• However, exports would expand even further if Malaysia could diversify its capability to meet intra-regional demands from other major importers such as Australia, China, India, Indonesia, Russia and Turkey, it said. (Bernama)

G-7 Finance Chiefs Vow to Support Banks as Euro-Zone Crisis Roils Markets
Group of Seven finance chiefs vowed to support banks and buoy slowing economic growth as  Europe’s debt crisis roiled financial markets and threatened a global recession. Renewed fears that European policy makers are failing to prevent a Greek default and contain their debt woes last week prompted investors to sell stocks and push the euro to a six- month low against the dollar. (Bloomberg)


US STOCKS-Wall St tumbles as ECB discord stirs broad fears
US stocks tumbled more than 2% on Friday, 9 Sept after the top German official at the European Central Bank (ECB) resigned in protest of the bank's bond-buying program, which has been a major tool in fighting the region's debt crisis. The resignation of Juergen Stark from the ECB throws into question policymakers' ability to deal with Europe's debt crisis, a problem that could engulf a world economy already teetering on the brink of recession. The Dow Jones industrial average dropped 303.68 points, or 2.69%, to 10,992.13. The Standard & Poor's 500 Index dropped 31.67 points, or 2.67%, to 1,154.23. The Nasdaq Composite Index dropped 61.15 points, or 2.42%, to 2,467.99. (Financial Daily)

US: Obama channels economic frustration with USD447bn plan
President Barack Obama channeled the national frustration with the economy that threatens his political standing and challenged the US Congress to pass a USD447bn jobs plan tilted heavily toward the Republican prescription of tax cuts. The president, speaking before a joint session of Congress, demanded six times that lawmakers act “right away” on a plan that would boost spending on infrastructure, stem teacher layoffs and cut in half the payroll taxes paid by workers and small business owners.(Bloomberg)

U.S: Wholesale inventories rose more in July than a month earlier, boosted by automobiles and computer equipment, as sales stagnated. The 0.8% increase in inventories followed a 0.6% rise in June, Commerce Department figures showed in Washington. Sales were little changed in July. (Source: Bloomberg)

U.K: Producer prices increased the least in a year in August as a drop in energy costs eased pressure on manufacturers' margins. Prices charged at factory gates rose 0.1% from July, when they gained a revised 0.3%, the Office for National Statistics said. Input prices dropped 1.9% on the month, the most since April 2009. (Source: Bloomberg)

EU: Papandreou sets new taxes, cuts for Greece to skirt default
Prime Minister George Papandreou, vowing to avoid a default and keep Greece in the euro, approved new measures to help plug a yawning budget gap as resistance builds at home and in Europe to extending more aid to the European Union’s most-indebted nation. The Cabinet voted on Saturday to cut one month’s wages from all elected officials and impose an annual charge on all property for two years, to be levied through electricity bills to ensure rapid collection, Finance Minister Evangelos Venizelos told reporters in the northern Greek city of Thessaloniki. (Bloomberg)

Germany: Inflation slowed less than initially projected in August, as energy costs increased. The inflation rate, calculated using a harmonized European Union method, fell to 2.5% from 2.6 percent in July, the Federal Statistics Office in Wiesbaden said. From the previous month, prices remained unchanged. (Source: Bloomberg)

China: Money growth slows to 6-year low as tightening bites. New lending rose to CNY548.5b (USD85.9b) in August and money supply growth expanded at the slowest pace in at least six years. New local-currency lending compared with the CNY500b median estimate in a Bloomberg News Survey of 26 economists and CNY492.6b in July. M2, the broadest measure of money supply, rose 13.5%, the People's Bank of China said in a statement on its website. (Source: Bloomberg)

China: Shows resilience as imports, exports top expectations. Imports climbed to a record and exports grew more than expected last month, indicating resilience in the world's second-biggest economy as the U.S. and European recoveries falter. Inbound shipments jumped 30.2% from a year earlier to USD155.6b, the customs bureau said on its website. Exports climbed a more-than-expected 24.5%, leaving a trade surplus of USD17.76b. (Source: Bloomberg)

China: China hard landing ’distant scenario’ as data signal strength
China’s record imports and a rebound in lending signaled strength in demand that offers a bright spot in a global economy contending with Europe’s debt crisis and weakening US job gains. Shipments from abroad jumped 30% and new local- currency loans were a more-than-forecast RMB548.5bn (USD86bn), government reports in the past two days showed. At the same time, August figures released on 9 Sept indicated that policy makers have made progress in stemming inflation, which eased from a three year high, to a 6.2% year-on-year pace. (Bloomberg)

Japan: Economy contracted more than the government initially estimated in the second quarter as capital spending decreased, adding to concern the stronger yen may derail the nation's recovery from the March earthquake. GDP shrank at an annualized 2.1% rate in the three months ended June 30, more than the 1.3% contraction reported last month, the Cabinet Office said. (Source: Bloomberg)

Japan: Toyota losing no. 1 makes Prius priority to escape fading Japan
Two weeks after Japan’s 11 March earthquake knocked out more than 650 of Toyota Motor Corp.’s suppliers, halting worldwide production, the automaker had to decide where to focus its resources. It picked the Prius. By choosing the Prius ahead of the Corolla and Camry sedans that enabled Toyota to become global No. 1 by 2008, President Akio Toyoda is staking the future of Japan Inc. on hybrid technology as the solution to the nation’s worst disaster since World War II and the company’s initial indifference to customer complaints that prompted its biggest recall. (Bloomberg)

Canada: Canadian employment falls for first time in five months
Canada unexpectedly lost jobs for the first time in five months in August, led by goods-producing industries such as construction and natural resources. Employment fell by 5,500 after rising by 7,100 in the previous month, Statistics Canada said in Ottawa, and the jobless rate rose to 7.3% from July’s 7.2%, which was the lowest since December 2008. Bloomberg News surveys called for job gains of 21,500 and unemployment to stay at 7.2%. (Bloomberg)

Egypt: Israel feeling more isolated amid shifts in Mideast
With its embassy in Cairo ransacked, its ambassador to Turkey expelled and the Palestinians seeking statehood recognition at the United Nations, Israel has found itself increasingly isolated and grappling with a radically transformed Middle East where it believes its options are limited and poor. The diplomatic crisis – it which winds unleashed by the Arab Spring are now casting a chill over the region – was crystallized by the scene of Israeli military jets sweeping into Cairo at dawn Saturday to evacuate diplomats after the Israeli Embassy had been besieged by thousands of protestors. (Malaysian Reserve)

Australia: Australia jobs data underestimate demand for workers
Australia’s rise in unemployment last month doesn’t fully reflect the demand for workers in an economy that “continues to outperform” the US and Europe, Treasurer Wayne Swan said. Australia’s jobless rate jumped to a 10-month high of 5.3% in August, the second straight monthly rise, according to a government report on 8 Sept. Prime Minister Julia Gillard’s administration is trying to counter declines in consumer and business sentiment that last month helped lift the ranks of the jobless to 636,800, the most since October. (Bloomberg)

20110912 1119 Malaysia Corporate Related News.

Sime: Open to GO for E&O. Sime Darby Bhd is open to increase its stake and make a general offer (GO) for Eastern & Oriental Bhd (E&O) shares at the right time, having recently purchased a 30% stake in the latter at RM2.30 per share, said its president and group CEO Datuk Mohd Bakke Salleh. (Source: The Star)

CIMB: Nazir reorganizes CIMB. CIMB Group Holdings Bhd has embarked on its biggest reorganization since a restructuring in 2005 gave birth to the second largest banking group in the country. After the exercise, CIMBs group management committee will be trimmed to 15 people from 21. Datuk Seri Nazir Razak will hold dual functions as group CEO and head of Malaysian consumer bank. Meanwhile, Datuk Charon Wardini Mokhzani will be designated as CEO of CIMB Investment Bank Bhd. (Source: The Edge Financial Weekly)

UEM Land: 5 biotech proposals. Malaysian Biotechnology Corp says five more foreign biotech companies are planning to invest millions of ringgit at BioXCell@Nusajaya. One of them is Indias Biotech giant, Biocon Ltd that will be setting up a RM500m plant in BioXCell. UEM Land holds 40% equity in Malaysian BioXCell with remaining 60% held by Biotech Corp. (Source: The Star)

O&G: Gas Malaysia guarantees dividends in first two years, IPO set at RM2.20/sh. Gas Malaysia Bhd will pay a guaranteed dividend of 100% and 75% in the first two years, respectively, after floating its shares on Bursa Malaysia in December this year. Separately, Gas Malaysia shares will be sold at an indicative offer price of RM2.20 a share to prospective investors. (Source: The Star, The Malaysian Reserve)

Construction: Works Ministry to discuss Bumi contracts with Prasarana. The Works Ministry will hold discussions with Syarikat Prasarana Negara Bhd to identify job scope and contracts worth RM8b to be distributed to Bumiputera contractors via the implementation of the Sg-Buloh-Kajang stretch of the Mass Rapid Transit (MRT) system. (Source: Bernama)

Volkswagen to assemble Passat, Polo in Pahang
Volkswagen AG, Europe’s largest car manufacturer, will assemble Passat and Polo models at DRB-HICOM Bhd’s plant in Pekan, Pahang. “The assembly of our Passat and Polo models in Pekan will make Volkswagen cars more price competitive and appealing to Malaysians,” said Volkswagen Group Malaysia managing director Ricky Tay. When asked on the sales performance of Volkswagen cars in Malaysia, Tay replied, “As at end-August we sold some 3,500 units.” “Last year, our car sales was 0.2% of the total industry volume. As at June 2011, it had risen to 1.4%,” he said. “Our long-term goal is to capture 10% of Malaysia’s car market.”(BT)

Utusan to develop its plot of land in KL
Utusan Melayu wholly-owned unit, Juasa Holdings SB, has gone into a joint-venture agreement with Insan Tiara SB, to develop an eight-storey building with sub-basement and two floors of car park on a plot of land in Kuala Lumpur. The proposed project will help it gain rental income from the property, the media house said in a filing to Bursa Malaysia last Friday. The construction costs will be fully borne by Insan Tiara. The market value of the property together with land alienated for the road reserve to be developed is estimated to be RM6.8m. (Malaysian Reserve)

MAHB puts off new rates on govt advice
Malaysia Airports Holdings Bhd (MAHB) has put on hold the proposed implementation of new rates for the international passenger service charge and also aircraft landing and parking charges. MAHB said on Friday, 9 Sept, it was advised by the Transport Ministry that the charges, which were to be implemented on 15 Sept, “be put on hold until further review by the government”. (Financial Daily)


Prime Minister Datuk Seri Najib Razak has called on telecom companies to rethink their move to impose a 6% service tax on all prepaid sales, calling the levy “difficult to accept” given rising cost of living.
• “The reaction and feedback from the public is that the move by telcos is... unpopular and difficult to accept."
• He also denied that the telcos have sought finance ministry approval as “the decision was made by the telcos themselves.”
• The 6% was announced yesterday in a joint statement by the telecommunication players, who insisted that it was not a new tax but had been absorbed by telcos since it was introduced in 1998. (The Malaysian Insider)

Perodua expects the  new Myvi 1.5 to contribute to about half of the monthly sales of 8,000 units of the Myvi model. The new Myvi 1.5 will be available at all 178 Perodua showroom nationwide from Sept 15, said Managing Director Datuk Aminar Rashid Salleh. "This new 1.5 Myvi is currently exclusive to the Malaysian market and is aimed at young and urban executives who want a car which is sporty and premium," he added. (Bernama, BT)

Petronas will soon unveil a strategic tie-up with a British sports-car maker as it ramps up its lubricants and other fluid business to become one of the world's top five players by 2016. Petronas has also approved a RM209m budget to set up a new R&D centre at its lubricant manufacturing facility in Italy. The centre is expected to be ready by 2015 and will be one of Europe's largest, if not the largest. (BT)

Volvo Malaysia has appointed Mansoor Ahmed as managing director,  taking over from Eric Leblanc. Prior to the appointment, Mansoor was vice-president of vehicle sales and marketing of Asia trucks operations, based in Beijing, China. Volvo said Mansoor has over 25 years' experience in the car industry. He joined Volvo Group in India in 1997. He had earlier worked with Tata Motors for 12 years. (Bernama)

MalaysianBiotechnologyCorp (BiotechCorp) says five more foreign biotechnology companies are planning to invest millions of ringgit at  BioXcell at Nusajaya. The development of facilities at BioXCell and the investments from companies will add up to RM10bn.
• BioXCell, a biotech park on 32.37ha in SiLC is being developed by Malaysian BioXCell of which  UEM Land holds 40% equity with the remaining 60% held by Biotech Corp. (Star Biz)

Laos, Thailand to boost Maybank’s regional foothold
Malayan Banking Bhd (Maybank), which launched its refreshed logo yesterday, is implementing plans to become a regional player with the latest expansion in Laos and Thailand. Maybank president and chief executive officer Datuk Seri Abdul Wahid Omar said Maybank has applied for a banking licence in Laos and hopes to open the first branch next year. The country's largest banking group already has two branches in Vietnam and a 20 per cent stake in An Binh Bank. "We plan to expand retail banking in Thailand, but we are already the number one brokerage there via Kim Eng (Holdings Ltd)," he told a news conference after the launch of Maybank's new logo by Prime Minister Datuk Seri Najib Razak yesterday. (Source: Business Times)

K-Euro sews up WCE deal, finally
K-Euro is close to signing a concession agreement with the government to build and operate the RM6b West Coast Expressway. The financial close for the highway is expected to be completed by next month. It is learnt that K-Euro, in which construction giant IJM Corp. has a 22.72% stake, has finally agreed on the alignment of the highway with the Perak and Selangor governments, which has cleared  the path for the dealing of the deal. (Source: The Edge)

Syabas seeks RM1.05b from Selangor government
Syarikat Air Selangor Sdn Bhd has filed a statement of claim for RM1.054 billion on the Selangor government as compensation under the terms of the concession agreement. PUNCAK NIAGA HOLDINGS BHD said on Friday, Sept 9 the compensation was due to it from Jan 1, 2009 to March 31, 2011 under the concession agreement dated Dec 15, 2004. The agreement was between Syabas, the Federal Government and the Selangor Government. It said Syabas was seeking a declaration that RM1.054 billion was due and owing from the Selangor government from January 2009 to March 2011. (Source: The Edge)

Rozali denies Puncak takeover
IMDB is looking into a partial privatisation of Indah Water Konsortium. Puncak Niaga Holdings Bhd executive chairman Tan Sri Rozali, however, denies that Puncak is also a takeover target. An online news portal reported that both IWK and Puncak Niaga would be taken by IMDB and that the takeover had received the blessings of the National Economic Advisory Council, which is chaired by Prime Minister Datuk Seri Najib Razak. (Source: The Edge)

Gas Malaysia gurantees dividends in first 2 years
Gas Malaysia Bhd will pay a guaranteed dividend of 100 per cent  and 75 per cent in the first two years, respectively, after floating its shares on Bursa Malaysia in December this year. MMC Corp Bhd group managing director, Datuk Hasni Harun said Gas Malaysia is on track for a listing as part of MMC's strategy of unlocking value and reducing debt. "The dividends are also to reward shareholders' loyalty over the years," Hasni told Business Times in an interview last Friday in conjunction with MMC's 100-year anniversary. (Source: Business Times)

Hunza to pay out RM10m for late delivery of condos
Hunza Properties Bhd will pay out RM10m compensation to about 100 buyers of units at its Gurney Paragon condominium due to late delivery. The project located in Gurney Drive in Penang has a gross development value (GDV) of RM480m and is part of the 4ha Gurney Paragon, a mixed development project comprising a shopping mall and the condominium. The 100 odd buyers had signed the sales and purchase agreements in stages from June 2007 when the project was launched. Completion was supposed to have been by June 2010. Datuk Khor Teng Tong, group executive chairman, said the completion was delayed due to reasons beyond Hunza’s control. A stop work order was issued by the Penang Island Municipal Council (MPPP) when an access road next to the project caved in. The certificate of occupation was finally obtained in June this year.
At a recent press briefing to announce Hunza’s results for FY11 ending June 30, Khor said more than 70% of the 220 units have been taken up, half by foreigners mostly from  Singapore, Hong Kong, hanghai and Indonesia. (The Edge Property)

Johore Tin wants in on fast-growing dairy industry
Tin can manufacturer Johore Tin Bhd (JTB) has witnessed the growth of its customers involved in dairy products, in particular the condensed milk segment. Last month (JTB) announced a proposed acquisition of its customer, Able Dairies Sdn Bhd, a company involved in the business of manufacturing and selling ofmk and dairy products, for RM31m (RM27m in cash and RM4m in JTB shares). (The Edge)

Tatt Giap unit to venture into steel fittings
Tatt Giap Group Bhd’s unit is acquiring a total of  5.1 ha of land in Seberang Perai, Penang for RM18.80m to expand its pipes production and also venture into stainless steel fittings. Its unit Superinox Pipe Industry Sdn. Bhd had signed an agreement to acquire two plots of land 2.01 ha and 3.09 ha with the office block and double storey factory buildings from GUH Electrical Appliances Sdn Bhd. The proposed acquisition is to cater for future expansion of stainless steel industrial pipes and venture into new business activity – manufacturing of stainless steel fittings. Tatt Giap said Superinox  would finance the acquisition from its own funds (10%) and bank borrowings (90%). (The Edge)

Indah Water Konsortium To Merge With Government Subsidiary Company
The government has decided to merge national sewerage company, Indah Water Konsortium, (IWK) with a government subsidiary company, said Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah. The decision was made recently by the National Economic Council. The move is an effort to strengthen both entities which is owned by the government. The biggest asset owned by IWK can be redeveloped and benefit the merged entity. IWK was expected to be privatised soon to a consortium led by strategic investment agency, 1MDB. (Bernama)

20110912 1103 Global Market Related News.

Asia Stocks Fall on Concern Greece May Default; Cochlear Tumbles (Source: Bloomberg)
Asian stocks fell, with the benchmark index heading to its lowest level in more than three weeks, amid speculation Greece may be nearing a default on its sovereign debt, bolstering concern that the crisis will spread to the banking system. Commonwealth Bank of Australia, the nation’s largest lender by market value, retreated 3.3 percent. Toyota Motor Corp., the world’s biggest carmaker, dropped 2.4 percent in Tokyo. HSBC Holdings Plc, Europe’s largest lender by market value, lost 4.4 percent in Hong Kong. BHP Billiton Ltd. (BHP), the world’s largest mining company, sank 2.9 percent in Sydney after oil and metal prices dropped. Cochlear Ltd. tumbled 22 percent after the company announced a product recall.
The MSCI Asia Pacific Index fell 1.7 percent to 118.68 at 10:40 a.m. in Tokyo, headed to its lowest close since Aug. 22. The gauge slumped 8.6 percent last month, the most since May 2010, amid concern global economic growth is slowing as Europe’s sovereign-debt crisis spreads and after Standard & Poor’s cut the U.S. credit rating.

G-7 Finance Chiefs Vow to Support Banks as Euro-Zone Crisis Roils Markets (Source: Bloomberg)
Group of Seven finance chiefs vowed to support banks and buoy slowing economic growth as Europe’s debt crisis roiled financial markets and threatened a global recession. “We will take all necessary actions to ensure the resilience of banking systems and financial markets,” G-7 finance ministers and central bankers said in a statement released during weekend talks in Marseille, France. “Concerns over the pace and future of the recovery underscore the need for a concerted effort at a global level in support of strong, sustainable and balanced growth.” Renewed fears that European policy makers are failing to prevent a Greek default and contain their debt woes last week prompted investors to sell stocks and push the euro to a six- month low against the dollar. European bank and sovereign credit risk reached all-time highs as 10-year Treasury and German bund yields fell to record lows on demand for a haven.

Retail Sales in U.S. Probably Slowed on Limited Growth for Jobs, Incomes (Source: Bloomberg)
U.S. retail sales rose in August at the slowest pace in three months, tempered by limited job and income growth, economists said before a report this week. The projected 0.2 percent gain would follow a 0.5 percent increase in July, according to the median forecast in a Bloomberg News survey ahead of Commerce Department figures on Sept. 14. Production slowed in August and inflation cooled from the previous month, other reports may show. Retailers J.C. Penney Co. and Target Corp. (TGT) say sales gains are more difficult because of a stagnant labor market that’s battered confidence. The risk of a broader pullback in spending, which accounts for about 70 percent of the economy, increases pressure on the Federal Reserve, Obama administration and Congress to craft a plan to ensure the recovery is sustained.

U.S. Stock-Index Futures Fall Amid Speculation Greece Approaching Default (Source: Bloomberg)
U.S. stock futures fell, indicating the Standard & Poor’s 500 Index will extend last week’s loss, as speculation Germany is preparing for a Greek default spurred turmoil in financial markets worldwide. S&P 500 futures expiring in December lost 0.9 percent to 1,141.70 at 10:55 a.m. in Tokyo. The benchmark measure of U.S. equities slumped 1.7 percent last week, wiping out its rally since Sept. 2 on the final day amid concern the debt crisis is worsening. The MSCI Asia Pacific Index lost 1.7 percent today.
Officials in Chancellor Angela Merkel’s government are debating how to shore up German banks in the event that Greece fails to meet the budget-cutting terms of its aid package and is unable to get a bailout-loan payment, three coalition officials said Sept. 9. BNP Paribas SA, Societe Generale SA and Credit Agricole SA, France’s largest banks by market value, may have their credit ratings cut by Moody’s Investors Service as soon as this week because of Greek holdings, two people with knowledge of the matter said on Sept. 10.

U.S. Stocks Drop as Greece Concern Outweighs Obama’s Growth Plan (Source: Bloomberg)
U.S. stocks fell, driving the Standard & Poor’s 500 Index to the sixth drop in the past seven weeks, as concern Greece’s finances are deteriorating overshadowed President Barack Obama’s $447 billion plan to stimulate growth. JPMorgan Chase & Co. (JPM) and Hewlett-Packard Co. decreased more than 6.9 percent on concern about a global financial crisis as 27 of 30 Dow Jones Industrial Average companies retreated. McDonald’s Corp. (MCD) slumped 4.6 percent as August sales trailed analysts’ estimates. Financial and materials companies in the S&P 500 fell 2.4 percent or more, the most among 10 industries. Yahoo! Inc. added 13 percent after the most-visited U.S. Web portal ousted Chief Executive Officer Carol Bartz. The S&P 500 fell 1.7 percent to 1,154.23 this week, the second straight weekly loss and the lowest level since Aug. 22. The Dow retreated 248.13 points, or 2.2 percent, to 10,992.13.

McDonald's Sales Growth Comes Up Short (Source: CME)
McDonald's Corp.'s said its global same-store sales grew a slower-than-expected 3.5% in August, hurt in part by weaker results for Japan. The fast-food chain has consistently outperformed its competitors during and since the recession with its increasingly diverse menu, ranging from value offerings to higher-margin products like blended-ice drinks. Competitive pricing helped McDonald's growth during the economic downturn, but the company has been increasing some menu prices of late in order to mitigate higher commodity costs. For August, McDonald's pointed to strength among its McCafe beverages, breakfast offerings and new premium chicken sandwiches. Sales at U.S. outlets open at least 13 months rose 3.9%, missing the analysts' growth estimate of 4.4%. Piper Jaffray on Wednesday said it expected Hurricane Irene to cut into McDonald's sales for the month.
In Europe, same-store sales grew 2.7%, though short of the analysts' forecast for a 5.57% increase. The Asia/Pacific, Middle East and Africa region posted a 0.3% decrease as growth in China, Australia and other markets was offset by Japan. Systemwide sales rose 11% in August, or 5.4% excluding currency fluctuations. McDonald's reported in July its second-quarter income rose 15%, as the burger chain continued to build sales momentum with its new menu choices, despite the economic head winds challenging the fast-food industry.

China Trade Surplus Narrows More Than Estimated as Imports Climb to Record (Source: Bloomberg)
China’s imports climbed to a record and exports grew more than expected last month, indicating resilience in the world’s second-biggest economy as the U.S. and European recoveries falter. Inbound shipments jumped 30.2 percent from a year earlier to $155.6 billion, the customs bureau said on its website yesterday. That pace exceeded the estimates of all 29 economists in a Bloomberg News survey. Exports climbed a more-than-expected 24.5 percent, leaving a trade surplus of $17.76 billion. The data suggest the world’s biggest exporter is weathering Europe’s debt crisis and weakening U.S. consumer sentiment. Group of Seven finance chiefs yesterday vowed to buoy slowing economic growth after global stocks slumped on concern that Greece may default and the risk that Congress may block President Barack Obama’s measures to create jobs.

China Strength Defies Hard Landing Scenario (Source: Bloomberg)
China’s record imports and a rebound in lending signaled strength in demand that offers a bright spot in a global economy contending with Europe’s debt crisis and weakening U.S. job gains. Shipments from abroad jumped 30 percent and new local- currency loans were a more-than-forecast 548.5 billion yuan ($86 billion), government reports in the past two days showed. At the same time, August figures released Sept. 9 indicated that policy makers have made progress in stemming inflation, which eased from a three year high, to a 6.2 percent year-on-year pace. The data may bolster confidence that the world’s second- largest economy is weathering both Premier Wen Jiabao’s campaign to defuse price pressures and financial turmoil abroad. Group of Seven finance chiefs vowed “a concerted effort” to support expansion on Sept. 9 as Europe’s debt woes and zero jobs growth in the U.S. increase the risks of a renewed recession.

Japanese Stocks Decline Second Day on Speculation Greece Nearing Default (Source: Bloomberg)
Japanese stocks fell for a second day, with the Topix index set for its biggest decline in more than three weeks, as exporters and banks tumbled amid speculation Greece may be nearing default. Sony Corp. (6758), an exporter of consumer electronics that gets 21 percent of its sales in Europe, fell 3.2 percent as the yen’s advance to a 10-year high against the euro dimmed the outlook for earnings. Toyota Motor Corp. (7203) and Honda Motor Corp. dropped at least 2.7 percent. Mitsubishi UFJ Financial Group Inc., Japan’s biggest lender by market value, declined 2.7 percent. The Topix slid 2 percent to 740.67, the biggest decline since Aug. 19. The benchmark Nikkei 225 (NKY) Stock Average fell 2.2 percent to 8,549.85 as of 10 a.m. in Tokyo.

Papandreou OKs Taxes, Cuts to Dodge Default (Source: Bloomberg)
Prime Minister George Papandreou, vowing to avoid a default and keep Greece in the euro, approved new measures to help plug a yawning budget gap as resistance builds at home and in Europe to extending more aid to the European Union’s most-indebted nation. The Cabinet yesterday voted to cut one month’s wages from all elected officials and impose an annual charge on all property for two years, to be levied through electricity bills to ensure rapid collection, Finance Minister Evangelos Venizelos told reporters in the northern Greek city of Thessaloniki. The measures will help the country meet deficit targets of 17.1 billion euros ($23.6 billion) in 2011 and 14.9 billion euros in 2012, covering a 2 billion-euro shortfall for this year that has been exacerbated by a deepening recession, he said.

Germany Readies Surrender in Fight to Save Greece (Source: Bloomberg)
Germany may be getting ready to give up on Greece, as measures in the credit markets signal growing concern about the smaller nation’s ability to repay investors. Yields on Greek two-year notes rose 1.93 percentage points to 57 percent on Sept. 9, according to data compiled by Bloomberg. Credit-default swaps to insure the country’s five- year bonds and to speculate on government securities jumped 475 basis points to a record 3,500 basis points, according to CMA. The contracts are the highest in the world and more than three times the 1,134 basis points on Portugal’s debt. After almost two years of fighting to contain the region’s debt crisis and providing the biggest share of three European bailouts, German Chancellor Angela Merkel is laying the groundwork for what markets say is almost a sure thing: a Greek default.

Draghi’s Hands May Be Tied on ECB Stimulus (Source: Bloomberg)
Mario Draghi may find it harder to keep the European Central Bank in the vanguard of the battle against the euro region’s debt crisis after Juergen Stark resigned in protest at the bank’s bond purchases. With speculation of a Greek default heaping pressure on the ECB to step up its bond buying and reverse interest-rate increases to ease market tensions, Stark’s shock move has publicly exposed a rift among policy makers that may undermine its ability to act quickly, economists said. German opposition to further ECB stimulus may also make Draghi less inclined to ease policy when he takes over from ECB President Jean-Claude Trichet on Nov. 1, said Marco Valli, chief euro-area economist at UniCredit Group in Milan. “It would be very easy for Germans to say here comes the Italian, he’ll cut rates and buy government bonds in massive amounts,” Valli said. Draghi “will probably prefer to err on the side of hawkishness on standard measures, which means he may be reluctant to go for a rate cut.”

Europe Banks Valued at Post-Lehman Low (Source: Bloomberg)
Investors are valuing European banks at levels not seen since the depths of the credit crunch that followed the collapse of Lehman Brothers Holdings Inc. (LEHMQ) as concern over a Greek default and debt contagion escalates. A Bloomberg index shows 46 lenders trading at 0.58 times book value, the cheapest since the post-Lehman lows of March 2009, signaling investors estimate their assets are worth just over half what the companies claim. Valuations reflect the impact of a potential sovereign default for some banks, according to Barclays Capital analysts led by Jeremy Sigee. Group of Seven finance chiefs meeting in Marseille, France, over the weekend vowed to support banks amid growing concern that the debt crisis is morphing into a banking crisis. As doubts linger about the ability of some European lenders to withstand a Greek default and its ripple effects, the cost of insuring their debt rose to records, while a measure of their reluctance to lend to each other climbed to a 2 1/2-year high.

Euro May Weaken Against Dollar as German Exports Decline: Chart of the Day (Source: Bloomberg)
The euro is poised to weaken against the dollar as falling German exports add to evidence that the region’s largest economy is losing momentum, according to FxPro Financial Services Ltd. The CHART OF THE DAY shows seasonally adjusted German exports grew 16 percent in the year through April, while the euro gained 11 percent. They slid 1.8 percent in July from June, when they dropped 1.2, according to the Federal Statistics Office in Wiesbaden on Sept. 8. The 17-nation currency was little changed against the dollar in the period. The decline in exports increases the likelihood that the euro will decline, FxPro said.
“Should the German export machine continue to lose traction, then this is likely to place further pressure on the euro,” Michael Derks, chief strategist at FxPro in London, said by telephone on Sept. 9. “Germany relies on foreign demand to prosper, so with the rest of Europe and the U.S. hunkering down, it will suffer. A weakened Germany cannot be good for the euro at such an incredibly uncertain time.”

Europe May Need to Bail Out, Nationalize Some Banks, Westpac’s Jones Says (Source: Bloomberg)
European officials may have to bail out and nationalize some private banks to avoid another global recession, said Russell Jones, global head of fixed-income strategy at Australia’s second-biggest lender. “The last thing really the global economy needs now is a major banking crisis in the euro zone,” Jones, of Sydney-based Westpac Banking Corp., said in an interview yesterday on the Australian Broadcasting Corp.’s “Inside Business” program. “The governments are going to have to put their hands in their pockets.” Group of Seven finance chiefs and central bankers vowed in recent days to support banks and buoy slowing economic growth. “We will take all necessary actions to ensure the resilience of banking systems and financial markets,” they said in a statement released during weekend talks in Marseille, France.

Europe Banks Valued at Post-Lehman Low (Source: Bloomberg)
Investors are valuing European banks at levels not seen since the depths of the credit crunch that followed the collapse of Lehman Brothers Holdings Inc. (LEHMQ) as concern over a Greek default and debt contagion escalates. A Bloomberg index shows 46 lenders trading at 0.58 times book value, the cheapest since the post-Lehman lows of March 2009, signaling investors estimate their assets are worth just over half what the companies claim. Valuations reflect the impact of a potential sovereign default for some banks, according to Barclays Capital analysts led by Jeremy Sigee. Group of Seven finance chiefs meeting in Marseille, France, over the weekend vowed to support banks amid growing concern that the debt crisis is morphing into a banking crisis. As doubts linger about the ability of some European lenders to withstand a Greek default and its ripple effects, the cost of insuring their debt rose to records, while a measure of their reluctance to lend to each other climbed to a 2 1/2-year high.

European Stocks Drop for First Week in Three as Banks Sink on Debt Concern (Source: Bloomberg)
European stocks fell for the first week in three amid concern policy makers won’t be able to stop the region’s sovereign debt crisis from growing and damaging the economic recovery. Societe Generale SA and Banco Comercial Portugues SA (BCP) led a measure of European bank shares to the lowest since March 2009. Royal Bank of Scotland Group Plc (RBS) and Barclays Plc (BARC) each sank 13 percent as 17 lenders were sued by the U.S. over the sale of mortgage-backed securities and interbank lending rates climbed.
The Stoxx Europe 600 Index dropped 3.7 percent to 224.59 this past week as 18 of 19 industry groups declined. The gauge has plunged 23 percent since this year’s peak on Feb. 17 as economic data from the U.S. and Europe trailed forecasts and Standard & Poor’s downgraded America’s AAA sovereign-debt rating, citing political failure to reduce record deficits. The index is trading at 9.4 times the estimated earnings of its constituent companies, near the lowest valuation since March 2009, according to data compiled by Bloomberg.

Germany’s Benchmark DAX Index Falls; Deutsche Telekom, Siemens, BASF Drop (Source: Bloomberg)
German stocks slumped to a two-year low as three coalition officials said Angela Merkel’s government is preparing plans to shore up the nation’s banks in the event that Greece defaults. Deutsche Bank AG and Commerzbank AG tumbled more than 7 percent, tracking a slide in financial shares across Europe. Porsche SE retreated 14 percent as Volkswagen AG (VOW) said its merger with the sports-car maker can no longer be completed by the end of the year. The DAX Index (DAX) slid 4 percent to 5,189.93 at the 5:30 p.m. close in Frankfurt, the lowest since July 2009. The gauge fell 6.3 percent this week, extending the drop since the 2011 high on May 2 to 31 percent amid growing concern that growth in the global economy is slowing as Europe’s debt crisis spreads.

Australia Jobs Data Underestimate Demand for Nation’s Workers, Swan Says (Source: Bloomberg)
Australia’s rise in unemployment last month doesn’t fully reflect the demand for workers in an economy that “continues to outperform” the U.S. and Europe, Treasurer Wayne Swan said. “Recent jobs data has underestimated the strength of demand for labor in our economy given an increase in working hours,” Swan said yesterday in his weekly economic note. Australia’s jobless rate jumped to a 10-month high of 5.3 percent in August, the second straight monthly rise, according to a government report Sept. 8. Prime Minister Julia Gillard’s administration is trying to counter declines in consumer and business sentiment that last month helped lift the ranks of the jobless to 636,800, the most since October. Many part-time workers have been picking up a few extra hours each week,” Swan said. “Had employers met the increase in labor demand by hiring new workers, we would have seen an additional 110,000 jobs created since the start of the year.”

Australia’s Dollar Tumbles to Three-Week Low on Greek Concern; Kiwi Drops (Source: Bloomberg)
The Australian dollar dropped to the lowest in almost three weeks against its U.S. counterpart as concern Greece may default prompted investors to sell higher- yielding assets. The New Zealand dollar declined to near a one-month low before German Chancellor Angela Merkel holds talks on the debt crisis with European Commission President Jose Manuel Barroso today in Berlin. The so-called Aussie and kiwi fell for a third day as Asian stocks extended a global slump. Demand for Australia’s currency was also curbed after data showed the nation’s trade surplus narrowed in July by more than economists had forecast. “Unless there’s some major statements from the European authorities about resolving the debt situation, I think the euro, Aussie and kiwi will all fall this week,” said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia, the nation’s biggest lender.

Hedge Funds Weather August Financial Market Rout Trading Gold at a Record (Source: Bloomberg)
Hedge funds run by Orix Investment Corp., Superfund and Four Elements Capital Management Pte benefited from the surge in gold last month, weathering the U.S. sovereign downgrade and Europe’s deepening debt crisis. The Orix Commodities Fund, which uses computer programs to search for price signals in futures markets, gained 3.5 percent in August, while Superfund Blue Gold, which invests in global equities and tracks the bullion price, jumped 13.45 percent, the firms said. Gold investments in the Earth Element Fund, run by former commodity traders at BNP Paribas (BNP) and JPMorgan Chase & Co. (JPM), returned 1 percent, helping trim losses in the fund. Gold surpassed $1,900 an ounce for the first time in August as investors sought protection for their wealth on concerns that global economic growth is slowing. The Eurekahedge Hedge Fund Index lost 1.9 percent in August and the MSCI World Index slid 7.3 percent, their worst month since May 2010.

20110912 1102 Global Commodities Related News.

Funds Boost Bullish Commodity Bets on Outlook for Economic-Stimulus Plans (Source: Bloomberg)
Funds increased bullish bets on raw materials for a fourth straight week, the longest series of gains this year, on speculation that economic-stimulus programs will lift demand for metals, grains and energy. In the week ended Sept. 6, speculators raised their net- long positions in 18 commodities by 0.2 percent to 1.28 million futures and options contracts, government data compiled by Bloomberg show. That’s the highest level since June 14. Funds became bullish on copper for the first time in three weeks, and wagers on a gold rally increased for the first time since early August. Last week, Federal Reserve Chairman Ben S. Bernanke said policy makers this month will discuss tools they may use to help the recovery, and President Barack Obama proposed a $447 billion plan to spur job growth. The Standard & Poor’s GSCI Index of 24 commodities has surged 27 percent in the past year as the Fed kept U.S. borrowing costs near zero percent and bought Treasuries in a bid to stimulate growth.

Commodities Slide Worldwide on Global Growth Concerns, Led By Crude Oil (Source: Bloomberg)
Commodities dropped for a second day amid mounting concern the faltering economic recovery in the U.S. and Europe will curb demand for raw materials. The Standard & Poor’s GSCI Index of 24 commodities fell as much as 2.6 percent in New York, the most in more than three weeks, as investors sold all but the safest assets. Coffee traded at a two-week low, gasoline had its biggest decline in five weeks and West Texas Intermediate crude retreated the most in a week. Gold rose for a second day. Three German officials said today that Chancellor Angela Merkel’s government is preparing plans to shore up banks in the event that Greece can’t pay its debts. European Central Bank President Jean-Claude Trichet said yesterday policy makers cut their growth forecasts for this year and next. U.S. President Barack Obama, in an television address yesterday, called on Congress to pass a $447 billion plan to boost employment after hiring by U.S. companies stalled last month.

Corn (Source: CME)
US corn futures close higher as traders buy back previously sold positions on expectations federal forecasters will cut harvest and inventory outlooks in reports Monday. The reports are "going to be friendly almost no matter what," predicts John Kleist of ebottrading.com. Yet, traders also will look to see whether the USDA cuts demand estimates due to high prices. Reduced usage estimates could take the sting out of a smaller output forecast. CBOT December corn rises 2 1/2c to $7.36 1/2 a bushel.

Wheat (Source: CME)
US wheat futures finish weaker as traders worry about soft demand. Weekly export sales of 512,200 tons were slightly above traders' expectations, but nearly half the sales were to "unknown destinations." Deals with unknown buyers are more likely to be cancelled than those to named buyers, notes John Kleist of ecbottrading.com. Foreign demand for US wheat in general has suffered from increased competition from Russia. CBOT December wheat drops 8 1/4c to $7.29 3/4 a bushel while KCBT December loses 13 1/2c to $8.32 1/2 and MGEX December slips 1c to $9.07 1/4.

Rice (Source: CME)
US rice futures close limit up as India's return to the global export market fails to end supply concerns. Prices climb ahead of USDA reports Monday that could trim the outlook for US rice output due to hot weather that stressed the crop last month, analysts say. Gains were a turnaround from a setback Thursday fueled by India's decision to resume rice exports in a limited capacity. CBOT November rice closes up the 50c daily limit at $18.33/hundredweight. The limit temporarily expands to 75c Monday.

US corn, wheat rebound after selloff, trade cautious
SINGAPORE, Sept 9 (Reuters) - U.S. corn and wheat futures bounced back, rising around half a percent on bargain hunting following a selloff triggered by India's move to export grains.  
"Funds sold commodities last night as there was a bit of liquidation, it feels like the market has lost a little bit of upward momentum this week," said Brett Cooper, a senior manager of markets at FCStone Australia.

India allows exports of 2 mln T each of rice, wheat
NEW DELHI, Sept 8 (Reuters) - India will allow unrestricted exports of two million tonnes each of wheat and common rice, as bulging stocks offer political room for overseas sales which could depress global rice prices but make little dent in wheat supplies.
"We will stop exports once shipments reach 2 million tonnes each," Food Minister K.V. Thomas said after a meeting of a ministerial panel. He said there will be no minimum export price for rice. Wheat has no floor price for exports.

Argentine wheat outlook dims due dryness - exchange
BUENOS AIRES, Sept 8 (Reuters) - Much of Argentina's wheat belt is getting dry, with frosts hampering the healthy development of 2011/12 crops in some northern areas, the Buenos Aires Grains Exchange said Thursday.
Argentina is one of the world's biggest wheat suppliers and farmers are expected to produce 13.5 million tonnes this season, down from 15 million in the 2010/11 crop year, according to the U.S. Department of Agriculture (USDA).

Argentine corn plantings seen up 10 pct - Rosario
BUENOS AIRES, Sept 8 (Reuters) - Argentina's 2011/12 corn area is expected to expand 10 percent from last season to 4.3 million hectares, Rosario grains exchange said on Thursday.
Argentina, the world's No. 2 corn supplier after the United States, produced an estimated 22 million tonnes in the previous harvest, according to the latest estimate from the U.S. Department of Agriculture (USDA).

EU cleared 415,000 tonnes wheat exports this week
PARIS, Sept 8 (Reuters) - The European Union this week granted export licences for 415,000 tonnes of soft wheat, the biggest award since the start of the 2011/2012 season on July 1, official data showed on Thursday.
European exports in the new season have been curbed by the return of Russia to export markets after it had banned grain exports in August 2010 in response to a drought that ravaged its crops.  

Monsanto says corn rootworm resistance not spreading
KANSAS CITY, Mo., Sept 8 (Reuters) - Monsanto Co.  is working with a "handful" of farmers to rein in problems with corn pests that appear to be growing resistant to the company's popular corn seed product that is genetically engineered to protect against insect damage.
Recent news reports of resistance problems in top corn-producing states of Iowa and Illinois have fueled investor concerns. The company is already struggling to address weed resistance problems related to its herbicide-tolerant genetically altered crops.

India's monsoon rains 39 pct above normal in past week-sources
NEW DELHI, Sept 8 (Reuters) - India's monsoon rains were 39 percent above normal in the week to Sept. 7, strengthening from 18 percent above average in the previous week, two sources at the weather office said on Thursday.
The monsoon rains were three percent above average since the start of the June-September season, in line with the weather office's latest forecast of a normal monsoon in 2011.

For Grocers, Pricing Becomes More Perilous (Source: CME)
Supermarket chains, many of which face a 4% rise in food costs this year, are being forced to reconcile raising prices with potentially losing shoppers to rivals who hold the line. In this balancing act, chains including Whole Foods Market Inc., Safeway Inc. and Supervalu Inc. say they are trying to make promotions more effective, be mindful of where they raise prices and work out better deals with vendors. "I'm not sure consumers want us raising prices much more from here, and I think we've got to start holding a tough line [with vendors] from this point forward," Whole Foods Chief Executive Walter Robb told analysts Wednesday, during part of a two-day Goldman Sachs retail conference. According to the Bureau of Labor Statistics, grocery store prices have jumped 5.4% during the past 12 months and that is hitting consumers while they are still concerned about job security, housing and gas prices.
"The vast majority of shoppers still feel threatened about their jobs. You see that all reflected in consumer confidence," Safeway Chief Executive Steven Burd said Wednesday. "Our expectation is the economy will remain relatively flat, and as it recovers, it will recover slowly." Mr. Burd said it is more important than ever for supermarkets to keep up with competitors' discounts, "because if people try in the short-term to take market share, and you don't react, they will continue to pick away at you." Supervalu Chief Financial Officer Sherry Smith said that Supervalu, like other chains, has raised some prices to offset some of the inflation this year. "Overall, we've been passing on price increases, we've been seeing resiliency in the customer, and we also see a rational environment out there in that retail is passing it on generally as a whole," Ms. Smith said. However,
Supervalu is also trying to lower its price perception to be more in line with competitors, making it difficult to keep up with rising inflation. As a result, Supervalu has been careful of where it raises prices to match inflation, and where it just takes the hit, as it found that some areas, within the dairy, meat and perishables categories, are more sensitive to price increases. Whole Foods' Mr. Robb said supermarkets have to push back with vendors, asking them to explain where those cost increases are coming from before agreeing to them. Mr. Burd said sometimes packaged-food companies, such as Kraft Foods Inc., will issue more promotions during periods of price inflation, as an alternative to the supermarkets having to roll back prices and cover the cost themselves.
Whole Foods says it has become more sophisticated and specific with its promotional dollars lately to make them work. "It's not about how many items you have on sale, it's about which items and how compelling is the discount on the promotion," Mr. Robb said.

Indian Grain Exports To Drag Down Global Prices (Source: CME)
India's return to the wheat and rice export market after more than three years, will push down prices for buyers in Southeast Asia and Africa, trading executives and analysts said. The Indian Government has allowed exports of at least 2 million metric tons each of wheat and rice, relaxing a ban on shipments due to burgeoning stocks following a string of bumper harvests. There is an ample global supply of wheat but availability of high quality grades is tight because rains and heat damaged some crops in Australia and the U.S. Earlier this year, Pakistan's output helped fill the gap in cheaper milling wheat supply to Southeast Asia, the Middle East and even Africa, and now cargoes from India will be very useful, a Singapore-based executive with a global commodities trading company said. The real challenge for Indian exporters will be to secure the wheat supply locally, because a large part of the crop has already been procured by the government or consumed, and the next harvest doesn't begin until mid-February.
The physical prices of Indian export grade wheat rose sharply Friday as exporters scrambled to lock in supply. "The phones haven't stopped ringing since the government made the announcement, and the prices of some wheat grades in Gujarat and Rajasthan are up by INR400-INR600/ton," a Mumbai-based trading executive said. Some western India grades are selling for around INR11,800-INR11,900/ton, delivered at port, and after adding port expenses, can be offered around $280/ton, free-on-board, which is among the cheapest in the world, traders said. However, it is a fast-moving situation, and prices will likely continue rising, they said. Russian wheat is currently offered around $290/ton, FOB, while Australian Standard White is quoted at $310/ton. Rice buyers in Africa and the Philippines may cancel some earlier deals for more expensive Thai ordinary rice, due to India's resumption of exports, traders said.
India's entry will definitely weigh on Pakistan's rice export quotations and benefit buyers in Bangladesh, said Raja Lal Chand Essrani, president of Raja Brokers, a Karachi-based trading company. India will capture a significant portion of the parboiled rice export market from Thailand, former president of Thai Rice Exporters Association, Chookiat Ophaswongse said. Based on current local rates, India can export polished and sortex 5% broken parboiled rice for around $460-$470/ton, free-on-board compared with Thai offers of more than $650/ton, FOB.

Buenos Aires Cereals Exchange: Dry Weather A Risk To Wheat Crop (Source: CME)
Dry weather could start to damage Argentina's wheat crop unless rain comes to the rescue, the Buenos Aires Cereals Exchange said in its weekly crop report. "The majority of forecasts don't foresee rain except in isolated spots," the exchange said. Farmers planted 4.6 million hectares of wheat in the 2011-2012 season, the second smallest planting area dedicated to that grain in the last 10 years. Most of Argentina's wheat exports are sent to neighboring Brazil. The exchange kept its outlook for corn planting during this season unchanged at 3.5 million hectares. Argentina produced 21 million metric tons of corn during the 2010-2011 season.
Farmers have sewn 19.5% of an estimated 1.86 million hectares they are expected to plant with sunflowers, the exchange said. Argentina is the world's biggest exporter of soymeal and soyoil, ranks No. 2 in corn exports, No. 3 in soybeans, and is a leading exporter of wheat and sunflower seed oil.

Australian Government Says Foreign Ownership Of Farm Land Small (Source: CME)
The Australian government moved to ease community concerns about rising foreign ownership of farming land, saying only 5.8% is majority-owned by international investors. According to data compiled by the Australian Bureau of Statistics, a further 5.5% of farming land is majority owned by Australians and with some foreign interest. The report also showed 99% of Australian farming businesses are entirely Australian owned, while 88.6% of agricultural land in Australian was fully owned locally. "The Australian government understands the legitimate community concerns about foreign investment in agricultural land and businesses. At last we have some hard data about the true extent of foreign ownership of agricultural businesses, land and water," said Assistant Treasurer Bill Shorten. Shorten said Australia prizes foreign investment. "The policy debate surrounding Australia's agricultural land and businesses has raised a number of issues, often extending into areas outside foreign investment," he said.

Canada Is Taking Aim At Its Wheat Monopoly (Source: CME)
For 70 years, a lone trading desk in Canada's prairie region quietly has held sway over the price of wheat and, in effect, how much consumers pay for everything from a loaf of bread to a bowl of pasta. But those days are numbered. The Canadian Wheat Board is poised to lose its monopoly grip on the country's wheat sales. Canada's Conservative Party captured a parliamentary majority this past spring, and newly elected government officials took that as a mandate to end the wheat board's reign. The ripple effects from eliminating -- or even weakening -- the board's power would be widespread. Wheat prices, which already have experienced extreme highs and lows over the past three years, could become more volatile, some analysts say.
The move could be a boon for consumers, say analysts. Prices for Canadian wheat could fall more than usual at harvest time next summer if the board is eliminated. Wheat prices are a big input cost for food manufacturers, which recently have raised their own prices in response to higher commodity costs. Among Western countries, the board, which is backed by laws that essentially make it the only seller of Canadian farmers' wheat and barley, is one of the last bastions of direct state control. If eliminated, for the first time in three generations, thousands of farmers, mostly in the western provinces of Alberta, Saskatchewan and Manitoba, would be selling wheat and barley on their own. Canadian farmers' appetite to take on the risks that come with navigating global grain markets is set to become more apparent on Friday, when the results of their vote on whether to maintain the board are scheduled to be released.
The vote, however, is nonbinding, and Canadian officials say they will push ahead with plans to eliminate the wheat board regardless of the outcome. Canadian Agriculture Minister Gerry Ritz said in an interview that such legislation could be introduced this fall and could win passage by the end of this year. The Conservative Party has enough votes in the legislature to pass laws as it sees fit. "The bottom line for us is the freedom for western Canadian farmers to make the choice as to who, when and how much they sell their product. That should never be trumped by any other entity," Mr. Ritz said. Based in Winnipeg, the Canadian Wheat Board plays a particularly important role in the global wheat trade. For now, it is the sole representative of Canada, which consistently ranks among the world's top four exporters. The single desk controls around 14% of global wheat exports, including about half the world's exports of durum wheat, which is used to make pasta.
While the end of the board isn't expected to alter significantly Canada's wheat output, it is likely to force Canadian farmers to catch up with their U.S. counterparts, who have been navigating volatile markets for decades. "The Canadian farmer has been used to a 'single desk' for so long," said Dan Basse, president of AgResource Co., an agricultural consultancy in Chicago. "He'll have to learn marketing very fast." Whether the arrangement is best for farmers has been long debated in Canada's western grain belt stretching from Manitoba into parts of British Columbia. "For years, the Canadian Wheat Board has been the most divisive issue in western Canadian agriculture," said Kevin Bender, a farmer and president of Western Canadian Wheat Growers, which advocates for an open market. The third-generation grower on the eastern edge of the Canadian Rockies wants the freedom to sell his grain to whomever he wants. Mr. Bender said farmers can capture better returns on their own by having open markets they can time.
U.S. elevators just over the border often offer prices higher than those paid through the board, he added. Yet, farmers who favor the board, including its current chairman Allen Oberg, contend the benefits far outweigh the cross-border price differences that can emerge. By controlling the whole crop, the board has considerable power in global commodity markets to ensure Canadian farmers get the best price. Farmers also get an up-front payment that is backed by the government, and the board doesn't aim for a profit, so more money goes back to farmers than under an open-market system. Without their own facilities, farmers may have to sell the bulk of the grain as new supplies are coming in from the fields, pressuring prices, said Mr. Basse of AgResource. Exchanges anticipate that Canadian farmers will turn to futures markets in full force once the wheat board goes away, and they and grain handlers already are jockeying for the expected new opportunities.

ICE cocoa edges up, consolidates after fall
LONDON, Sept 9 (Reuters) - ICE cocoa futures edged up as the market began to stabilise after falling sharply this week while raw sugar was also slightly higher.
Cocoa futures on ICE were marginally higher as the market looked to consolidate after its biggest three-day tumble in four months.

India extends unrestricted cotton exports beyond Oct 1-official
NEW DELHI, Sept 9 (Reuters) - India will continue with unrestricted cotton exports in the new marketing year beginning Oct. 1, Trade Secretary Rahul Khullar told reporters on Friday.
The world's second biggest grower and exporter of cotton had allowed in July unrestricted exports of the fibre for the remainder of the current season due to abundant availability of stocks.

Ukraine Agmin upgrades 11/12 sugar output fcast
KIEV, Sept 8 (Reuters) - Ukraine's Agriculture Ministry on Thursday revised up its forecast for the 2011/12 white beet sugar production slightly to 2.1-2.2 million tonnes from the previous estimate of 2.0-2.1 million due to a higher sugar beet harvest.
Ukraine produced 1.55 million tonnes of white sugar from sugar beet in 2009/10.

US ethanol output bumps higher, exports strong
KANSAS CITY, Mo., Sept 8 (Reuters) - U.S. ethanol production rose slightly in the last week but stocks decreased as export demand for the corn-based alternative fuel increased.
The Energy Information Administration said on Thursday that U.S. ethanol production totaled 896,000 barrels per day in the seven days to Sept. 2, up 8,000 barrels per day from the previous week.

EU to delay action on biofuels' indirect impact
BRUSSELS, Sept 8 (Reuters) - The European Union's top climate and energy officials have agreed to delay by up to seven years rules that would penalise individual biofuels for their indirect climate impacts, details of the deal showed.
The political compromise is designed to protect EU farmers' incomes and existing investments in the bloc's 17 billion euro-a-year ($24 billion) biofuel sector, while discouraging new investments in biofuels that do nothing to fight climate change.

China Aug refinery runs 2nd-lowest this year
BEIJING, Sept 9 (Reuters) - China's refinery throughput grew at a modest 4.5 percent on the year in August to about 8.66 million barrels per day, the second-lowest daily processing rate this year due to regular plant shutdowns and refinery accidents.
This is the third straight month that China has operated its refineries at levels below the norm since late 2010, capping demand growth in the world's second-largest oil user at rates slower than the double-digit pace seen earlier in the year.

Oil Drops a Third Day on Europe Concern; Gulf Storm Threat to Output Eases (Source: Bloomberg)
Oil slid for a third day in New York as investors bet demand for fuel may falter amid signs European policy makers are struggling to contain the region’s debt crisis. Gulf of Mexico producers resumed production as the threat of storms eased. Futures slipped as much as 1.3 percent as speculation that Germany is preparing for a Greek default sent the euro lower against the dollar, limiting the appeal of commodities. About 6 percent of oil output remains shut after Tropical Storm Lee passed, compared with 27 percent a week ago. Nate weakened to a depression as it moved further inland over Mexico, according to the U.S. National Hurricane Center. “Oil futures fell back in response to the negative mood dominating the U.S. and Europe,” economists at Australia & New Zealand Banking Group Ltd., led by Warren Hogan, said in a note today. The euro “continues to come under pressure as Europe’s troubles remain in focus,” he said.

China’s Nickel Import Demand ‘Surging’ as Macquarie Says It’s More Bullish (Source: Bloomberg)
Nickel import demand in China is “surging” because of a shortage of nickel pig iron, Macquarie Group Ltd. said, citing unidentified sources. Nickel pig iron, usually a cheaper alternative to refined nickel, is now more expensive, Macquarie said in a report dated Sept. 12. A trading company in China may be building nickel stockpiles to start a nickel exchange-traded fund, Macquarie said, citing reports without identifying the authors. “These factors make us more bullish about the nickel price outlook in the short run, even though we maintain a forecast of a large 2012 surplus,” Macquarie said.

Gold Declines for Second Day as European Debt Concern Sends Dollar Higher (Source: Bloomberg)
Gold fell for a second day as concern about a potential Greek default drove the dollar higher and some investors sold the metal to cover losses in other markets amid concern the European debt contagion is worsening. Gold for immediate delivery declined as much as 0.7 percent to $1,842.25 an ounce, and traded at $1,847.70 at 9:29 a.m. in Singapore, erasing an earlier gain of 0.4 percent. It reached a record $1,921.15 an ounce on Sept. 6. Bullion priced in euros and Swiss francs advanced to all-time highs today. The Dollar Index, which tracks the greenback against six U.S. trading partners, climbed for a third day to its strongest in more than six months as investors sought safe assets. December-delivery bullion in New York, which sometimes moves inversely to the dollar, shed as much as 0.8 percent to $1,844.60 an ounce before trading at $1,850.30 an ounce.

20110912 1100 Soy Oil & Palm Oil Related News.

ITS CPO export down 36.4% to 592,538 tonnes for the period of 1~10 Sep 2011.
SGS CPO export down 36% to 389,069 tonnes for the period of 1~10 Sep 2011.

MPOB Official Data for the month of Aug 2011 vs Jul 2011
Export down 2.7%
Stock down 5.6%
Output down 4.8%

Soybeans (Source: CME)
US soybean futures end higher, bouncing back from a choppy start, as traders balanced some positions ahead of Monday's reports. The uncertainty of crop production supported prices, but without a clear picture of yield potential, many traders remained cautious, essentially holding prices within a narrow trading range, analysts say. Industry participants are bracing for government projections on crop size Monday, with most anticipating tighter supply projections. CBOT Nov soy end up 8 1/2c at $14.26 3/4/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures rallied, rising in unison with advances in soybeans. Anticipation of government forecasters tightening the supply outlook for soybeans served as the catalyst for traders to cover some short positions ahead of Monday's government crop report, analysts say. CBOT Dec soymeal finish up 0.8% at $375.10/short ton; Dec soyoil climbed 0.7% to 58.71c/lb.

Palm oil perks up ahead of industry data
KUALA LUMPUR, Sept 9 (Reuters) - Malaysian palm oil futures rose as traders took up positions ahead of a slew of industry reports that could shed light on a decline in vegetable oil supplies.
"The festival season is still ongoing but there will be some moderation in buying for some time," said a trader with a foreign commodities brokerage.

China seen buying more soy as pork output expands
SHANGHAI, Sept 8 (Reuters) - China soybean imports are likely to climb more than 10 percent to around 58 million tonnes in the year ahead as the world's biggest buyer of the grain ramps up pork production to ease tight supply, and food inflation.
The country's imports in the year to September 2012 could even hit 60 million tonnes if pig farmers, lured by record high pork prices, boost stocks, said Guo Feng, a deputy general manager at state-owned trading house Chinatex Grains and Oils Import and Export Co.

Indonesia's refined palm oil tax redraws landscape
KUALA LUMPUR, Sept 9 (Reuters) - Lower taxes on refined edible oil exports from top crude palm oil producer Indonesia are set to boost cooking oil supplies in the region, eroding margins for rival Malaysia and making cargoes cheaper for Asian buyers.
For decades, refined, bleached and deodorised (RBD) palm olein used in cooking oil enjoyed premiums of 5-10 percent over crude palm oil futures  as No.2 producer Malaysia was the sole supplier with tax free exports and massive processing capacity.

USDA seen trimming U.S. soy production forecast
CHICAGO, Sept 8 (Reuters) - Hot and dry August weather in the U.S. Midwest caused soybean crop ratings to deteriorate and should prompt the U.S. Department of Agriculture to trim its forecast of the size of the soy crop by about 0.8 percent, analysts said.
However, sluggish demand for U.S. soybeans from exporters and domestic crushers will help to offset some of the harvest shortfall, leaving only a slight drop from August in 2011/12 soy inventory forecasts.