Tuesday, September 20, 2011

20110920 1807 FCPO EOD Daily Chart Study.

FCPO closed : 3067, changed : +26 points, volume : higher.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : resume rising, buyer taking chances.
Support : 3050, 3020, 2970, 2950 level.
Resistance : 3070, 3100, 3150, 3200 level.
Comment :
FCPO closed recorded gain with improved volume transacted while overnight soy oil ended severely lower and currently rebounding higher while crude oil currently trading higher.
Both ITS and SGS cargo surveyor reported lower but recovering export data today while Reuters news reported that India trade body to seeks increase import tariff on refined palm oil to $1,150 per tonne in line with current market price.
Daily chart formed an up bar candle closed in between middle and upper Bollinger band level after market opened lower, moved downwards tested near support level and swing upwards into positive territory and closed near the high of the day.
Chart reading still suggesting a side way range bound little upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110920 1738 FKLI EOD Daily Chart Study.


FKLI closed : 1408.5, changed : +3 points, volume : higher.
Bollinger band reading : downside biased with possible pullback correction.
MACD Histrogram : falling, seller taking chances.
Support : 1405, 1395, 1385, 1375 level.
Resistance : 1425, 1445, 1458, 1470 level.
Comment :
FKLI closed recorded small gain with better volume participation doing about 2 points discount compare to cash market that ended little lower. Overnight U.S. market closed lower after 5 days of climbs and Asia markets ended mixed while European markets currently trading lower.
Market traded in negative zone earlier after Italy credit rating downgraded by S&P but some markets recovered on speculation that U.S. Federal Reserve officials will probably announce a new program for monetary easing tomorrow.
Daily chart formed an up doji bar candle closed at lower Bollinger band level after market opened weaker, dipping lower tested near support level and traded zigzag between gain and losses before closed little higher.
Chart study suggesting a downside biased market development testing support and resistance level with potential upward pullback correction.
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.

20110920 1713 Regional Markets EOD Daily Chart Study.

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

20110920 1608 Global Market & Commodities Related News.

Stocks Climb in Europe as Technology Companies Gain; U.S. Futures Advance (Bloomberg)
European stocks climbed, erasing earlier losses, as technology and construction companies rose. U.S. futures were little changed, while Asian shares dropped. SAP AG (SAP) gained 1.2 percent after a U.S. judge asked Oracle Corp. to consider revising its request for a review of a court order overturning a damage award against the German software maker. A gauge of technology companies gained 1.4 percent. EON AG and RWE AG (RWE) both climbed more than 3 percent after a court suspended a tax on companies that use nuclear fuel. The Stoxx Europe 600 Index rose 0.7 percent to 226.58 at 8:59 a.m. in London. Standard & Poor’s 500 Index futures expiring in December rose 0.1 percent, while the MSCI Asia Pacific Index slipped 0.8 percent.

China’s Stocks Rise From 14-Month Low; Commodity Producers Gain (Bloomberg)
China stocks rose, with the benchmark index climbing from a 14-month low, as investors speculated recent declines were overdone. PetroChina Co. rebounded from a record low and China Construction Bank Corp. (939) advanced from its lowest close since January 2009. Anhui Conch Cement Co. paced gains for building material producers after Premier Wen Jiabao said China will continue to promote the construction of public rental housing. The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, added 0.4 percent to 2,447.76 at the 3 p.m. close, rising from its lowest level since July 16, 2010. The CSI 300 Index (SHSZ300) gained 0.4 percent to 2,689.84 today.

U.S. Stock Futures Pare Losses; S&P 500 Contract Declines 0.1% (Bloomberg)
U.S. stock futures pared their decline, with futures on the Standard & Poor’s 500 Index expiring in December slipping 0.1 percent to 1,196.3 as of 8:38 a.m. in London. Equities slumped yesterday, halting a five-day rally for the S&P 500, amid concern Greece will fail to qualify for more financial aid needed to avoid default. During the trading session that ended at 4 p.m., Bank of America Corp. and JPMorgan Chase & Co. slid at least 2.8 percent, following a slump in European lenders. Alcoa Inc. lost 3.3 percent, pacing declines in commodity producers. Hewlett-Packard Co. dropped 2.6 percent as companies most-dependent on economic growth fell.

FOREX-Euro tumbles on Italy downgrade, Greece worries
TOKYO, Sept 20 (Reuters) - The euro slid sharply, moving closer to a seven-month low against the greenback after Standard and Poor's cut its debt rating on Italy and as investors fret over whether Greece can borrow badly needed cash from international lenders.
"The downgrade is clearly negative for the euro, but I don't think anyone at this stage is particularly surprised or shocked that it has happened," said Teppei Ino, a currency analyst at Bank of Tokyo-Mitsubishi UFJ in Tokyo.

Tokyo Steel to lift Oct product prices
TOKYO, Sept 20 (Reuters) - Tokyo Steel Manufacturing Co , Japan's biggest construction steelmaker, said on Tuesday it will raise all product prices in October for the first time in seven months amid signs of robust growth in demand from the construction market.  
The company will raise prices of products such as rebars, wire rods and shapes by 3,000 to 5,000 yen ($39-65) per tonne. The price of H-shape beams will rise by 5,000 yen to 79,000 yen.

Brazil's CSA sees steel output up 67 pct by 2012
RIO DE JANEIRO, Sept 19 (Reuters) - ThyssenKrupp's  $6.5 billion Rio de Janeiro slab mill will raise output by 67 percent to 5 million tonnes per year by 2012, a company official said on Monday.
CSA ThyssenKrupp, a joint venture with Brazilian mining giant Vale, is ramping up production despite a slowdown in the United States and Europe and turmoil in global capital markets, Financial Vice President Rodrigo Tostes said in an interview.

China's steel demand growth seen to weaken -CISA
SHANGHAI, Sept 20 (Reuters) - Growth in steel demand in China is expected to slow in near future and prices will fluctuate in response to the gloomy global economy, the China Iron & Steel Association (CISA) said on Tuesday in its monthly report.
"Steel oversupply will hardly improve as steel output remains high amid slowing growth of steel-consuming sectors and growing difficulties in steel exports," CISA said.

Ukraine Sept steel output seen steady - Union
KIEV, Sept 19 (Reuters) - Ukraine is likely to marginally raise its crude steel output to 3.06 million tonnes in September from 3.03 million in August, Ukrainian specialist news agency UGMK said on Monday.
The agency quoted local steel producers' union Metalurgprom as saying Ukraine was likely to produce 3.03 million tonnes of steel in October.

Italy 8-month steel output up 11.2 pct yr/yr-industry
MILAN, Sept 19 (Reuters) - Steel output in Italy, the European Union's second-biggest producer after Germany, rose 11.2 percent year-on-year to 18.695 million tonnes in the first eight months of 2011, industry body Federacciai said on Monday.  
In August alone, Italy's steel output jumped 25.6 percent to 1.385 million tonnes, according to data published on Federacciai's website.

Mongolia mining curbs key for environment-president
NEW YORK, Sept 19 (Reuters) - Mongolia's law banning mining in the country's river and forest areas is necessary to protect the mineral-rich Asian country's environment and herdsmen's livelihoods, President Tsakhia Elbegdorj said on Monday.
"Half of the territory is covered by exploration licenses. I think that's enough," he said in an interview in New York on the sidelines of the United Nations General Assembly.

METALS-Copper steady at 9-mth low; Shanghai copper falls 1 pct
SHANGHAI, Sept 20 (Reuters) - London copper slipped 0.1 percent after dropping to more than nine-month lows in the previous session on concerns the global economic slowdown will crimp demand for the metal.
"Larger companies with access to bank credit to use copper for trade financing have been able to buy LME copper even if it is at a slight premium to ShFE copper since they can offset losses with the cheaper financing they get from a letter of credit," Du said.

PRECIOUS-Gold steady after Italy downgrade; Fed ahead
SINGAPORE, Sept 20 (Reuters) - Gold held steady, after Standard and Poor's downgrade of Italy's credit rating heightened worries about the euro zone debt crisis ahead of a key U.S. Federal Reserve policy meeting.
"We are seeing small buying interest," said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong. "Most people are waiting for the Fed meeting which is expected to show a clear direction."

20110920 1538 Global Market & Commodities Related News.

Asia stocks, euro fall after Italy downgrade
SINGAPORE, Sept 20 (Reuters) - Asian stocks and the euro fell after ratings agency S&P downgraded Italy and as Greece held talks with creditors to avoid running out of cash within weeks, amid worries that Europe's debt woes will pitch the global financial system into a full-blown banking crisis.
"It only adds to the contagion risk over Greece and has encouraged the flight to safety in markets here," said Stephen Roberts, a senior economist at Nomura in Sydney, pointing to a sharp fall in the Australian dollar  on the news.

Asian Stocks Drop as Italy’s Credit-Rating Cut Boosts Debt-Crisis Concerns (Bloomberg)
Asian stocks fell, extending a two- week decline on the region’s benchmark stock index, after Italy’s sovereign-credit ratings were cut, intensifying concern Europe’s debt crisis is worsening and may sour the earnings outlook for exporters, banks and commodity producers. BHP Billiton Ltd. (BHP), the world’s biggest mining company, dropped 2.1 percent in Sydney as crude and metal prices tumbled. Rio Tinto Group, the second-largest miner by sales, fell 1.9 percent, extending losses yesterday. Sony Corp. (6758) slumped 4.1 percent, leading exporters’ shares lower after Japanese markets resumed trading following yesterday’s public holiday. China Unicom (Hong Kong) Ltd., the nation’s No. 2 mobile phone carrier, rose 3.6 percent in Hong Kong after boosting subscribers.
The MSCI Asia Pacific Index dropped 1 percent to 117.28 as of 4:18 p.m. in Tokyo, with about twice as many stocks declining as advancing on the index. The gauge has fallen for the past two weeks on concern Europe’s crisis is spreading and on signs of slowing U.S. economic growth.

Indonesia to be top SE Asian corn importer in 2011
NUSA DUA, Indonesia, Sept 19 (Reuters) - Indonesia will become Southeast Asia's top corn importer this year, ending Malaysia's 15-year run, due to rising poultry demand and a poor domestic crop, the U.S.
Grains Council said on Monday.    
Southeast Asia's largest economy is likely to import 3.2 million tonnes of corn, versus about 1.6 million last year, Adel Yusupov, Southeast Asia regional director at the council, told Reuters.
 
India to begin soybean imports from 2015
NUSA DUA, Sept 19 (Reuters) - Domestic demand for soybeans in India, fueled by a growing population and economic wealth in the world's fifth-largest producer, will result in the country becoming a net importer by 2015, the United Soybean Board said on Monday.
India is the world's fifth-biggest soybean producer after the United States, Brazil, Argentina and China, and it contributes about 5 percent to global output.

China soybean imports seen up 5 pct in 2012
NUSA DUA, Indonesia, Sept 19 (Reuters) - Chinese soybean imports will rise at least 5 percent next year, boosted by growing demand from pig and poultry farmers coupled with an emphasis on corn self-sufficiency, the American Soybean Association said on Monday.
China, the world's top soybean importer, is expected to buy about 57 million tonnes for the year ending August 31, 2012, versus 53-54 million tonnes the year before, Danny Murphy, treasurer at the American Soybean Association, told Reuters.

U.S. grains rise 1 pct; strong dollar weighs
SINGAPORE, Sept 20 (Reuters) - U.S. wheat and soy futures gained around 1 percent as bargain hunters resurfaced after prices dropped in the previous session on concerns about the global economy, but a strong U.S. dollar was likely to cap gains.  
"There's probably not a lot of bullish U.S.-centric grain news out there. So, there's probably not a lot of fundamental news to push these markets higher," said Brett Cooper, a senior manager of markets at FCStone Australia.  

Indonesia Bulog sees 1.5 mln T rice stocks at year end-official
SINGAPORE, Sept 20 (Reuters) - Indonesia's Bulog expects to have 1.5 million tonnes of rice stocks at the end of 2011, an official at the state procurement agency said on Tuesday.
"The weather has not been favourable and there has been some pest and disease spreading, so the quality of 2011 rice is not very good. The government asked us to have 1.5 million tonnes of ending stocks in 2011," Muhammad Ismet, agriculture economist at Bulog, said.    

Western Canada harvest 78 pct done
Sept 19 (Reuters) - Western Canada's overall harvest moved to 78 percent complete, the Canadian Wheat Board said on Monday, ahead of the normal pace of 71 percent at this time of year.
The western Prairies got their first widespread frost last week, ending the growing season in most areas, except for western Alberta, the board said in a statement.

Bunge to expand Canada canola plant
Sept 19 (Reuters) - Bunge Ltd  said on Monday that it will boost capacity at a canola-processing plant in western Canada, adding to an expansion across the industry.
Bunge said it would more than double the current capacity of its 850-tonnes-per-day plant at Fort Saskatchewan, Alberta by 2014, pending necessary approvals.

Paraguay detects foot-and-mouth, halts beef exports
ASUNCION, Sept 19 (Reuters) - Paraguay halted beef exports until December and ordered the slaughter of hundreds of cattle on Monday after officials detected an outbreak of foot-and-mouth disease in the beef-exporting nation.
The outbreak is a tough blow for the fast-growing beef industry in the South American country, a top 10 global exporter that had been expected to post record exports this year due to solid demand from key markets Russia and Chile.

Rains ease Argentina farmland dryness, but more needed
BUENOS AIRES, Sept 19 (Reuters) - Weekend rains brought much-needed moisture to farming areas in Argentina, but growers in the corn belt urgently need more rainfall in order to press on with plantings, a weather forecaster said on Monday.
If severe dryness persists, many farmers could shelve plans to seed corn and sow soy instead when the planting season for the oilseed starts in October.

Brent crude steady above $109, euro zone woes weigh
SINGAPORE, Sept 20 (Reuters) - Brent crude futures steadied above $109, after two days of heavy losses on worries that a looming default by Greece will destabilise the global financial system, threaten global growth and pare oil consumption.
"Investors are very worried about Europe, and this is not just impacting oil but it is across the board to stocks and other markets," said Ken Hasegawa, a commodity derivatives manager at Japan's Newedge brokerage.

Australia lifts iron ore projections, coal lags
SYDNEY, Sept 20 (Reuters) - Australia lifted its projections for iron ore output and exports on Tuesday, defying concerns over the global economy as Asian demand roars along, though it cut its forecast for coal output on a slow recovery from natural disasters.
Exports of iron ore, a key steelmaking ingredient, are seen at 449 million tonnes -- 40 percent of global trade -- in fiscal 2012, a 3 percent increase from an earlier projection and a 10 percent rise on the previous year, as Japanese and Chinese steel output expands rapidly.

China's steel demand growth seen to weaken -CISA
SHANGHAI, Sept 20 (Reuters) - Growth in steel demand in China is expected to slow in near future and prices will fluctuate in response to the gloomy global economy, the China Iron & Steel Association (CISA) said on Tuesday in its monthly report.
"Steel oversupply will hardly improve as steel output remains high amid slowing growth of steel-consuming sectors and growing difficulties in steel exports," CISA said.

Brazil's CSA sees steel output up 67 pct by 2012
RIO DE JANEIRO, Sept 19 (Reuters) - ThyssenKrupp's  $6.5 billion Rio de Janeiro slab mill will raise output by 67 percent to 5 million tonnes per year by 2012, a company official said on Monday.
CSA ThyssenKrupp, a joint venture with Brazilian mining giant Vale, is ramping up production despite a slowdown in the United States and Europe and turmoil in global capital markets, Financial Vice President Rodrigo Tostes said in an interview.

Copper steady at 9-mth low; Shanghai copper falls 1 pct
SHANGHAI, Sept 20 (Reuters) - London copper slipped 0.1 percent after dropping to more than nine-month lows in the previous session on concerns the global economic slowdown will crimp demand for the metal.
"Copper is tracking the weakness in equities today, which have fallen on bad news from the euro zone. But losses are limited by arbitrage trading and trade financing deals in China," said Du Xiao Hua, a futures analyst at brokerage Dongzheng Futures.

China-N.Korea JV starts production at copper mine
HONG KONG, Sept 20 (Reuters) - A new copper mine in North Korea, majority owned by China's Wanxiang Resources, started production on Monday and is expected to supply up to 70,000 tonnes of copper concentrate per year to China.
The copper mine, in Hyesan in North Korea's Ryanggang province, was operated by Hyesan-China Joint Venture Mineral Co, China's Xinhua News Agency reported late on Monday, adding that the joint venture was set up on Nov. 1, 2007, between Wanxiang and North Korea's Ministry of Mining Industries.

Gold steady after Italy downgrade; Fed ahead
SINGAPORE, Sept 20 (Reuters) - Gold held steady, after Standard and Poor's downgrade of Italy's credit rating heightened worries about the euro zone debt crisis ahead of a key U.S. Federal Reserve policy meeting.
"We are seeing small buying interest," said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong. "Most people are waiting for the Fed meeting which is expected to show a clear direction."

Venezuela to halt gold exports with nationalization
CARACAS, Sept 19 (Reuters) - President Hugo Chavez's government formalized the nationalization of Venezuela's gold industry on Monday with a decree that prohibits exports of the metal and gives the state 55 percent of joint ventures.
The new law, published in the Official Gazette "with the aim of overturning the serious impact of the capitalist mining model," also fixes the royalty rate for gold mine projects at 13 percent in general.

Newmont CEO: Unload dollars, buy gold
COLORADO SPRINGS, Colo., Sept 19 (Reuters) - If you're holding a lot of U.S. dollars in your investment portfolio, the chief executive of Newmont Mining Corp  says you should dump them all in favor of gold.
The frank, if not unbiased, advice from the head of one of the world's largest gold miners comes as gold prices  flirt this month with all-time highs due in part to debt crises in Europe and the United States.

Chinese gold demand may rise 10 pct this year-WGC
MONTREAL, Sept 19 (Reuters) - Chinese gold demand could rise 10 percent, or around 70 tonnes, this year as consumers choose the metal as a form of wealth protection, the World Gold Council said on Monday.
China's gold demand stood at around 706 tonnes last year, according to the WGC, but burgeoning demand for the precious metal has the scope to lift that significantly.

20110920 1124 Global Market & Commodities Related News.

GLOBAL MARKETS -Asia stocks, euro fall after Italy downgrade
SINGAPORE, Sept 20 (Reuters) - Asian stocks and the euro fell on Tuesday after ratings agency S&P downgraded Italy and amid fears of a Greek default, as investors worried that the euro zone's debt woes will pitch the global financial system into a full-blown banking crisis.
"It only adds to the contagion risk over Greece and has encouraged the flight to safety in markets here," said Stephen Roberts, a senior economist at Nomura in Sydney, pointing to a sharp fall in the Australian dollar  on the news.

Asian Stocks Drop as Italy’s Credit-Rating Cut Boosts Debt-Crisis Concerns
Asian stocks fell, extending a two- week decline on the region’s benchmark stock index, after Italy’s sovereign credit ratings were cut, intensifying concern Europe’s debt crisis is worsening and may sour the outlook for exporters, banks and commodity producers. BHP Billiton Ltd. (BHP), the world’s biggest mining company, dropped 1.4 percent in Sydney as crude and metal prices tumbled. Rio Tinto Group, the second-largest miner by sales, fell 1.4 percent, extending losses yesterday. Sony Corp. slumped 4.3 percent, leading exporters’ shares lower after Japanese markets resumed trading following yesterday’s public holiday. China Unicom (Hong Kong) Ltd., the nation’s No. 2 mobile phone carrier, rose 2.5 percent in Hong Kong after boosting subscribers.
The MSCI Asia Pacific Index dropped 0.9 percent to 117.49 as of 11 a.m. in Tokyo, with almost three stocks declining for each that advanced on the index. The gauge has fallen for the past two weeks on concern Europe’s crisis is spreading and on signs of slowing U.S. economic growth. (Bloomberg)

World oil use seen up 27 percent by 2035
WASHINGTON, Sept 19 (Reuters) - The U.S. government on Monday said global oil consumption is likely grow by more than a quarter over the next quarter century, though proposed rules requiring automakers to improve fuel efficiency in the United States were not factored into the forecast.
World oil demand is expected to climb to 112.2 million barrels per day in 2035, the U.S. Energy Information Administration said in its annual international energy outlook. That would be up 27 percent from 88.20 million bpd in 2011 and is an increase of 1.4 percent over last year's EIA forecast.

Oil slumps for second day as euro fears dominate
NEW YORK, Sept 19 (Reuters) - Oil tumbled in a second day of heavy losses on Monday, with Brent crude reaching its lowest price in almost a month as escalating fears over the euro zone debt crisis triggered across-the-board selling of riskier assets.
"Markets are under pressure as the European finance ministers failed to come up with anything solid this weekend. There are some strong worries that Greece is not doing what's needed to get another round of aid," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.

NYMEX-Natural gas ends up after overnight contract low
NEW YORK, Sept 19 (Reuters) - Front-month U.S. natural gas futures ended higher on Monday after hitting a 6-1/2-month low in overnight trade, as technical buying after key support held offset concerns about fading autumn demand and ample supplies.
"The weather right now is demand-neutral, and I think we do break lower if we get another big storage build this week, but I don't see prices falling much below the $3.70 area," Gelber & Associates analyst Pax Saunders told Reuters.

Euro Coal Prices dip $1/T with oil
LONDON, Sept 19 (Reuters) -     Prompt physical coal prices fell again on Monday by 50 U.S. cents to $1.00 a tonne in line with oil's drop but overall the market continued to look fairly stable, utilities and traders said.
"The DES ARA market is being well-defended, as usual, although prices have ticked down a touch and even the FOB Richards Bay market, which looked like it was going to collapse last week, seems a bit more stable today," one European trader said.

COMMODITIES- Gold up as safe-haven demand returns; sugar dives
NEW YORK, Sept 16  (Reuters) - Gold jumped for the first time in three days on Friday as safe haven demand resurfaced following weak U.S. economic data, while oil fell sharply on euro zone troubles and a stronger dollar.
"It's clear that any kind of negative outcome in Europe could be very dangerous indeed," said Nic Brown, a commodities analyst at London's Natixis.

20110920 1040 Local & Global Economic Related News.

Automotive Sector : Malaysia Aug auto sales up 5.7% on year
Malaysia’s total vehicle sales in August rose 5.7% to 58,382 units from a year earlier, a trade body said on Monday. The Malaysian Automotive Association said sales volume was 16.0% higher than the previous month due to increased demand for cars during the festive season of Hari Raya.  The trade body also said sales for September 2011 is expected to be maintained at the August 2011 level. –Business Times


China: Home prices rise in all cities, defying state curbs
China‟s August new home prices rose in all 70 cities monitored for the first time this year, undercutting government efforts to cool the market through higher down payments and mortgage rates. Prices in Beijing advanced 1.9% from a year ago, while those in Shanghai increased 2.8%. New home prices climbed in 67 out of 70 cities in the first half this year and were up in all but two in July. (Bloomberg)

Greece: Loan talks will continue after “productive” meeting
Greece‟s Prime Minister George Papandreou‟s government will hold another call with its main creditors after a “productive” round of talks aimed at staving off default. Finance Minister Evangelos Venizelos held “substantive” discussions with European Union and IMF officials about securing a sixth installment of rescue funds, the finance ministry said. A second discussion will be held tonight. (Bloomberg)

Italy: Debt rating lowered by S&P on weaker growth outlook
Italy‟s credit rating was cut by S&P on concern that weakening economic growth and a “fragile” government means the nation won‟t be able to reduce the euro-region‟s second largest debt burden. The rating was lowered to A from A+, with a negative outlook. (Bloomberg)

US: Obama calls for trimming deficit with USD1.5trn in taxes
US President Baarck Obama cast himself as a champion of “fairness” for the middle class in the fight to reduce the deficit with a call for USD1.5trn in tax increases over the next decade, largely targeting the wealthy. He joined his call for a tax increase with a threat to veto any legislation Congress sends him that would reduce benefits from the Medicare health insurance plan for the elderly unless wealthy Americans also face higher taxes. (Bloomberg)

US stocks decline amid concern Greece may not qualify for aid
US stocks retreated, following the longest rally since July for the S&P 500 Index, amid concern Greece will fail to qualify for more financial aid needed to avoid a debt default. Stocks pared losses in the final hour of trading as Greece said discussions with European officials about the country‟s bailout were productive. Bank of America Corp and JPMorgan Chase & Co. slid at least 2.8%, following a slump in European lenders. The Dow Jones Industrial Average fell 108.08 points to 11,401.01. (Bloomberg)

Global: Merkel pledges “concerted action” to Obama
US President Barack Obama and German Chancellor Angela Merkel on Monday spoke by phone as doubts re-emerged in markets as to the likelihood of Greece defaulting. According to a White House statement, the two leaders agreed "concerted action would be needed in the months ahead to address the current economic challenges and to assure global economic recovery." Merkel's party was defeated in a regional election over the weekend, in a result seen as making Germany even more reluctant to participate in any Greek rescue effort. (Bloomberg)

20110920 1039 Malaysia Corporate Related News.

BDRB to sell four assets for RM914m
Bandar Raya Development (BDRB) has decided to part with four investment properties, including its crown jewel BSC, a preliminary cash consideration of RM430m with net liabilities of RM484m to be assumed by the buyer, valuing the entire transaction at RM914m. BRDB CEO Datuk Jaganath said the board has decided to accept the recent offer from its major shareholder Ambang Sehati SB to acquire four properties. They are BSC and Menara BRDB in Bangsar, CapSquare Retail Centre in KL and Permas Jusco Mall in Johor Bahru. (Financial Daily) Please see accompanying report

BCorp to raise RM767m
Berjaya Corp (BCorp) has proposed a renounceable rights issue of up to RM767.5m nominal value of new irredeemable convertible unsecured loan stocks with up to 767.5 m warrants. BCorp told Bursa Malaysia yesterday that the issue would be on the basis of one RM1 nominal value loan stock and one warrant for every six BCorp shares. The coupon rate is 5% a year. The proposed rights issue is undertaken primarily to enable the group to raise funds to part repay bank borrowings while the proceeds of the warrants would be used for working capital of BCorp group. (StarBiz)

Kimlun gets RM51m contract from Nusajaya Lifestyle
Kimlun Corp‟s unit has accepted the letter of award for a RM51m contract from Nusajaya Lifestyle SB to build a retail mall and ancillary buildings in Medini Iskandar, Johor Bahru. It said on Monday the scope of works comprises building construction and ancillary works for the Mall, which is due to be completed by July 2012. “The contract is expected to contribute positively to the earnings and net assets of Kimlun Group for the financial years ending 2011 to 2012,” it said. (Financial Daily)

Sime Darby in the limelight again
Sime Darby and Eastern and Oriental (E&O) continue to make the news as both their share prices moved again in opposite directions on speculation that the former will launch a general offer (GO) for the latter's shares. Sime Darby declined by 30 sen, seeing about RM1.8bn of its market capitalization wiped out, while there was active trading in E&O shares, which ended the day 2 sen up. The SC, which is looking into whether Sime Darby would be required to conduct a GO for the rest of the shares in E&O after buying a 30% block in the latter (at a 60% premium to market), has yet to make a decision on the matter. Meanwhile, major shareholder and part seller of the 30% block of E&O shares, Tan Sri Wan Azmi Wan Hamzah, said that there was absolutely no agreement or understanding between himself and Sime Darby on how he would exercise his voting rights on the remaining E&O shares he owns.
In other news, Sime Darby Industrial SB (SDI), which has an order book of RM3bn, is in talks to buy Bucyrus International. SDI executive vice president Scott William told the media yesterday that the company was currently in talks with Caterpillar, the owner of Bucyrus International, for the acquisition of the distribution assets. He said Sime Darby might announce the deal by the end of the year, adding that the acquisition would enable Sime Darby to extend the range of its products to cover both surface and underground mining equipment. (StarBiz, Financial Daily)

Thai AirAsia puts off IPO to 1Q next year
The Thai unit of Malaysia's AirAsia Bhd has delayed an initial public offering (IPO) of its shares to 1Q2012 from 4Q, its financial adviser said yesterday. The delay is because it needs more time to restructure its organization and conduct due diligence. Earlier this year, Thai AirAsia said it planned to raise up to USD200m (RM622m) from the IPO in Bangkok in the fourth quarter and the proceeds would be used partly for cash reserves and to repay debt. (Financial Daily)

Malaysian Airline System Bhd : MASkargo looks into possibility of collaborating with AirAsia Cargo
MASkargo, the air cargo subsidiary of Malaysian Airline System Bhd (MAS), is looking into the possibility of collaborating with AirAsia Cargo soon to create better synergy between the two companies. Managing Director Shahari Sulaiman said the collaboration would bring a positive impact to the cargo industry in Malaysia, domestically and regionally, due to the current rapid economic growth in the region. Shahari said the new freighters would allow MASkargo greater flexibility to develop new trade lanes between Asia, Europe and Australia which may not be viable using a bigger capacity aircraft. The A330 freighters are forecasted to increase MASkargo’s freighter capacity in 2012 by about 25.0%. – Bernama

Will Tenaga Nasional be split up?
Speculation of splitting Tenaga Nasional Bhd (TNB) up has resurfaced as the utility company faces an additional RM3bil in costs from having to look for alternative sources of fuel for power generation due to a shortage in gas supply. However, TNB president and chief executive officer Datuk Seri Che Khalib Mohd Noh did not respond  to StarBiz query on the matter. Analysts said there were a number of obstacles that would make any break-up  of the company unlikely at the moment. They pointed out that fixed energy prices and power-purchase agreements signed with the independent power producers were among the main reasons why there would not be any imminent split-up. (Source: The Star)

20110920 1035 Global Market Related News.

Asian Stocks Drop as Italy’s Credit-Rating Cut Boosts Debt-Crisis Concerns (Source: Bloomberg)
Asian stocks fell, driving a regional benchmark stock index lower for a second day, after Italy’s sovereign credit ratings were cut, intensifying concern a worsening debt crisis in Europe may hurt the earnings of exporters, banks and commodity producers. BHP Billiton Ltd. (BHP), the world’s biggest mining company, dropped 1.2 percent in Sydney as crude and metal prices tumbled. Rio Tinto Group, the No. 2 miner by sales, fell 1.2 percent, extending losses yesterday. Sony Corp. slumped 3.6 percent, leading Japanese exporters’ shares lower after markets resumed trading following yesterday’s public holiday. The MSCI Asia Pacific Index dropped 0.6 percent to 117.75 as of 10:09 a.m. in Tokyo. The gauge has fallen for past two weeks. About four stocks declined for each two that advanced on the index today. The MSCI Asia Pacific excluding Japan Index lost 2.8 percent yesterday after European policy makers failed to introduce a plan to stem the region’s debt crisis.

GLOBAL MARKETS - Stocks, euro tumble as default fears mount
LONDON, Sept 19 (Reuters) - World stocks and the euro fell sharply on Monday, hit by the lack of progress from finance ministers in solving Europe's debt crisis at weekend meetings and avoiding a default by Greece.
"It's no more a link between markets and economics, but a link between markets and politics. The politicians should have seen the crisis coming and done more, but the problem is they are not proactive," said Koen De Leus, strategist at KBC Securities, in Brussels.

Stocks, euro tumble as default fears mount
LONDON, Sept 19 (Reuters) - World stocks and the euro fell sharply, hit by the lack of progress from finance ministers in solving Europe's debt crisis at weekend meetings and avoiding a default by Greece.
"It's no more a link between markets and economics, but a link between markets and politics. The politicians should have seen the crisis coming and done more, but the problem is they are not proactive," said Koen De Leus, strategist at KBC Securities, in Brussels.

Shultz Says It’s Time to ‘Clean House’ With U.S. Tax Code to Boost Economy (Source: Bloomberg)
George P. Shultz, a former head of the U.S. Treasury and onetime secretary of state, called for the elimination of tax preferences to stimulate the economy and increase government revenue. “It’s time to clean house again,” Shultz, who headed the State Department for President Ronald Reagan in the 1980s, said yesterday in an interview at Bloomberg headquarters in New York. “The 1986 tax act is sort of the unsung hero of the very good economic times we had for a long time. Of course, politics gums it all up again and preferences get put in.” The Tax Reform Act of 1986 lowered some rates and equalized the treatment of capital gains and ordinary income. Congress has since raised the top income-tax rate to 35 percent and dropped the top capital-gains rate to 15 percent. Shultz, 90, said a simplification of the code would allow Congress to lower rates on a “revenue-neutral” basis, while economic expansion would boost tax receipts.

Bernanke Joins King Tolerating Inflation (Source: Bloomberg)
Inflation flashing red may be less of a green light for higher interest rates as global growth falters. Some Federal Reserve policy makers favor keeping their benchmark rate close to zero until price increases reach a level Vincent Reinhart, a former top official, says could be 3 percent. The Bank of England has held its key rate at a record low even as U.K. inflation breached its 2 percent target for 21 months. Brazil executed a surprise cut Aug. 31 to safeguard its economy even after inflation quickened to a six-year high. Policy makers such as Fed Chairman Ben S. Bernanke and Bank of England Governor Mervyn King may be challenging central-bank orthodoxy to replenish depleted toolkits and support recoveries at risk of sliding back into recession. Tolerating higher inflation may make long-term Treasuries less attractive while supporting stocks and commodity prices, said Jim Kochan, chief fixed-income strategist at Wells Fargo Advantage Funds.

Obama Plan to Trim Deficit With $1.5 Trillion in Taxes (Source: Bloomberg)
President Barack Obama cast himself as a champion of “fairness” for the middle class in the fight to reduce the deficit with a call for $1.5 trillion in tax increases over the next decade, largely targeting the wealthy. Obama joined his call for a tax increase with a threat to veto any legislation Congress sends him that would reduce benefits from the Medicare health-insurance plan for the elderly unless wealthy Americans also face higher taxes. “This is not class warfare, it’s math,” Obama said this morning at the White House as he unveiled his recommendations to a 12-member congressional committee charged with finding ways to trim at least $1.5 trillion from the deficit. “The money’s going to have to come from someplace.”

Geithner: Europe Will Follow ‘Lessons’ of U.S. (Source: Bloomberg)
U.S. Treasury Secretary Timothy F. Geithner predicted that Europe will adopt some of the same measures the U.S. took to battle the financial crisis that started in 2008. “I think you’re going to see them draw on the lessons of our crisis, draw on the lessons of things that worked here in the United States,” Geithner said in a Bloomberg Television interview today in Washington. “I think you’ll see that reflected in some of the choices they make.” In the aftermath of the September 2008 bankruptcy of Lehman Brothers Holdings Inc., the U.S. adopted the $700 billion Troubled Asset Relief Program and the Federal Reserve conducted stress tests of the 19 largest financial institutions to ensure their capital was adequate to withstand a more severe economic downturn. The Fed also set up the Term Asset-Backed Securities Loan Facility, or TALF, to keep consumer credit flowing.

Treasuries Rise, Sending Two-Year Yield to Record Low, as Italy Downgraded (Source: Bloomberg)
Treasury two-year yields extended their decline to a record low after Italy’s credit rating was cut by Standard & Poor’s, fueling demand for the relative safety of U.S. debt. Traders reduced inflation bets on speculation economic growth will slow in Europe and the U.S. The difference between yields on 10-year notes and Treasury Inflation Protected Securities, a gauge of trader expectations for consumer prices over the life of the debt, narrowed to 1.84 percentage points, the least in 11 months. The average over the past five years is 2.06 percentage points. “Yields can push down further,” said Hiroki Shimazu, an economist in Tokyo at SMBC Nikko Securities Inc., a unit of Japan’s third-largest publicly traded bank by assets. “European officials are failing to resolve the crisis. That will damage the world economy.”

U.S. Stocks Decline as Investors Weigh Greece (Source: Bloomberg)
U.S. stocks retreated, following the longest rally since July for the Standard & Poor’s 500 Index, amid concern Greece will fail to qualify for more financial aid needed to avoid a debt default. Stocks pared losses in the final hour of trading as Greece said discussions with European officials about the country’s bailout were productive. Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) slid at least 2.8 percent, following a slump in European lenders. Alcoa Inc. (AA) sank 3.3 percent, pacing declines in commodity producers. Hewlett-Packard Co. (HPQ) dropped 2.6 percent as companies most-dependent on economic growth tumbled. The S&P 500 lost 1 percent to 1,204.09 at 4 p.m. New York time, paring a decline of 2.3 percent. It rallied five straight days last week as government officials and central bankers took steps to ease Europe’s debt crisis. The Dow Jones Industrial Average fell 108.08 points, or 0.9 percent, to 11,401.01.

China August Home Prices Rise in All Cities, Challenging Government Curbs (Source: Bloomberg)
China’s August new-home prices rose in all 70 cities monitored for the first time this year, undercutting government efforts to cool the market through higher down-payments and mortgage rates. Prices in Beijing advanced 1.9 percent from a year ago, while those in Shanghai, the nation’s financial center, increased 2.8 percent, the statistics bureau said on its website yesterday. New home prices climbed in 67 out of 70 cities in the first half this year and were up in all but two in July. China’s measures to control its property market are at a critical stage and the nation needs to focus efforts on curbing price increases in less affluent cities after limiting home purchases by each family in metropolitan areas including Beijing and Shanghai, Premier Wen Jiabao said on Sept. 1. Only two cities responded to the government’s July call for added restrictions on housing purchases, as local governments rely on land sales to pay mounting debt.

China Will Likely Limit Stimulus in Any Global Slump, Deutsche Bank Says (Source: Bloomberg)
China’s stimulus in any world economic slump is unlikely to be more than half the nation’s estimated 9.3 trillion yuan ($1.46 trillion) fiscal and monetary expansion from November 2008 through 2010, Deutsche Bank AG said. While highly speculative, a sketch of the government’s possible response is emerging from “our discussions in China,” Hong Kong-based economist Ma Jun said in a note dated Sept. 16. The government would limit any measures because of the costs associated with the previous package, including asset bubbles, inflation and non-performing loans, Ma said. China’s government is wrestling with elevated inflation and the threat of a deeper economic slowdown because of the debt crisis in Europe, the nation’s biggest export market, and weakness in the U.S. economy. Deutsche forecasts that China’s growth may cool to 7.3 percent in the first quarter of next year compared with 9.5 percent in the second quarter of 2011.

China Slowdown Looms as Inflation Limits Stimulus, ex-PBOC Official Says (Source: Bloomberg)
China’s economy is highly likely to slow next year and efforts to spur growth will be constrained by inflation and government debt burdens, said Wu Xiaoling, a former deputy central bank governor. The government shouldn’t expand monetary or fiscal stimulus because of price pressures and central and local-government debt, Wu said in comments published today by the Financial News, the central bank’s newspaper. Wu is vice director of the finance and economy committee of the National People’s Congress. The world’s biggest exporting nation faces weakening global demand because of the European debt crisis and U.S. unemployment. China’s officials are still grappling with the side-effects of 2008 and 2009 stimulus measures, including elevated inflation and the risk of bad loans for banks.

China’s Stocks Fall to 14-Month Low on Tightening Concern, IPOs (Source: Bloomberg)
China’s stocks fell to a 14-month low after Premier Wen Jiabao said the government will take measures to control inflation and investors speculated pending initial public offerings will sap demand for existing equities. Industrial & Commercial Bank of China (601398) Ltd. and Poly Real Estate Group Co. paced declines by banks and developers as a government report showing new-home prices increased in all cities boosted odds of more monetary tightening. Sinoma International Engineering Co. (600970) slid 2.4 percent on the prospect Sinohydro Group Ltd.’s planned offering, China’s biggest in almost a year, will divert funds from other construction stocks. “The upcoming big IPOs are a major reason for the market plunge, draining liquidity in the market,” said Tu Jun, a strategist at Shanghai Securities Co. “It’s not a good time for fund-raising but the government’s tight monetary policy has left companies with no other choice.”

Japanese Stocks Decline as Italy Rating Cut Fuels Europe Contagion Concern (Source: Bloomberg)
Japanese stocks fell, driving the Nikkei 225 (NKY) Stock Average down for the first time in three days, after Standard & Poor’s downgrade of Italy’s credit rating reinforced concern Europe’s debt crisis is spreading. Sony Corp. (6758), which depends on Europe for 20 percent of its sales, fell 4 percent as a slide in the euro cut its earnings outlook. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s biggest lender by market value, fell 1.7 percent on concern Europe’s debt crisis will spill into the banking system. Shippers declined, with Mitsui O.S.K. Lines Ltd. losing 5.3 percent, as a measure of cargo rates fell for a third day. The Nikkei 225 fell 1.3 percent to 8,752.77 as of 10:42 a.m. in Tokyo. The broader Topix index dropped 1.4 percent to 757.43. Japan’s stock markets were closed yesterday for a public holiday when the MSCI Asia Pacific excluding Japan Index declined 2.8 percent on concern Greece is moving closer to default.

S&P Cuts Italy Rating as Government Debt Mounts (Source: Bloomberg)
Italy’s credit rating was cut by Standard & Poor’s on concern that weakening economic growth and a “fragile” government mean the nation won’t be able to reduce the euro-region’s second-largest debt burden. The rating was lowered to A from A+, with a negative outlook, S&P said in a statement. S&P said Italy’s net general government debt is the highest among A-rated sovereigns, and the company now expects it to peak later and at a higher level than it previously anticipated. The decision sent the euro sliding for a third day against the dollar as investor concern rises that European policy makers will fail to contain the debt crisis. Greece’s government plans another call with its main creditors today as it seeks to stave off default, while U.S. Treasury Timothy F. Geithner urged the region to adopt additional tools.

Greece Talks to Continue After ‘Productive’ Call (Source: Bloomberg)
Prime Minister George Papandreou’s government will hold another call with its main creditors after a “productive” round of talks aimed at staving off default. Finance Minister Evangelos Venizelos held “substantive” discussions with European Union and International Monetary Fund officials about securing a sixth installment of rescue funds, the Athens-based finance ministry said in an e-mailed statement after a teleconference last night. A second call will be held tonight. U.S. stocks pared losses after the statement. As Papandreou fights investor doubts and domestic opposition, European leaders are squabbling over the terms of the July agreement and the prospect that they will be forced to channel more money to keep Greece in the currency union. U.S. Treasury Secretary Timothy F. Geithner said in an interview yesterday that Europe will eventually adopt some of the same measures the U.S. took after the 2008 financial crisis.

Bank of England Says Bond Purchases had ‘Economically Significant’ Impact (Source: Bloomberg)
The Bank of England said its bond- purchase plan had “economically significant” effects on Britain’s financial system, though the impact of future purchases may differ. The 200 billion pounds ($316 billion) of securities bought since March 2009 in so-called quantitative easing may have raised gross domestic product by 1.5 percent to 2 percent, and increased inflation by between 0.75 to 1.5 percentage points, the bank said in its Quarterly Bulletin in London today. “There is considerable uncertainty around these estimates and the precise impact of asset purchases or sales is likely to vary depending on the circumstances in which they are conducted,” Chief Economist Spencer Dale wrote in the forward. Continuing assessment will “inform any future decisions on either selling the assets back, or making further purchases.”

London Home Prices Surge as Investors Turn to Property Amid Market Turmoil (Source: Bloomberg)
London home sellers raised asking prices by the most in seven months in September as a lack of properties for sale and investors looking for safer assets amid financial-market turmoil bolstered values, Rightmove Plc said. Asking prices rose 2.4 percent from August, when they fell 3.4 percent, the property website said in an e-mailed report today. Separate data from Rightmove showed national home values gained 0.7 percent after a 2.1 percent decline in August. While values are being supported by record-low interest rates, waning consumer confidence and lenders’ insistence on large deposits are preventing the housing market from gaining momentum. Demand in London has been boosted by cash-rich buyers investing in property amid European financial volatility over attempts to avert a Greek default, Rightmove said.

Euro Weakens on Debt Crisis Plan Concern, Pares Its Loss After Greek Call (Source: Bloomberg)
The euro weakened to almost a seven-month low against the dollar after European officials failed last week to offer a plan to halt the region’s debt crisis as Greece struggles to avoid default. The 17-nation currency pared losses against its major counterparts after the Greek Finance Ministry said a conference call with the European Union and International Monetary Fund was productive. The dollar rose against all its major counterparts except the yen as Treasury two-year yields fell to a record before the Federal Reserve begins its two-day meeting tomorrow. Norway’s krone fell as oil prices declined. “The Greek government is trying to do what it’s being asked to do and my core case is that we get a disbursement of the quarterly tranche, but that doesn’t mean we won’t have the same issue in December,” said Jens Nordvig, a managing director of currency research in New York at Nomura Holdings Inc. Nordvig spoke on a Bloomberg Television interview with Carol Massar and Matt Miller on “Street Smart.”

Greece Aid Talks Will Continue After ‘Productive’ Meeting (Source: Bloomberg)
Prime Minister George Papandreou’s government will hold another call with its main creditors tomorrow after a “productive” round of talks aimed at staving off default. Finance Minister Evangelos Venizelos held “substantive” discussions with European Union and International Monetary Fund officials about securing a sixth instalment of rescue funds, the Athens-based finance ministry said in an e-mailed statement after a teleconference tonight. A second call will be held tomorrow evening. U.S. stocks pared losses after the statement. As Papandreou fights investor doubts and domestic opposition, European leaders are squabbling over the terms of the July agreement and the prospect that they will be forced to channel more money to keep Greece in the currency union. U.S. Treasury Secretary Timothy F. Geithner said in an interview today that Europe will eventually adopt some of the same measures the U.S. took after the 2008 financial crisis.

European Stocks Drop Amid Speculation on Greek Aid Payment; Michelin Sinks (Source: Bloomberg)
European stocks slid, halting a four-day rally for the Stoxx Europe 600 Index, as investors speculated that Greece may not receive an aid payment that would help it avoid default. Deutsche Bank AG (DBK) led banks lower after Germany’s ruling party lost another regional election. Mining companies and oil producers fell as base metals and crude oil dropped, while Michelin & Cie. declined after Morgan Stanley downgraded the tiremaker. The benchmark Stoxx 600 dropped 2.3 percent to 224.96 at the 4:30 p.m. close in London, paring last week’s 2.5 percent advance. The gauge has declined 23 percent from this year’s peak on Feb. 17 as the region’s growing debt crisis added to concern that the economic recovery is at risk.

Australian Dollar Erases Earlier Drop After Reserve Bank Minutes Published (Source: Bloomberg)
The Australian dollar erased earlier declines after the Reserve Bank said it was concerned whether inflation would be contained, in minutes of the Sept. 6 policy meeting that were published today. The currency traded at $1.0231 as of 11:33 a.m. in Sydney from $1.0193 before the minutes. The so-called Aussie earlier dropped to as low as $1.0149 from $1.0222 yesterday in New York.

20110920 1034 Global Commodities Related News.

Commodities Fall on Europe Debt Worries (Source: Bloomberg)
Commodities fell the most in a month as gains in the dollar eroded demand for raw materials amid concern that Greece may fail to qualify for more financial aid needed to avoid default. Greece’s Finance Ministry said it had a “productive and substantive discussion” with international officials who will determine if the country qualifies for further bailout funds. The dollar rose as much as 1.2 percent against a basket of six major currencies, eroding the appeal of raw materials. “Today was more about dollar strength driven by the deteriorating global economy,” James Dailey, who manages $215 million at TEAM Financial Management LLC in Harrisburg, Pennsylvania, said in a telephone interview. “Traders were moving away from riskier assets.”

Corn (Source: CME)
US corn futures end mixed, rallying from sharp early losses on expectations of renewed export demand. Traders noted rumors that China was poised to re-enter the market as a buyer, of either U.S. or Argentina corn. That helped stanch the market's recent bleeding and kept the December contract above the 100-day moving average on a closing basis. Traders add that even with recent anecdotal reports of better-than-expected yields, supplies will remain tight. End-users' reluctance to buy, based on expectations the market could decline further, have weighed on the market recently. Prices also restrained by a stronger dollar, and worries about the economy. Dec corn ends up 1/4c to $6.92 1/4, 15c off the day's low.

Wheat (Source: CME)
U.S. wheat futures end lower, succumbing to outside market pressure and a lack of supportive fundamental news. Wheat and soybeans both under pressure all day, thanks to a stronger U.S. dollar and worries about the economy along with Europe's debt crisis. Meanwhile wheat demand is sluggish, which is also keeping prices under pressure. Worries about the U.S. spring wheat crop in the northern Plains, along with concerns about how farmers will plant a winter wheat crop in drought-parched soils, limited losses. CBOT Dec wheat ends down 15 1/4c, or 2.2%, to $6.73 a bushel. KCBT Dec wheat ends down 16c to $7.68 and MGEX wheat closes down 14 1/2c to $8.41 3/4.

Rice (Source: CME)
U.S. rice futures fall sharply on outside market pressure and a lack of demand. A stronger dollar, which is negative for U.S. exports, and worries about the broader economy weighed on grains markets generally. Traders are still assessing the current U.S. harvest. Meanwhile, demand remains sluggish and world supplies are seen as comfortable. CBOT Nov rice closes down 2.8%, or 50c, the daily trading limit, to $17.39 a bushel.

US Corn Yields Likely 149-150 Bushels/Acre - Executive (Source: CME)
U.S. corn yields may be revised upwards to 149-150 bushels/acre in the next few months due to a better-than-expected crop in many states, a senior industry executive said. The U.S. Department of Agriculture, in a monthly report last week, pegged the average corn yield at 148.1 bushels/acre, down from an earlier forecast of 153 bushels. In many areas, such as North Dakota, South Dakota, northern Iowa and Minnesota, the yields seem to be underestimated and could be revised higher, Frank Kralicek, member of the Asia Advisory Team of the U.S. Grains Council, said on the sidelines of an international agriculture conference here. "It (yields) can't get worse than this because most of crop that was in poor condition due to adverse weather has already been harvested," Kralicek said. Earlier this month, some private analysts had forecast U.S. corn yields as low as 143-147 bushels/acre.

US corn at 5-week low, wheat falls on risk aversion
SINGAPORE, Sept 19 (Reuters) - U.S. corn slid 0.7 percent to its lowest in 5 weeks, while wheat fell for a third straight session, as the euro zone debt crisis triggered a selloff in commodity markets including oil and metals.
"Grains have moved lower following a pretty significant move lower in the crude oil market and a sharp rally in the dollar index. Quite clearly the risk is coming off the table and grains are getting caught in that," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia.

India to begin soybean imports from 2015
NUSA DUA, Sept 19 (Reuters) - Domestic demand for soybeans in India, fueled by a growing population and economic wealth in the world's fifth-largest producer, will result in the country becoming a net importer by 2015, the United Soybean Board said on Monday.
India is the world's fifth-biggest soybean producer after the United States, Brazil, Argentina and China, and it contributes about 5 percent to global output.

China soybean imports seen up 5 pct in 2012
NUSA DUA, Indonesia, Sept 19 (Reuters) - Chinese soybean imports will rise at least 5 percent next year, boosted by growing demand from pig and poultry farmers coupled with an emphasis on corn self-sufficiency, the American Soybean Association said on Monday.
China, the world's top soybean importer, is expected to buy about 57 million tonnes for the year ending August 31, 2012, versus 53-54 million tonnes the year before, Danny Murphy, treasurer at the American Soybean Association, told Reuters.

Egypt should export niche rice again-specialist
CAIRO, Sept 18 (Reuters) - Egypt, once a major player in the global rice market, should resume exports of the grain which can command premium prices abroad and import cheaper strains for its food subsidy programme, an Egyptian rice expert said
Egyptian rice, now sold for $250 a tonne as part of the government's subsidy programme, could fetch as much as $900 a tonne if exported, Mostafa El Naggari, who is also a member of the country's Agricultural Export Council, told Reuters.

North Australia faces more rain, balanced outlook in grain belt
SYDNEY, Sept 19 (Reuters) - Above-average rainfall is more likely in north Australia in the last quarter of 2011, but the chances of a drier or wetter October to December period are roughly equal across much of the  grain belts, the bureau of meteorology said on Monday.
The chances of receiving above average rainfall in the quarter are between 60 and 75 percent over the Northern Territories, the northern half of Queensland and western and northern parts of Western Australia, the bureau of meteorology said in its latest seasonal outlook.

Cold front may hit crops in China - weather office
SHANGHAI, Sep 17 (Reuters) - Grain producers in North China should take precaution against an oncoming strong cold front in the next three days that could bring frost and heavy rains to certain areas, China's National Meteorological Center (NMC) said in a statement on Saturday.
Temperatures are estimated to drop by four to eight degrees Celsius north of the Yangtze River, and more than 10 degrees in northern North China and southern Northeast China.
 
Concern grows over thirsty Argentine wheat -gov't  
BUENOS AIRES, Sept 16 (Reuters) - Crops in much of Argentina's No. 1 wheat-growing province are suffering from dry weather and the need for rain is becoming urgent in some districts, the Agriculture Ministry said on Friday.
Argentina, a leading wheat supplier to neighboring Brazil, 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.

Britain approves trial for GM wheat in 2012, 2013
LONDON, Sept 16 (Reuters) - Britain's farm ministry said on Friday it has granted approval for a research trial in 2012 and 2013 on genetically modified wheat which is resistant to aphids.
"The research is on wheat that has been genetically modified to resist aphids, which are a pest in wheat crops," the ministry said in a statement.

Competitive wheat to grab feed sales in Europe
Sept 16 (Reuters) - Wheat is on course to claim more of the animal-feed market in western Europe this season versus relatively expensive maize and barley, but this demand picture could be altered by the upcoming maize harvest, analysts and operators said.
Tight maize (corn) supply in the United States, the world's top producer and exporter, has been reinforced by a weather-related decline in production prospects for this year's U.S. crop, leading to the unusual situation in which corn prices have surpassed those of wheat on both sides of the Atlantic.

Ukraine harvests 1.04 mln T maize so far - AgMin
KIEV, Sept 16 (Reuters) - Ukraine, which plans to harvest a record 20 million tonnes of maize in 2011, threshed 1.04 million tonnes of the commodity as of September 16, the Agriculture Ministry said on Friday.
The ministry said farms harvested 206,000 hectares of maize and the yield averaged 5.07 tonne per hectare. At the same date in 2010 farms harvested 2.69 million tonnes of maize with the average yield of 3.9 tonne per hectare.
 
Bangladesh turns to India for wheat, shifts from Black Sea
DHAKA, Sept 16 (Reuters) - The bulk of India's 2 million tonnes of planned wheat exports are likely to end up in Bangladesh, traders said, as the country shifts away from Black sea supplies on competitive prices for grains from its neighbour.
Last week, India allowed unrestricted exports of two million tonnes each of wheat and common rice, as the unmanageable level of the country's stocks forced the authorities to allow overseas sales.

Sugar consolidates after slide, cocoa slips
LONDON, Sept 19 (Reuters) - ICE raw sugar futures consolidated and arabicas dipped in early trade, weighed by a firmer dollar as dealers focused on prospects for Indian sugar exports, while cocoa eased pressured by the coming West African main crop harvests.
Prospects for large northern hemisphere crops in the fourth quarter, notably in Russia, Ukraine and EU countries, also weighed on sugar futures prices.

Egypt's Alcotexa sells 392 T cotton in new season
CAIRO, Sept 19 (Reuters) - Egypt's Alexandria Cotton Exporters' Association (Alcotexa) committed to sell 392 tonnes of cotton in the new season 2011/2012 which started in September, an Alcotexa official told Reuters on Monday.
The sales comprised 342 tonnes of Giza 88 and 50 tonnes of Giza 86.Alcotexa did not announce the price for the new season yet, the officil said.

Colombia coffee farmers doubt 2011 output target
BOGOTA, Sept 16 (Reuters) - Some Colombian coffee growers and exporters doubt the main harvest in 2011 will be enough to meet the country's output target after torrential rains hurt plantations and led to fungus.
Colombia's coffee output fell for a fifth consecutive month in August and farmers reached by Reuters on Friday were not optimistic about the outlook for the rest of the year.

Brazil sugar vessel line-up shortest of 2011/12
SAO PAULO, Sept 16 (Reuters) - Brazil's current sugar line-up is the smallest of the April-March season, data from shipping agencies showed on Friday, reinforcing market expectations of a drop in exports in September,
September has been a month of record sugar shipments over the past few years, when Brazil's main center-south cane region produced record outputs. This season, however, both production and exports should fall following a steep drop in cane output.

Oil Climbs for First Day in Three in New York Trading; Brent Crude Gains (Source: Bloomberg)
Oil gained for the first day in three in New York. Crude for October delivery rose as much as 35 cents, or 0.4 percent, to $86.05 a barrel in electronic trading on the New York Mercantile Exchange. It earlier dropped as much as 0.7 percent and slid 2.6 percent yesterday to the lowest settlement in almost three weeks. The October contract will expire today. The more actively traded November future climbed 45 cents, or 0.5 percent, to $86.26 a barrel. Brent crude for November settlement climbed 74 cents, or 0.7 percent, to $109.88 a barrel on the London-based ICE Futures Europe Exchange.

Oil falls more than $1 on debt concerns, dollar
LONDON, Sept 19 (Reuters) - Brent crude oil slipped below $112 a barrel on Monday as Europe stumbled over attempts to solve the euro zone debt crisis, strengthening investor fears commodity demand growth may slow.
"Financial markets want a precise and clear plan on how to deal with the European debt crisis, but they are not getting it," said Christophe Barret, global head of oil research at French bank Credit Agricole.

Gulf oil output will fall as Libya recovers-OPEC's Badri
DUBAI, Sept 19 (Reuters) - Gulf OPEC producers that raised oil output to compensate for the shutdown of Libyan oilfields will certainly reduce production as Libya's output recovers, OPEC Secretary General Abdullah al-Badri said on Monday.
Saudi Arabia and its Gulf OPEC allies raised their oil production in June after failing to convince other members to agree an increase in production to make up for the shutdown of Libyan oil fields since February.

Malaysia's Petronas to sell Star Energy to IGas Energy
KUALA LUMPUR, Sept 19 (Reuters) - Malaysia's national oil company Petronas said on Monday it will sell the oil production business of its UK subsidiary Star Energy Group Limited to IGas Energy and focus on optimising the Humbly Grove Gas Storage facility.
This is part of its strategy to focus on growing its European asset returns through marketing and trading, Petronas said in a statement.

Euro Coal-Oct S.African trades at $111.50/T
LONDON, Sept 16 (Reuters) - Prompt physical coal prices dipped on Friday with South African October values coming under the strongest downward pressure.
Chinese importers are paying up to $134.00 a tonne CIF for standard grade prompt imports, up $131.00 from the start of the week, but relatively few deals into China have been done outside of the steady flow of Indonesian low-energy coal.

Ukraine plans to raise steel output in 2011, 2012
KIEV, Sept 16 (Reuters) - Ukraine plans to produce 34.5 million tonnes of crude steel in 2011 and expects to increase the output to 37.5 million in 2012, the government said in its forecast published on Friday.
Ukraine, amongst the ten largest steelmakers in the world, raised steel production to 33.3 million tonnes in 2010 after output fell to 29.8 million in 2009 due to the global economic slowdown.

Iron Ore-Shanghai rebar at 6-week lows, weak outlook
MANILA, Sept 19 (Reuters) - China rebar steel futures fell more than 2 percent to their lowest in nearly six weeks on Monday, weighed by a hazy outlook for demand in the world's largest consumer and thinning appetite for key raw material iron ore.
September and October are normally strong consumption periods for steel in China but Beijing's credit tightening campaign has hurt demand and the boost from the government's cheap housing project is waning, traders said.

Copper Tumbles Most in 10 Months on Mounting European-Debt Woes (Source: Bloomberg)
Copper futures tumbled the most in 10 months on speculation that Europe’s escalating debt woes will hinder the global economy, eroding demand for industrial metals. European manufacturing contracted in September for the second straight month, economists said before a report on a purchasing-managers index this week. Europe’s economy is cooling as governments extend spending cuts to narrow budget deficits. In China, home prices in all 70 cities monitored rose for the first time this year, the statistics bureau said yesterday. “China property-price news over the weekend possibly sparked fears of more Beijing tightening, or no loosening, as some may have been factoring in,” said David Thurtell, an analyst at Citigroup Inc. in Singapore. “Poor euro-zone manufacturing PMI’s would obviously be a bad look” for industrial metals, he said.

Japan's copper refining capacity to fully recover by end Sept-analyst
SHANGHAI, Sept 16 (Reuters) - Japan's copper refining capacity is expected to recover to its full capacity of 1.7 million tonnes by the end of September after being hit by an earthquake and tsunami in March, a senior industry analyst said on Friday.
Ryuji Ida of the Metal Economics Research Institute of Japan said the recovery was largely due to the Mitsubishi Materials Onahama Smelting and Refining company in the northeast returning to full capacity. The firm has a smelting capacity of 324,000 tonnes per year and a refining capacity of 300,000 tonnes per year.

Japan's JX says copper demand in China solid
TOKYO, Sept 15 (Reuters) - JX Nippon Mining and Metals Corp , the parent of Japan's top copper smelter, said appetite for copper in China remains solid, helping ally concerns that a global economic downturn could dampen demand in the country and drive down the price of the industrial metal.  
Masanori Okada, president of JX Nippon Mining, said in an interview with Reuters on Thursday that the group's 2012 export offers of refined copper at premiums of about $100, the same as in 2011, are being accepted by Chinese buyers.

METALS-Copper slides on global slowdown fears
SHANGHAI, Sept 19 (Reuters) - Copper prices fell as investors focused on a possible slowdown in the global economy, with major developed nations mired in sovereign debt issues while developing economies combat inflationary pressures.
"Copper is down today as investors are feeling insecure about future global demand given the bad news out there. The euro zone crisis is unsettling while there is still no news on whether the U.S. will be rolling out a QE3," said CIFCO Futures analyst Zhou Jie.

PRECIOUS-Gold rises on euro zone woes; eyes on Fed
SINGAPORE, Sept 19 (Reuters) - Spot gold gained 0.8 percent, extending a 1.2-percent rise in the previous session, as worries about a worsening debt crisis in the euro zone and the bloc's future drove investors to seek safety in bullion.
"Gold and the dollar will remain the outperformers as equities and base metals look weak today," said a Singapore-based trader.

Gold May Rally as Italy Credit-Rating Cut Boosts Demand for Haven Assets (Source: Bloomberg)
Gold may rally from its biggest drop in a week on concern that the European debt crisis is worsening, spurring demand for haven assets including bullion. Gold for immediate delivery gained as much as 0.3 percent to $1,784.43 an ounce, and traded little changed at $1,779.67 at 7:36 a.m. in Singapore. It shed 1.8 percent yesterday as concern about a potential Greek default drove up the dollar. December- delivery bullion in New York rose 0.2 percent to $1,781.50. Standard & Poor’s Ratings Services cut Italy’s credit rating by one level late yesterday on mounting government debt and weakening growth prospects, sending the euro and U.S. stock futures lower. The Dollar Index rose for a second day yesterday as investors sought to diversify away from declining equities and commodities.

Baltic Exchange slides as cargo activity fades
LONDON, Sept 16 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, fell for a second day on Friday as cargo activity dried up and freight futures contract selling added to the market's weaker tone.  
The overall index fell 4.88 percent or 93 points to 1,814 points. Earlier this week the index had risen to its highest level in nearly nine months.

20110920 1032 Soy Oil & Palm Oil Related News.

ITS CPO export down 16.4% to 978,087 tonnes for the period of 1~20 Sep 2011.
SGS CPO export down 17.4% to 967,859 tonnes for the period of 1~20 Sep 2011.

Soybeans (Source: CME)
US soybean futures dropped to their lowest levels in five-weeks, as investors continued to trim riskier positions from the market amid global economic concerns and seasonal pressure. Declining global equity markets and a stronger US dollar left investors concerned about soybean demand holding up in the face of a sluggish world economy, analysts say. Seasonal harvest weakness added to the mounting pressure on prices, as demand for the crop remains sluggish while grain buyers wait for cheaper prices once the harvest to pick up speed. CBOT Nov soy end down 19 1/2c at $13.36/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures stumbled in unison with soybeans, succumbing to the broader based selling pressures seen across asset classes. Concerns about slowing demand and increased availability of soybeans for crushing once the harvest begins attracted sellers to pin prices in negative territory, analysts say. CBT Dec soymeal end down 1.3% at $348.50/short ton, Dec soyoil drop 1.8% to 55.84 cents/pound.

Palm oil falls as global economic uncertainty grows
KUALA LUMPUR, Sept 19 (Reuters) - Malaysian palm oil futures fell as Europe stumbled over attempts to solve the euro zone debt crisis, strengthening investor fears commodity demand growth may slow.
"Sentiment is rather weak. Exports are definitely slower in September but India's Diwali festival is coming up and there should be some support from there," said a trader with a foreign commodities brokerage, referring to the Hindu festival on Oct. 26.

Global Vegoil Prices To Fall In 4Q Amid U.S Harvest (Source: CME)
Global prices of oilseeds and vegetable oils will likely fall in the next few weeks as the current harvest in the U.S. gathers momentum but that won't change the medium-term bullish outlook, Thomas Mielke, editor-in-chief of Hamburg-based Oil World industry journal said. The prices of palm oil will fall in tandem with soybeans and soybean oil, he said. "There is the potential for some downward pressure in palm oil, but I see support at $1,000 a [metric] ton for [refined, bleached and deodorized] palm olein," free-on-board Malaysian ports, Mielke told Dow Jones Newswires on the sidelines of an industry conference. RDB olein for October shipment was offered late last week around $1,095/ton, FOB Malaysian ports, he said. "The bullish supply-side fundamentals are apparently sufficiently discounted in the prices of soybean and corn but the harvest is now expanding, so prices will come under pressure," Mielke said.
He said the weak price sentiment may continue during the fourth quarter but by early 2012, bullish factors may become dominant again. Consumption of oils and fats will exceed production in 2011-12 and stocks-to-usage ratios of both oilseeds and oilmeals will fall to multi-year lows, Mielke noted. By the end of the current marketing year on August 31, global soybean stocks will be down by 6.6% to 71 million tons, he said. Consumption of vegetable oils by the biofuels sector will rise sharply this year, particularly in soybean oil exporting countries. This could cause a decline in its global trade by 3% to 9.8 million tons. Biofuels account for only about 12% of the total global demand for oils and fats but that has an outsized impact on prices, he said.
As the availability of soybean oil shrinks, the global dependence on palm oil has accelerated in the last six months and this is expected to rise further in 2011-12, absorbing the increase in production and therefore not resulting in fresh creation of a surplus, Mielke said. Global palm oil trade may rise to 39.3 million metric from 37.9 million tons in 2010-11, he said. In the next marketing year from Oct. 1, Indonesia's palm oil exports may rise to 18.2 million tons from 17.4 million tons estimated this year, while Malaysia's shipments may rise to 17.6 million tons from 17 million tons, he added.