Tuesday, October 25, 2011

20111025 1807 FCPO EOD Daily Chart Study.

FCPO closed : 2951, changed : +61 points, volume : higher.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : rising, buyer taking exposure.
Support : 2950, 2920, 2900, 2850 level.
Resistance : 2970, 3020, 3050, 3070 level.
Comment :
FCPO closed recorded huge gains with improving volume transacted while overnight soy oil closed recorded gains and currently trading firmer while crude oil price continue to seek higher ground.
Better export data released by 2 cargo surveyor and anticipation of lower production level resulted FCPO to trade higher today.
Daily chart formed a wide range bar candle closed right at upper Bollinger band level after market opened higher and climb upwards all the way towards the end to closed near the high of the day .
Chart study revised to suggesting a side way range bound little upside biased market development testing support and resistance level with possible pullback correction.
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.

20111025 1732 FKLI EOD Daily Chart Study.

FKLI closed : 1452, changed : +0.5 point, volume : lower.
Bollinger band reading : side way range bound upside biased.
MACD Histrogram : weakening, buyer lock in profit and reduce exposure.
Support : 1445, 1440, 1425, 1420 level.
Resistance : 1458, 1470, 1485, 1500 level.
Comment :
FKLI closed 1 tick higher with quiet volume exchanged doing 5.5 points discount compare to cash market that also closed higher. Overnight U.S. markets closed firmer and today Asia markets traded mostly higher while European markets currently trading mixed.
Markets moved between between gains and losses awaits final result of European summit meeting to bailout it's region debt crisis.
FKLI daily chart formed a down doji bar candle positioned in between middle and upper Bollinger band level after market opened higher and traded range bound in both positive and negative territory before closed near opening price.
Technical reading remained suggesting a side way range bound 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 resistance or strength with quick cut loss and profit target.

20111025 1709 Regional Markets EOD Daily Chart Study.

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

20111025 1633 Global Market & Commodities Related News.

Asian shares rise, euro steadies on Europe hopes
TOKYO, Oct 25 (Reuters) - Asian shares rose and the euro steadied, keeping gains from the previous day as investors grew more confident about European leaders coming to a broad agreement to contain the region's debt crisis.
"A lot has already been priced in, so profit-taking flows will likely set initially and put downward pressure on the market after Wednesday, before the market consolidates," said Frances Cheung, senior strategist for Asia ex-Japan at Credit Agricole CIB in Hong Kong.

Asian Stocks Swing Between Gains, Losses Ahead of European Crisis Summit (Bloomberg)
Asian stocks swung between gains and losses as investors await the results of a European summit tomorrow where leaders are expected to hammer out details on enhancing the region’s bailout fund. Esprit Holdings Ltd. (330), a clothier that gets 79 percent of its revenue in Europe, lost 2.8 percent in Hong Kong. NGK Insulators Ltd. plunged 17 percent after a report the maker of industrial ceramics asked customers not to use some of its batteries following a fire. Komatsu Ltd. (6301), the world’s second- biggest construction machinery maker, rose 3.1 percent as rival Caterpillar Inc. (CAT)’s posted earnings that beat estimates. Cnooc Ltd. (883), China’s largest offshore energy explorer, rose 5.4 percent in Hong Kong after crude prices gained.
The MSCI Asia Pacific Index was little changed at 119.17 at 5:05 p.m. in Tokyo after rising and falling as much as 0.3 percent. About the same number of stocks rose as fell on the index, with six of the gauge’s 10 industry groups retreating. German Chancellor Angela Merkel and fellow European leaders will meet in Brussels tomorrow for a second summit in four days to find ways to enhance the firepower of a regional rescue fund.

European Stocks Decline Before Crisis Summit (Bloomberg)
European stocks advanced for a third day as energy companies rallied after better-than-estimated earnings from BP Plc (BP/) and BG Group Plc. (BG/) Asian shares and U.S. index futures were little changed. The Stoxx Europe 600 Index rose 0.2 percent to 242.61 at 8:55 a.m. in London. German Chancellor Angela Merkel and fellow leaders will return to Brussels tomorrow for a second summit in four days to discuss Europe’s bailout fund. Policy makers are jousting with banks over the size of losses they take on Greek bonds while deliberating over leveraging the fund after ruling out tapping the European Central Bank’s balance sheet. “We have a very difficult task for the politicians,” John Ricciardi, the head of investment at Kestrel Partners LLP in London, said in a Bloomberg Television interview with Linzie Janis. “All of us in the investing world are concerned by the continued high leverage in the European banking system.”

FOREX-Euro dips but supported ahead of EU summit
SINGAPORE, Oct 25 (Reuters) - The euro edged lower on Tuesday but held near a six-week high hit the previous day, supported by market expectations for European leaders to come up with broad measures to contain the region's debt crisis at a summit on Wednesday.
European leaders had neared a deal over the weekend on bank recapitalisation, and euro zone officials have said that France and Germany were close to agreement on how to leverage a euro zone rescue fund to stop bond market contagion.

US corn eases as US harvest gathers pace
SYDNEY, Oct 25 (Reuters) - U.S. corn futures pulled back in early Asian trading as the U.S. corn harvest gathered pace, according to government data released after trading ceased on Monday.
Traders also took profits after corn hit resistance on Monday at the $6.60 per bushel level, but soybeans futures continued to rise on strong demand from top soybeans importer China as well as encouraging Chinese manufacturing data.

Vietnam Oct coffee exports down 47.4 pct -govt
HANOI, Oct 25 (Reuters) - Coffee exports in October from Vietnam, the world's second-biggest producer after Brazil, slipped 47.4 percent from a year ago to an estimated 30,000 tonnes, or 500,000 60-kg bags, the government said on Tuesday.
The shipment estimate, mostly coming from stock of the 2010/2011 crop year that ended in September, was under traders' estimates of between 40,000 and 50,000 tonnes.

China buys new-crop Australian wheat, imports to rise
SINGAPORE, Oct 25 (Reuters) - China bought around half a million tonnes of new-crop Australian wheat in the last two weeks, more than half of what it purchased in the first nine months of this year, for its rapidly expanding livestock industry.
The country's wheat purchases come as the China National Grain and Oils Information Centre (CNGOIC) forecast corn and wheat imports to climb in 2011/12, a bullish factor for global prices.
China 2011/12 wheat, corn imports to surge-CNGOIC
BEIJING, Oct 25 (Reuters) - China is expected to import 5 million tonnes of corn in 2011/2012 (Oct/Sept) as the world's second-largest consumer has boosted imports following declines in global corn prices, said the China National Grain and Oils Information Centre (CNGOIC).
China purchased 3-4 million tonnes of corn in the first half of this year as domestic supply has been tight, the official think tank said in a report posted on its website (www.grain.gov.cn).

Brent steady; U.S. oil rises on company earnings
SINGAPORE, Oct 25 (Reuters) - Brent was steady near $111 as looming concern over Europe's economic health kept prices in check, while U.S. oil rose for a third straight day, boosted by improved company earnings.
"The real economy in Europe is not that strong," said Masaki Suematsu, a broker at Newedge in Tokyo.

Indonesian tin smelters may cut exports by 40 pct
PANGKAL PINANG, Indonesia, Oct 25 (Reuters) - Tin smelters in Indonesia, the world's top refined tin exporter, could impose a monthly quota that will slash shipments by about 40 percent, the Indonesian Tin Industry Association said on Tuesday, in a move to further boost prices.
Smelters in the main Indonesian tin-producing region of Bangka island, put in place a tin ingot export stoppage on October 1, in an effort to push benchmark prices above $25,000 a tonne.

Iron ore giants gamble on long-term Asian demand
SYDNEY, Oct 25 (Reuters) - Iron ore prices are in tailspin -- down 20 percent in the last month and clocking seven straight weeks of losses -- and the world's biggest producers couldn't seem to care less. Last year's contentious shift away from once-a-year pricing of ore in favour of shorter term contracts is now delivering lower returns on sales of more ore, yet miners appear unworried about the market's gloomy performance, moving full steam ahead on massive expansion projects.

China Sept refined copper imports at 16-month high
HONG KONG, Oct 24 (Reuters) - China's imports of refined copper rose 17 percent on the month in September to hit a 16-month high on improved margins and increased stocking ahead of a peak demand season.
Arrivals of refined copper to the world's top consumer rose to 275,499 tonnes in September, the highest level since May 2010 and a gain of 13.9 percent from September 2010, data from the General Administration of Customs showed on Monday.

Cautious on copper, China waits for prices to halve
SINGAPORE, Oct 21 (Reuters) - Copper will not recover any lustre soon after losing a quarter of its value since July, as China, the metal's top user and last hope in the face of crumbling Western demand, waits for prices to halve before it begins to rebuild stocks.
Supply worries stemming from a lengthy strike at the world's second-largest copper mine in Indonesia are being offset by bulging stocks and signs of slowdown in China, which saw its lowest growth in two years in the third quarter amid weakness in its two biggest markets, Europe and the United States.

Shanghai copper climbs on Europe hopes
SHANGHAI, Oct 25 (Reuters) - Shanghai copper hit its daily upper trade limit, climbing for a third straight session on growing optimism that  European leaders would agree on a strategy to solve the region's debt woes at a meeting this week.
"Optimism over the euro zone crisis helped lift sentiment, along with the good performance of Asian equities today and the belief that copper prices have fallen so much that it is time for them to rebound again," Jinrui Futures analyst Zhao Kai.

Cheaper silver dominates festival sales in India
MUMBAI, Oct 24 (Reuters) - Small-sized silver bars and coins dominated festival sales in India, the world's top consumer, as precious metals consumers hit by inflation chose the cheaper white metal in hopes of future price gains.
On Monday, India celebrates Dhanteras, the first day of the five-day Diwali festival, considered auspicious for buying of precious metals.

METALS-Shanghai copper climbs on Europe hopes
SHANGHAI, Oct 25 (Reuters) - Shanghai copper hit its daily upper trade limit on Tuesday, climbing for a third straight session on growing optimism that  European leaders would agree on a strategy to solve the region's debt woes at a meeting this week.
The most-active January copper contract on the Shanghai Futures Exchange  briefly halted trading after rising 7 percent to 57,240 yuan ($8,978.26) against the previous day's settlement price, hitting its limit up for the second day in a row.

PRECIOUS-Gold steady before EU summit; physicals resilient
SINGAPORE, Oct 25 (Reuters) - Gold prices held steady on Tuesday, as investors wait for European leaders to work out a strategy to solve the euro zone debt crisis at a meeting on Wednesday, while resilient physical demand from Asia also lent support.
Investors grew confident after a weekend European Union summit made some progress towards an agreement on how to contain the debt crisis, even though the final decision was deferred to a second summit on Wednesday.

20111025 1236 Global Market & Commodities Related News.

GLOBAL MARKETS-Stocks, commodities up on Europe, Caterpillar
NEW YORK, Oct 24 (Reuters) - Global stocks hit a seven-week high on Monday and commodities rallied on optimism European leaders were moving closer to resolving the region's debt crisis as strong earnings from Caterpillar boosted investor sentiment.
"Investors are pricing in the fact that the worst will be avoided with the conclusion of Wednesday's EU summit," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey.

Asian Stocks Swing Between Gains, Losses Ahead of European Crisis Summit
Asian stocks swung between gains and losses as investors awaited the results of a European summit tomorrow where leaders are expected to hammer out details on enhancing the region’s bailout fund. Esprit Holdings Ltd. (330), a clothier that gets 79 percent of its revenue in Europe, lost 2.8 percent in Hong Kong. NGK Insulators Ltd. plunged 23 percent after a report the maker of industrial ceramics asked customers not to use some of its batteries after a fire. Komatsu Ltd. (6301), the world’s second-biggest construction machinery maker, rose 3.5 percent after rival Caterpillar Inc. (CAT)’s posted earnings that beat estimates. Cnooc Ltd. (883), China’s largest offshore energy explorer, rose 4.4 percent in Hong Kong after crude prices gained.
The MSCI Asia Pacific Index rose 0.1 percent to 119.24 as of 12:33 p.m. in Tokyo after falling as much as 0.2 percent. About the same number of stocks rose as fell on the index, with six of the 10 groups advancing. German Chancellor Angela Merkel and fellow European leaders will meet in Brussels tomorrow for a second summit in four days to find ways to enhance the firepower of a regional rescue fund.

China’s Stocks Rise, Extending Biggest 2-Week Gain; Vanke Jumps on Profit (Bloomberg)
China’s stocks rose, extending the biggest gain in almost two weeks, as a jump in profit for China Vanke Co., the nation’s biggest developer, eased concerns the slowing economy will spur an earnings collapse. Beijing BDStar Navigation Co. led gains among satellite navigation system producers after Xinhua News Agency reported about 1 million trucks will be required to install the systems. Vanke rose 1 percent after third-quarter profit surged 32 percent. Jiangxi Copper Co. had its biggest two-day gain in eight months on higher commodity prices. Pang Da Automobile Trade Co. fell 1.9 percent after Swedish Automobile NV rejected the company’s bid to acquire Saab Automobile. The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, gained 16.45 points, or 0.7 percent, to 2,386.79 at the 11:30 a.m. local-time break. The CSI 300 Index (SHSZ300) rose 0.9 percent to 2,600.27.

COMMODITIES-Copper, oil surge as Europe, China drive rally
NEW YORK, Oct 24 (Reuters) - Copper recorded its biggest jump in nearly three years on Monday and U.S. oil rose above $90 for the first time since August after European leaders achieved some progress in talks to fix the region's finances.
"It looks to me like commodities in general have made a bottom, and are going to go higher ... the worst is in the past," said Michael K. Smith, president of T & K Futures and Options Inc in Port St. Lucie, Florida.

US crude surges, outpacing Brent in spread trade
NEW YORK, Oct 24 (Reuters) - U.S. crude surged to its highest level in more than two months on Monday, outpacing gains in Brent, as volatile trade in key spreads stole the limelight from upbeat Chinese data and optimism over the euro zone.
"I think you have a pretty good short position starting to unwind in WTI," said Richard Ilczyszyn, senior market strategist of MF Global in Chicago, adding satellite images had shown a 2 percent drawdown in inventories at the Cushing, Oklahoma, delivery point for the New York Mercantile Exchange's futures contract.

12-month natural gas strip hits nine-year low
NEW YORK, Oct 24 (Reuters) - The average of the first 12 months of New York Mercantile Exchange natural gas futures contracts slid to its lowest in nine years on Monday as growing supplies and moderate weather weighed on the complex.
The 12-month futures strip  fell 2.3 cents to settle at $3.923 per million British thermal units, the lowest strip settle since Nov. 15, 2002, when the average closed at $3.926, Reuters data showed.

Euro Coal-Prices stable in low liquidity
LONDON, Oct 24 (Reuters) - Prompt physical coal prices remained stable on Monday, little changed from the end of last week, with strong Asian demand providing price support, while weak sentiment in Europe acted as a brake on price rises.
"There is still some length in the system, but no confidence in significant price rises, so I'd say it's only a matter of time before the length is sold off and shorts try to benefit from this situation on the financial market," one coal trader said.

20111025 1002 Local & Global Economic Related News.

Malaysia's debt rises to RM407bil
PETALING JAYA: Malaysia's public debt level rose 12.3% to RM407.11bil in 2010 from RM362.39bil a year earlier, according to the Auditor-General's Report 2010. National debt grew 12% to RM390.36bil in 2010 from RM348.60bil a year earlier while foreign debt grew 21.5% to RM16.75bil from RM13.79bil in the previous corresponding period, said the report released yesterday. In 2010, unresolved public debt both at the national and foreign level grew by RM41.76bil and RM2.96bil respectively compared with 2009. “The national debt level totalling RM390.36bil accounts for 95.9% of the Federal Government's total debt,” auditor-general Tan Sri Ambrin Buang said in the report. He pointed out that the ratio of the Federal Government's debt to gross domestic product at the end of 2010 was 53.1%, which was over 50% for the second year in a row.
The national debt level is governed by various laws that impose a debt ceiling for the Government. Under Act 637 of the Loan (Local) Act 1959, and Act 275 of the Government Investment Act 1983, it is stated that the combined loans raised domestically should not exceed a ceiling of 55% of the nation's GDP. Meanwhile, Act 403 of the External Loans Act 1963 limits external loan exposure to RM35bil. The report also revealed that in 2010, the Government received revenue totalling RM159.65bil, which was an increase of RM1.01bil (0.6%) compared with RM158.64bil in 2009. Accounts receivable for 2010 stood at RM20.37bil while the Government approved allocation amounting to RM149.06bil for operating expenditure. “However, the said allocation was insufficient to cover the expenses amounting to RM151.63bil,” said the report. The report also revealed the implementation of a rating system based on an accountability index.
“Through this rating system, marks will be given for the compliance if regulations of six main elements in financial management, namely management controls, budgetary controls, receipt controls, expenditure controls, management of trust funds and deposits as well as management of assets and stores. “The federal ministries and departments rated as excellent become a role model and this would motivate others to diligently improve and enhance their financial management,” it said. (The Star)

Singapore: September inflation slows
Singapore inflation came in at 5.5% y-o-y in September, the Department of Statistics said, below the median forecast of 5.7% by Reuters. The central bank’s core inflation measure rose 2.1% y-o-y after rising 2.2% in August. On a m-o-m basis, core inflation was unchanged in September after gaining 0.4%. (StarBiz)

China: Manufacturing gauge rises as Japanese exports advance
China’s manufacturing may expand in October for the first time in four months, snapping the longest contraction since 2009, after a preliminary index of purchasing managers showed a rebound in new orders and output. The reading of 51.1 for the index was the highest in five months compares with the final reading of 49.9 for September and August. The Chinese report, along with Japanese data showing an increase in exports exceeding economists’ forecasts, signaled that Asia’s largest two economies are withstanding Europe’s sovereign debt crisis. (Bloomberg)

Japan: Exports increase more than expected, withstanding global slump signs
Japan’s exports rose more than expected last month, a sign shipments withstood weakening global growth before the yen climbed to a postwar high that prompted officials to pledge “decisive” steps today to stem its gains. Shipments increased 2.4% in September from a year earlier as demand for cars and auto parts rose, the Ministry of Finance said in Tokyo today. The median estimate of 26 economists surveyed by Bloomberg was for a 1% increase after a 2.8% gain in August. The nation posted a trade surplus of JPY300bn (USD3.9bn). (Bloomberg)

EU: Manufacturing, services shrink most since 2009
European services and manufacturing output contracted in October at the fastest pace in more than two years, adding to signs the region’s economy is edging toward a recession. A euro-area composite index based on a survey of purchasing managers in both industries fell to 47.2 from 49.1 in September. That’s the lowest since July 2009. The European Central Bank earlier this month resisted calls to lower interest rates, instead extending its use of unconventional tools, even as the economy is showing signs of a deepening slowdown. German investor confidence dropped to the lowest in almost three years this month. (Bloomberg)

The  federal government had to use its cash pile to make up for the  RM5.95bn shortfall in its 2010 expenditure and outlay, according to the 2010  Auditor-General’s Report released yesterday. For 2010, the federal  government’s source of funds was RM519.99bn from tax and non-tax revenues  (+0.6% to RM159.65bn from RM158.64bn in 2009), loans, receipts from capital,  trust or deposits and public finance initiatives (PFI). However, RM525.93bn was incurred to fund operating expenditure  (RM151.63bn vs, approved RM149.06bn in 2010), development  (RM52.79bn vs. approved RM52.13bn), PFI expenditure, capital  payments, payback on loans, trusts or deposits, resulting in a shortfall  of RM5.95bn. The shortfall was made up by using cash, leaving the government with  only RM21.57bn cash as at 31 Dec 2010, it said.  Overall, nine ministries or departments have spent RM3.73bn more  than the allocated amount, while additional allocations were passed by  the Parliament on 3 Jun 11 to make up for the inadequacy.  The AG’s report also uncovered weaknesses in spending under the  five-year Ninth Malaysia Plna, when the Education and Defence  ministries and the Treasury had overspent by RM2.57bn from the total  original spending of RM44.47bn. The audit also found that 93 projects  carried out by 20 ministries exceeded the estimates by RM6.16bn while  another 19 projects by 11 ministries and departments exceeded  estimates by RM1.07bn. (Financial Daily)

Government agencies have shown better  financial management  performance for the year 2010 compared to the previous year. In a statement  during the presentation of the 2010 Auditor General's Report in the Dewan  Rakyat yesterday, the National Audit Department said 357 government agencies  were audited last year and 77 of them attained the four-star "very good" rating  compared to only 48 out 399 given the same ranking in 2009.  "The significant improvement signifies that the implementation of the  Accountability Index (AI) proved to be an incentive to heads of  departments and agencies to pay more attention to financial  management," the department said. (Bernama)

The federal government has approved an allocation of RM194.7m for the  rubber replanting programme and new rubber cultivation nationwide for the 2011-12 period. Plantation Industries and Commodities Minister Tan Sri  Bernard Dompok said from this amount, the Sabah Rubber Industry Board  (SRIB) was allocated RM29m for rubber replanting on 2,000 hectares of land  and new cultivation involving 5,000 hectares. He said RM112.7m was set aside  for Risda for rubber replanting involving 24,000 hectares in the peninsula,  4,000 hectares in Sabah with the SRIB, and 10,000 hectares in Sarawak.  (Bernama)

A US government mortgage relief program will expand to allow  homeowners to refinance regardless of how much their houses have dropped in  value, the regulator overseeing Fannie Mae and Freddie Mac announced. The  Federal Housing Finance Agency also said it will eliminate certain fees and  relieve banks of certain risks as part of the changes announced to the Home  Affordable Refinance Program, or HARP. (Bloomberg)

US companies’ hiring plans reflect the worst employment outlook since Jan  10 as demand slows in the world’s largest economy, a private survey showed.  Fewer companies project payrolls to rise in the next six months compared with a  Jul survey, while more plan to cut workers, the  National Association for  Business Economics said. The share of firms planning to raise prices was the  smallest in almost two years. (Bloomberg)

The Flash Markit Eurozone Services Purchasing Managers' Index (PMI)  sank to 47.2 in Oct (48.8 in Sep). Economists forecast a reading of 48.5.  (Reuters)

The euro zone's manufacturing PMI slipped to 47.3 in Oct from 48.5 in Sep,  its lowest point since Jul 09. Economists expected a reading of 48.2. (Reuters,  Bloomberg)

The eurozone composite PMI, a broader measure of private sector activity,  also fell sharply, from 49.1 in Sep to 47.2 in Oct. (Reuters)

Eurozone orders rose 1.9% mom in Aug (-1.6% in Jul), the Eurostat said.  Economists had forecast order growth to stall. On a yoy basis, orders jumped  6.2%. (Bloomberg)

Japan’s merchandise exports increased 2.4% yoy in Sep (+2.8% in Aug) as  demand for cars and auto parts rose, the Ministry of Finance said. Economists  forecast a 1% increase. The nation posted a trade surplus of ¥300bn (US$3.9bn).  (Bloomberg)

Overseas investors are boosting holdings of Japanese short-term debt at  a record pace  as Europe’s fiscal crisis and signs of a slowdown in the US  economy boost demand for the Asian nation’s assets as a haven. Money  managers bought ¥14.8tr (US$194bn) more in money-market instruments than  they sold in 2011 through Sep, set for the biggest-ever annual net purchases in  data going back to 2005, according to Japan’s Ministry of Finance. (Bloomberg)

Thailand’s floods will affect the government's finances, increasing expenditure  and depressing revenue, but are not expected to affect the Kingdom's creditworthiness, said Moody's Investors Service. (The Nation)

Thailand’s  economic growth next year could reach 5-6% if manufacturing  can make a full recovery in the next three to six months while the government  accelerates rehabilitation of infrastructure and facilities for logistics. The  National Economic and Social Development Board (NESDB) bases its highly  optimistic view on the assumption that the government can speed up draining water from badly flooded industrial estates while also rebuilding roads and  other facilities. (The Nation)

HSBC's flash purchasing managers' index (PMI) for China rose to 51.1 in  Oct from Sep's final reading of 49.9 as new orders and new export orders  expanded. (Reuters)

China’s current account surplus will fall to about 4% of GDP this year from  a record high of about 10% in 2007 and 2008, central bank Governor Zhou  Xiaochuan said. (Reuters)

Two more industrial estates in the Bangkok metropolitan area with a combined  344 factories were at risk of being inundated by the flooding in Thailand. The  Labour Ministry estimates more than 650,000 employees are temporarily out of  work. (Reuters)

Thai Deputy Prime Minister and Commerce Minister Kittirat Na-Ranong said  industrial zones operators were expecting to reopen within 45 days of the water  receding, but he was unable to give a timeframe for when that would happen.  He said the government would need to create an  industry relief fund of  about THB100bn (US$3.2bn), and international financial institutions and a  Japanese organisation had offered to contribute. (Reuters)

The  United Nations is closely monitoring the potential  for “serious  food  shortages” in parts of Southeast  Asia after flooding devastated rice paddies.  7m tonnes of paddy may be lost from Thailand's main 2011/12 rice crop, which  means total production could drop to 18m tonnes. Harvesting began in early  October. 12.5% of rice farmland in Thailand has been damaged, along with 6%  in the Philippines, 12% in  Cambodia, 7.5% in  Laos and 0.4% in  Vietnam.  (Bloomberg, Reuters)

The change in Indonesia’s consumer prices in Oct may +/-0.1% mom, Bank  Indonesia Governor Darmin Nasution told reporters. (Bloomberg)

The  Philippines’ budget deficit 9M11 was “way below program” Finance  Secretary Cesar Purisima said today in Manila, without providing details. The  government reported a budget deficit of PP34.5bn in 8M11 or about 15% of the  level a year earlier. (Bloomberg)

20111025 1001 Malaysia Corporate Related News.

Plantation: Felda said to have hired banks for IPO. Felda Global Group has hired bankers for an initial public offering (IPO) that would raise as much as USD2b (RM6.3b) next year. A source with direct knowledge of the matter said that Felda has hired CIMB Investment Bank, Maybank Investment Bank and Morgan Stanley to be joint global co-ordinators, while JPMorgan and Deutsche Bank are joint bookrunners. (Source: Business Times)

Plantation: Indonesia CPO discount to Malaysia emerging on thin capacity. Crude palm oil, free on board (FOB) Indonesia, is moving into a discount to the Malaysian grade on market talk of higher production as well as a lack of refining capacity on the archipelago. The Indonesian grade was offered at USD917.5 per tonne on Monday, a 1.4% discount to Malaysia. This could widen as traders in Jakarta say they cannot cope with more orders of processed palm oil, as refining capacity is at the maximum. (Source: The Edge Financial Daily)            

Hibiscus in oilfield deal
Hibiscus Petroleum, which has requested for a suspension of its stock pending an announcement, is to buy a stake in an oilfield concession priced between USD50m (RM150m) and USD70m (RM210m), said a source. The company, which is the first listed Special Purpose Acquisition Company (SPAC) in Malaysia, is expected to make an announcement today. Located outside of Malaysia, this oilfield is said to come with a concessionary lifespan of some 20 years and would be providing recurring income to the company starting from its financial year ending 31 March, 2013. (StarBiz)

Genting game to fly punters to Miami
The Genting Group is dead serious about the potential of its casino report plan in sunny Miami, so much so that it is willing to buy 50% of seats to make direct flights happen from Asia to Miami. If Miami can’t attract non-stop flights from Asia, Genting is “prepared to bankroll and subsidize some of the flights,” Colin Au, president of Genting Americas said. (Financial Daily)

Court nod for HL Islamic Bank to take over EONCap Islamic Bank
Hong Leong Islamic Bank has been given court approval for it to take over the entire business of EONCap Islamic Bank with effect from 1 Nov 2011. HL Islamic Bank said the High Court had granted the vesting order for the transfer of the entire business including all assets and liabilities of EONCap Islamic Bank. Following the vesting, EONCap Islamic Bank will become a dormant company. (Financial Daily)

Maybank ties up with India’s Axis Bank for remittance services
Malayan Banking expects 15% growth in remittances for its Maybank Money Express (MME) service following its tie-up with Axis bank of India to introduce remittance services to beneficiary accounts in India. Maybank said this service offered competitive service charge to its customers and it also reduced the time taken for remittances from Malaysia to India compared to conventional remittance method (Swift) which took about two days to reach the beneficiary. (Financial Daily)

KL Eco City to get off the ground early 2012
After more than a decade of delay, property developer SP Setia expects to start working on the RM6bn KL Eco City, opposite Mid Valley Megamall in Kuala Lumpur, by early next year. In its filing to the stock exchange yesterday, SP Setia said Kuala Lumpur City Hall or Dewan Bandaraya Kuala Lumpur (DBKL) had finally formalized the privatization of the 10ha cluster of land parcels in the Kampung Haji Abdullah Hukum area. The land is being alienated to KL Eco City SB (KLEC), which is owned by SP Setia and Yayasan Gerakbakti Kebangsaan on a 60:40 basis. (BT)

Engtex snags cheap land in Puncak Alam.
Engtex’s 70%-unit Tiara Best SB acquired two parcels of agriculture land in a public auction, measuring 182 acres in Puncak Alam for RM31m, or RM3.90 psf. The group is planning to convert the agricultural land into industrial land and develop it into an integrated industrial park with a GDV of RM166m. (Financial Daily)

Petronas records the highest pre-tax profit
PETALING JAYA: More than half of the 47 Federal Government companies were profitable in 2009 with pre-tax profit totalling RM93.06bil. According to the Auditor-General's Report, about 59.6% or 28 companies had been profitable. Of the companies, 14 had been profitable for three consecutive years up till 2009. Among the top three companies with the highest pre-tax profit were Petronas at RM89.4bil, Bank Pembangunan Malaysia Bhd at RM339.5mil and Cyberview Sdn Bhd at RM79.3bil. The total pre-tax profit for the 28 companies totalled RM89.9bil in 2009, down from RM97.1bil in 2008. (The Star)

Supermax third-quarter earnings decline on price volatility
PETALING JAYA: Supermax Corp Bhd's net profit for the third quarter ended Sept 30, 2011 fell 18.9% to RM30.91mil from RM38.12mil in the previous corresponding period due to continuously high volatility in both natural rubber and nitrile latex prices. “Compared with a year ago, the price of natural rubber latex has risen by 23.4% while nitrile latex prices have increased even more sharply by 41.6%,” it said in a note to Bursa Malaysia yesterday. The company said although profitability was lower than last year, it is seeing positive signs for a rebound after recording a second consecutive quarter of core profit growth. “This can be attributed to a sustained retracement in natural rubber latex prices from a high of RM10.87 per kg wet in April 2011 to RM7.91 as at Oct 21, 2011. Supermax's revenue for the third quarter ended Sept 30, 2011, however, rose to RM271.42mil from RM235.10mil a year earlier. (The Star)

DiGi.Com net profit marginally higher
PETALING JAYA: DiGi.Com Bhd saw its net profit rising by a marginal 1.08% to RM292.45mil for the third quarter ended Sept 30 compared with RM289.31mil for the corresponding period last year. This was due mainly to accelerated depreciation charges of RM306.8mil during 3Q2011, compared with RM196.69mil in 3Q2010. DiGi.Com's average revenue per user for the quarter in review also fell to RM50 compared with RM53 last year. (The Star)

PT Bank CIMB Niaga net profit higher
PETALING JAYA: PT Bank CIMB Niaga Tbk reported an unaudited consolidated net profit of 2.38 trillion rupiah (RM844.65mil) as at September 2011, up 33% from 1.79 trillion rupiah in the same period last year. This translated to earnings per share (EPS) of 95.10 rupiah, higher than the 74.98 rupiah recorded for the same period last year. CIMB Niaga's higher profit was largely driven by an increase in total operating income of 1.15 trillion rupiah to 7.65 trillion rupiah in September 2011, compared to 6.50 trillion rupiah for the corresponding period last year.

YTL Comm plans more base stations
KUALA LUMPUR: YTL Communications Sdn Bhd (YTL Comms) will be setting up additional 1,500 base stations in the country bringing its total to 4,000 by end-2012 to expand coverage for its 4G mobile Internet-with-voice service, Yes. “We started with 1,200 base stations when we introduced our service last November. Today, we have some 2,000 base stations covering the whole Peninsular Malaysia. We're almost a year now and we're doubling the sites in 12 months,” chief executive officer Wing K. Lee said at a joint briefing by YTL Comms and research firm IDC. He said by year-end it should have 2,500 base stations running and that Yes' coverage encompasses the entire North-South Expressway, the west coast, Kelantan, Terengganu and Pahang.
The company, however, did not reveal the investment for the additional base stations. It was reported that the company had invested some RM2.5bil in the Yes 4G infrastructure. In an interview with StarBiz earlier, Lee said YTL Comms had allocated RM3.3bil for the deployment of its base stations and had so far spent more than US$200mil. YTL Comms intends to step up its coverage to 85% of the population from 65% currently. Yes currently has some 300,000 subscribers. YTL Comms also intends to extend its services to Sabah and Sarawak and is currently awaiting for green lights from the Government. (The Star)

Genting Malaysia is acquiring two IT support services entities, E-Genting and  Ascend International from sister company  Genting Singapore for RM48m  and RM2m respectively. The related party transaction will enable Genting  Malaysia to reap cost savings.  Genting Singapore acquired E-Genting in 2005  for RM87.4m and Ascend for HK$2 in 2007. The services provided by the acquiree group are mainly to the Genting  Malaysia group of companies, comprising IT, implementation, support  and maintenance services as well as Malaysian WorldCard loyalty  programme management services. (Financial Daily)

Bursa Malaysia has granted RHB Capital a further extension of time of six  months to complete the implementation of its rights issue to raise gross  proceeds of approximately RM1.3bn for the proposed acquisition of a  substantial stake in PT Bank Mestika Dharma. (Star Biz)

The Energy Commission (EC) is appointing consultants to advise the  commission on future power plant bids, which includes possible replacement  plants for the existing first generation  independent power producers  (IPP). According to Energy, Green Technology and Water Minister Datuk Seri  Peter Chin, 4,500MW more of gas-based power generation would be  required by 2017 to replace retired capacities and meet new demand.  The first unit of 750MW in peninsular Malaysia is expected to be open  for competitive bidding by the 1Q12. Sources say it is likely to be a  gas-fired power plant with a 21 year concession.  The current problems faced by Tenaga Nasional Bhd regarding the  shortage of gas may be a boost for the first generation gas-fired IPPs as  they negotiate extensions of their power purchasing agreements.  Sources say that while some regard the gas shortage as temporary,  others think that it could signal that Petronas is rationing the supply of  gas. Also, adding power from coal-fired power plants costs 30 sen per  kilowatt hour (KwH) compared with that from gas-fired power plants at  less than 20 sen KwH. Until the new coal-fired power plants come up by  2015-2016 Tenaga may look towards extending the  gas-fired IPPs or  convince Petronas for more availability of gas. (Star Biz)

Toyota Motor said it would trim production at its Japanese vehicle assembly  factories this week, from yesterday to Friday, due to a shortage of Thai-made  parts as floods in the country disrupted supply. The world’s biggest automaker  would cancel overtime at its four directly owned vehicle plants in Japan this  week, while other subsidiaries and affiliates would also reduce vehicle assembly.  Toyota estimated an output loss of about 6,000 vehicles in Japan for  this week. It has also suspended production in Thailand at least through  Friday, estimating lost output as of last week at 37,500 vehicles at its  Southeast Asian export hub. (Reuters)

The owner and operator of the Port Klang Cruise Centre (PKCC) in Pulau Indah  has come up with a proposal to convert the country's first cruise terminal into  Port Klang's third container port.  Port Klang Authority chairman Datuk  Teh Kim Poo told BT that owner-operator Glenn Defense Marine (Asia)  Sdn  Bhd (GDMA) had submitted its proposal to the port authority.GDMA bought  over PKCC from Star Cruises Terminal Sdn Bhd for RM118m in 2009. GDMA is  part of the Glenn Marine Group of Companies which is partly owned by  Lembaga Tabung Angkatan Tentera (LTAT). When asked why the location was not considered in its 20-year master  plan, Teh said the idea of converting the cruise terminal into a container  port had not come about then. The Port Klang Development Master  Plan 2010-2030 commissioned late last year in effect had identified five  locations, which did not include the PKCC site. These were Pulau Che  Mat Zin, Klang Bar Channel, Old Klang Bar Channel, Pulau Carey and  Kampung Batu Laut. Industry players have questioned the need for a third port considering  there is room for expansion in Northport and Westports.Teh, however,  begged to differ, saying land for expansion at the two ports were  limited."Westports has land for further development but this is land  owned by Tan Sri G. Gnanalingam in his personal capacity, we cannot  consider that in our plans," Teh said.(BT)

The 75.5 acre KL Metropolis development by Naza TTDI, which will house  the new headquarters of Matrade has a total GDV of RM15bn. It will be  completed by 2025 over three phases. The first phase involves an estimated  GDV of RM6bn and will see the construction of the new Matrade HQ, an  exhibition centre, a retail space offering more than 2m sq ft, a residential tower,  two hotels and two office buildings. Naza TTDI will open a tender for the building of the RM628m Matrade  HQ within two months. Phases 2 and 3 may include a five-star healthcare development and education establishments potentially  involving business schools. (Financial Daily)

Malaysia is on the right path towards a digital economy by 2020 amid strong  demand for new technology, says Nielsen, a leading global information and  analytics provider. There is strong interest for new technology as Malaysians are  ready for the changes as shown in the Malaysian Digital Consumer Report  2011, said Luca Griseri, Nielsen Malaysia director of customised research, client  services.  Malaysia's digital transformation programme is going to change  consumers' behaviour, he told a press conference. Griseri said the  report revealed that the take-up rate for smartphones and tablet  computers is gaining significant momentum in Malaysia, and therefore  the industry must ensure easy access for these devices. "Smartphone  ownership is expected to double in the next 12 months to reach 89%  from 48% currently, while tablet computers is likely to reach 75% from  18% presently," he said (Bernama).

20111025 0955 Global Market Related News.

Most Asian Stocks Fall as Investors Wait for European Decision (Source: Bloomberg)
Most Asian stocks fell, erasing earlier gains, as investors waited to see how European policymakers will hammer out details to enhance the region’s bailout fund. Toyota Motor Corp. (7203), the world’s biggest carmaker, fell 1.3 percent. Komatsu Ltd. (6301), Japan’s largest construction machinery maker, rose 2.6 percent after Caterpillar Inc.’s earnings beat estimates. National Australia Bank Ltd. (NAB), Australia’s fourth- biggest lender by market value, lost 1.1 percent. The MSCI Asia Pacific Index fell 0.1 percent to 119.00 as of 9:55 a.m. in Tokyo after rising as much as 0.3 percent. About three stocks fell for each that rose on the index.
“Clearly, the dominant factor is what’s happening in Europe,” said Angus Gluskie, who manages more than $350 million at White Funds Management in Sydney. “At this stage, I think there are some superficial optimism that some sort of deal might be reached. Underneath the surface, though, I think investors still have a lot of questions in the back of their minds and they are alert to risks. Most investors want to get their minds around details tomorrow.”

U.S. Stocks Rise Amid Takeovers as Caterpillar Beats Estimates (Source: Bloomberg)
U.S. stocks rallied, almost wiping out this year’s decline in the Standard & Poor’s 500 Index, amid takeover deals, higher-than-estimated earnings at Caterpillar Inc. (CAT) and progress in talks to tame Europe’s debt crisis. Gauges of commodity, financial and technology shares had the biggest gains in the S&P 500 among 10 groups, rising at least 1.9 percent. Caterpillar, the largest construction and mining-equipment maker, climbed 5 percent. RightNow Technologies Inc. (RNOW) surged 19 percent, while Healthspring Inc. (HS) soared 34 percent, on acquisitions. Alcoa Inc. (AA) added 3.4 percent as metals advanced on signs of growth in China and Japan. The S&P 500 increased 1.3 percent to 1,254.19 as of 4 p.m. New York time, paring its 2011 retreat to 0.3 percent. The Dow Jones Industrial Average climbed 104.83 points, or 0.9 percent, to 11,913.62 today. The Nasdaq Composite Index gained 2.4 percent, erasing its year-to-date decline. The Russell 2000 Index of small companies advanced 3.3 percent.

Fed Wants to Ensure Housing Affordability, Dudley Says (Source: Bloomberg)
Federal Reserve Bank of New York President William C. Dudley said the central bank wants to keep mortgage interest rates from rising too much and may do more to hold down borrowing costs. The Fed’s decision last month to reinvest proceeds from maturing housing debt into mortgage-backed securities was a “signal that we do have concern about the level of mortgage spreads,” Dudley said today. “Clearly we’ve indicated our interest in supporting the housing market” and keeping yields from “getting too elevated.” Policy makers approved the action as part of an effort to spur the economy with lower borrowing costs by replacing $400 billion of short-term Treasuries in the Fed’s portfolio with longer-term bonds. The decision prompted dissents from three regional Fed presidents: Richard Fisher of Dallas, Charles Plosser of Philadelphia and Narayana Kocherlakota of Minneapolis.

Fed’s Sack Says Reinvestment in Mortgage Bonds Is Proceeding ‘Smoothly’ (Source: Bloomberg)
Brian Sack, the Federal Reserve Bank of New York’s markets group chief, said the central bank’s program of reinvesting proceeds from maturing housing debt into mortgage-backed securities isn’t disrupting markets. “The purchases have gone smoothly and market liquidity seems to be quite good,” Sack said today in the text of remarks given at the New York Fed’s annual meeting with primary dealers. The policy-setting Federal Open Market Committee last month said it would swap $400 billion of short-term debt in its portfolio for longer-term securities in order to bring down interest rates, a strategy dubbed Operation Twist. The central bank also said it will switch to reinvesting housing debt proceeds to mortgage bonds from Treasuries. This reinvestment change “came as a surprise to the markets, in part because the FOMC had communicated that it seeks to return to a Treasury-only portfolio over time,” Sack said.

BlackRock Sees Slowdown of China GDP Growth (Source: Bloomberg)
A near doubling in the Chinese economy’s reliance on credit over the past decade will prompt slower growth in coming years, risking diminished returns for investors, according to research by BlackRock Inc. China’s gross domestic product will rise at a 7 percent to 8 percent pace in the next few years, said analysts at the BlackRock Investment Institute, a London-based unit of the world’s biggest money manager, down from 10.5 percent in the past decade. One yuan of GDP now needs about 0.30 yuan of credit, compared with 0.17 yuan in 2002, a shift BlackRock describes as like a car getting less mileage per gallon of gas.
Premier Wen Jiabao’s decision to loosen some lending curbs this month amid weakening prospects for U.S. and European demand for exports underscores the reliance of the world’s second- largest economy on credit. The country’s banking regulator said yesterday it will allow a higher bad-loan ratio for small companies that have been hardest hit by a slowdown in borrowing engineered to rein in inflation.

Caterpillar Earnings Top Estimates as Economy Recovers (Source: Bloomberg)
Caterpillar Inc. (CAT), the world’s largest construction and mining-equipment maker, posted higher- than-expected third-quarter profit and sales and said 2012 revenue will gain as the U.S. and global economies improve. Net income climbed 44 percent to $1.14 billion, or $1.71 a share, from $792 million, or $1.22, a year earlier, the Peoria, Illinois-based company said in a statement today. The average of 15 analysts’ estimates compiled by Bloomberg was for $1.57. Sales increased 41 percent to $15.7 billion, beating the $14.9 billion average of analysts’ estimates. The shares advanced as much as 6.3 percent. While the European debt crisis and the level of U.S. growth are concerns, they don’t “signal the onset of recession,” Caterpillar said. The world economy will grow at 3 percent in 2011 and 3.5 percent in 2012, with the U.S. and Japanese post- earthquake reconstruction accounting for much of the improvement, it said.

Inflation Peaking in U.S. With Prices Tumbling in Bear Market: Commodities (Source: Bloomberg)
The biggest rout in commodities since the global recession may be a sign that the fastest U.S. inflation in three years is peaking. The Standard & Poor’s GSCI Index of 24 commodities entered a bear market last month after sliding more than 20 percent from a two-year high in April, on concern that slower growth will cut demand. A slump in the gauge from a 2008 record preceded a drop in inflation, while a 2009 rebound caused the consumer price index to climb. Raw materials fell 12 percent in September as the CPI rose 3.9 percent from the same month a year earlier, the most since 2008. “There is a sense that headline inflation is receding,” said Stephen Stanley, the chief economist at Pierpont Securities LLC, a government-bond broker in Stamford, Connecticut. “Things have been a little more tame the last few months than they were earlier in the year, when you had this relentless push higher, in energy prices especially.”

Treasury 10-Year Bonds Halt 3-Day Decline Before European Leaders Summit (Source: Bloomberg)
Treasury 10-year bonds snapped three days of declines as European leaders prepare to meet for the second time in four days tomorrow in a bid to solve the euro area’s sovereign debt crisis. The yield on benchmark 10-year notes retreated from near the highest level in a week as a European Union document showed that boosting the effectiveness of the region’s bailout fund will require further talks with investors. The Federal Reserve is scheduled to purchase as much as $5 billion of Treasuries today as part of its plan to stimulate U.S. economic growth through lower borrowing costs. “Our bias remains negative with some of the European policy responses still looking clearly inadequate,” said Skye Masters, a rates strategist at Royal Bank of Scotland Group Plc in Sydney. “Technicals and market positioning look supportive for Treasuries and for yields to go lower. We would still be looking for opportunities to add to longs rather than go short.” A long position is a bet an asset will rise in value.

Japanese Stocks Swing Between Gains, Losses; NGK Plunges on Fire Report (Source: Bloomberg)
Japan’s Nikkei 225 (NKY) Stock Average swung between gains and losses as commodity producers and manufacturers of construction equipment gained, while steelmakers fell amid concern prices of the material will drop. Komatsu Ltd. (6301), the world’s second-largest maker of building machinery, rose 3.6 percent after bigger rival Caterpillar Inc. posted earnings that beat estimates. Tokyo Steel Manufacturing Co. led steel producers lower after Bank of America Merrill Lynch cut ratings in the sector. NGK Insulators Ltd. (5333) plunged 27 percent after a report the maker of electrical parts and industrial ceramics asked customers not to use its some its batteries following a fire. The Nikkei 225 slid 0.3 percent to 8,819.28 as of 9:54 a.m. in Tokyo, after rising as much as 0.3 percent. The broader Topix index fell 0.4 percent to 752.13, with more than twice as many stocks declining as gaining.

European Stocks Gain on China Growth; BHP Billiton Rises, Greek Banks Drop (Source: Bloomberg)
European stocks climbed to their highest level in 11 weeks as signs of stronger growth in China and Japan outweighed a selloff in Greek lenders after a meeting of euro-area leaders discussed the region’s debt crisis. BHP Billiton Ltd. (BHP) and Rio Tinto Group led a rally in mining companies as metal prices surged in London. TomTom NV (TOM2) soared 19 percent after posting earnings that topped analysts’ estimates. National Bank of Greece SA (ETE) tumbled 21 percent amid reports that creditors may have to write down as much as 60 percent of their holdings in Greek debt.
The benchmark Stoxx Europe 600 Index rose 1.3 percent to 242.03 at the close in London, climbing for a second day to its highest level since Aug. 4. The gauge has rallied for four straight weeks, its longest stretch of weekly gains since December, amid speculation the euro area’s political leaders will find a solution to the crisis that has Greece on the edge of a default. The measure has still plunged 17 percent from this year’s high on Feb. 17.

EU Signals Fund Leverage Needs More Talks (Source: Bloomberg)
Boosting the effectiveness of Europe’s bailout fund will require further talks with investors as German lawmakers prepare to vote on its new powers tomorrow, a European Union document showed. While the European Financial Stability Facility can be bolstered under two models that may be combined and implemented “quickly,” the extent to which the fund is leveraged can only be ascertained after discussions with investors and rating companies, the document provided to German lawmakers said. The draft underscores the gaps remaining in European Union efforts to address the debt crisis as Chancellor Angela Merkel and fellow leaders prepare to return to Brussels tomorrow for a second summit in four days. Leaders are still jousting with banks over the size of losses they take on Greek bonds while deliberating over leveraging the fund after ruling out tapping the European Central Bank’s balance sheet.

JPMorgan’s Kasman Sees ‘Drags’ Weighing on U.S. Growth in 2012: Tom Keene (Source: Bloomberg)
The European debt crisis and government belt-tightening may cause the U.S. economy to slow in early 2012 even as the risk of it faltering this year has waned, said JPMorgan Chase & Co. chief economist Bruce Kasman. “As we are picking up some steam, we’re now obviously facing a new set of drags, mostly emanating from Europe,” Kasman said today in a radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “We also have this uncertainty about where U.S. fiscal policy is heading.” Economic growth may slow to 1 percent early next year “on the back of Europe going into recession and on the back of fiscal tightening” in the U.S., New York-based Kasman said. The slowdown may lead to a rise in the unemployment rate, which was at 9.1 percent in September for a third month.

Italy, Spain May Be Biggest Losers in European Bank Capital Plan (Source: Bloomberg)
Italian, Portuguese and Spanish lenders will bear the brunt of a 100 billion-euro ($139 billion) plan to recapitalize European banks, while their counterparts in the U.K., Germany and France may avoid raising additional funds. European policy makers, trying to reach agreement before a meeting in Brussels tomorrow on how to tackle the euro zone crisis, may force banks to boost core Tier 1 capital to 9 percent of risk-weighted assets by the end of June, two people with knowledge of the talks said. UniCredit SpA (UCG), Italy’s largest bank, Banco Comercial Portugues SA (BCP), Portugal’s second-biggest, and Banco Bilbao Vizcaya Argentaria SA (BBVA), Spain’s No. 2, are among companies analysts say may have to raise the most capital.
Lenders may be able to mark up the value of bonds that are trading above face value, allowing them to mitigate the cost of writing down their southern European sovereign debt, the people said. That may benefit U.K. and German lenders such as Royal Bank of Scotland Group Plc (RBS) and Deutsche Bank AG (DBK), whose biggest holdings of bonds are those issued by their own governments. It may also allow French banks to avoid further fundraisings.

Hungary May Hold Interest Rates as Europe’s Debt Crisis Raises Risk Costs (Source: Bloomberg)
Hungary will probably leave interest rates unchanged for a ninth month as the European debt crisis raises the country’s borrowing and risk costs and the forint weakens, eliminating room to ease policy. The Magyar Nemzeti Bank will keep the benchmark two-week deposit rate at 6 percent today, according to all 20 economists surveyed by Bloomberg. The decision will be announced at 2 p.m. in Budapest, with central bank President Andras Simor to comment at 3 p.m. As European leaders grapple to contain the euro area’s credit crisis, investors are demanding higher yields on riskier debt. The forint weakened 2.8 percent against the euro since the last rate-setting meeting, Hungary’s credit-default swaps rose to the highest in 2 1/2 years and the five-year bond yield this month reached the highest since January. That may outweigh the central bank cutting its 2012 growth forecast last week.

Spain Slipping on Deficit Means Chances of Contagion Increase: Euro Credit (Source: Bloomberg)
Spain will struggle to meet its deficit-reduction target this year as economic growth slows, threatening further debt-crisis contagion as Europe fails to erect a fail-proof firewall. “They will never make it,” said Ludovic Subran, chief economist at credit insurer Euler Hermes SA in Paris. “Our September forecast sees Spain’s deficit at 7 percent” of gross domestic product this year, he said, adding that the prediction was made before the nation’s credit rating was cut this month. Spain’s benchmark 10-year bond climbed seven basis points to 5.54 percent yesterday after European leaders ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund. The government has aimed for a deficit equal to 6 percent of GDP this year, down from 9.2 percent in 2010. Data on the deficit for the first nine months of 2011 will be published sometime this week.

Euro Strategists Draw Line in Sand at $1.34 as Merkel Seeks to Save Union (Source: Bloomberg)
Foreign-exchange strategists have ceased cutting forecasts for the euro as European government officials intensify efforts to end the region’s crisis and traders pare bets for a collapse in the currency. Between Sept. 12 and Oct. 6 the median year-end estimate of more than 40 analysts surveyed by Bloomberg tumbled to $1.35 from $1.43. It has ranged between $1.34 and $1.35 since then. The 17-nation currency, which closed at $1.3896 on Oct. 21, has strengthened 2.5 percent from last month’s low on Sept. 12 against a basket of developed-nation peers measured by Bloomberg Correlation-Weighted Indexes. For all the concern that European officials led by German Chancellor Angela Merkel and French President Nicolas Sarkozy may not be able to fix the region’s sovereign debt crisis, the $4 trillion-a-day currency market is signaling that the worst may be over for the euro. Leaders meeting yesterday outlined plans to aid banks and ruled out tapping the European Central Bank’s balance sheet to boost its rescue fund.

Merkel Plans to Seek German Parliamentary Approval for EU Summit Measures (Source: Bloomberg)
Chancellor Angela Merkel will seek backing from German lawmakers to bolster the euro bailout fund on the same day she heads to a European summit, as banks joust with leaders over the size of losses they take on Greek bonds. Leveraging the European Financial Stability Facility rescue fund to more than 1 trillion euros ($1.4 trillion) and how far to cut Greece’s debt load emerged as two main hurdles in the way of a deal to stop the debt crisis at the Oct. 26 European Union summit, the second in four days. The euro weakened as Merkel’s party proposed a full vote in parliament, also on Oct. 26. “We are still missing some important parts of the complex puzzle that is how to solve Europe’s debt crisis,” Kathleen Brooks, research director at Forex.com in London, said today. “The biggest challenge for the German Chancellor over the next 48 hours is to persuade the German Bundestag to agree to the changes to the EFSF.”

20111025 0954 Global Commodities Related News.

Hedge Funds Hike Bullish Commodity Bets (Source: Bloomberg)
Hedge funds increased bullish bets on commodities by the most since August on mounting optimism the global economy will avoid another recession, boosting prospects for raw-materials demand.  Money managers raised combined net-long positions across 18 U.S. futures and options by 12 percent to 737,647 contracts in the week ended Oct. 18, Commodity Futures Trading Commission data show. Wagers increased most in energy and agriculture, led by heating oil, gasoline, coffee and soybeans. The Standard & Poor’s GSCI gauge of 24 commodities has climbed 9.2 percent in October, on track for the biggest monthly advance this year, as European leaders moved closer to resolving the region’s debt crisis. Reports last week showed U.S. housing starts jumped to the highest since April 2010 and manufacturing unexpectedly accelerated, increasing investor confidence that the world’s largest economy isn’t tipping back into recession.

Corn (Source: CME)
US corn futures end slightly higher as weakness in the US dollar supports prices, as does gains in other commodities ranging from wheat to oil to equities. Yet, the market felt some pressure from the advancing harvest. The USDA, in a weekly report due at 4 pm EDT, is expected to estimate the corn harvest is nearly 75% complete, up from 47% a week ago. Some farmers say they are selling their crops to take advantage of recent gains in prices. CBOT December corn edges up 1 3/4c to $6.51/bushel.

Wheat (Source: CME)
Most US wheat futures finish higher on broad buying of commodities and equities. Optimism about progress in solving the euro zone's debt crisis encouraged traders to increase risk across assets, with some buying back previously sold positions in wheat. Traders estimate commodity funds bought an estimated 2,000 contracts, a modest amount, but "the biggest thing is you've got some fund investment coming in here," says Alan Brugler of Brugler Marketing & Management. CBOT December wheat climbed 10 1/2c to $6.42 1/2 a bushel and KCBT December gained 12c to $7.35. MGEX pulled back after recent gains, with the December contract slipping 2c to $9.17 1/4.

Rice (Source: CME)
US rice futures settle limit up, finishing at a 1-month high, on concerns about flooding reducing exports from Thailand. Losses at the world's top rice exporter would tighten global supplies, sending prices higher. CBOT November rice jumps the 1-day 50c maximum at the CBOT, with the November contract finishing at $16.90 1/2 per hundredweight. The daily limit will temporarily expand to 75c Tuesday.

Wheat Board can thrive in open market - Viterra CEO
WINNIPEG, Manitoba, Oct 21 (Reuters) - Canada's biggest grain handler, Viterra Inc , is willing to work with the Canadian Wheat Board in an open market system and thinks the board can thrive without its marketing monopoly, Chief Executive Mayo Schmidt said on Friday.
Ottawa intends to pass legislation by the end of 2011 to end the Wheat Board's 69-year-old grain monopoly as of August 2012, allowing Western Canada's farmers to sell wheat and barley for milling or export directly to grain handlers.

Wheat up 1.3 pct, soy rebounds on EU optimism
SINGAPORE, Oct 24 (Reuters) - U.S. wheat rose more than 1 percent, gaining for a third straight session, while corn was up 0.9 percent as European leaders moved closer to a plan to resolve the region's debt issues at a weekend meeting.
"The dollar is under pressure and overall commodities are a bit firmer, it seems to be macro driven," said Brett Cooper, a senior manager of markets at FCStone Australia.

Australia's wheat harvest cranks up, record exports likely
SYDNEY, Oct 24 (Reuters) - Australia is on track to reap a near-record wheat crop in 2011/12 thanks to benign weather in the country's top grain exporting state of Western Australia, analysts and traders said on Monday.
The world's fourth largest shipper of the grain could export as much as a record 21 million tonnes in the marketing year to September 2012, said Andrew Woodhouse, an advisor at commodities trading firm Advance Trading Australasia.

South America 2012/13 rice export to fall 20 pct
HO CHI MINH CITY, Oct 21 (Reuters) - Paddy rice exports from four South American producers in the  2012/2013 trading season would fall around a fifth from this year to a combined 2.4 million tonnes, after shipments tripled in the current season, a senior agricultural researcher said on Friday.
The net paddy export by Argentina, Brazil, Paraguay and Uruguay to countries outside the Mercosur economic block would fall from 3.05 million tonnes traded in the current 2011/2012 season, Bruno Lanfranco of the National Agricultural Research Institute of Uruguay said.

Algeria Jan-Sept wheat imports up 36 percent
ALGIERS, Oct 23 (Reuters) - Algeria's soft and durum wheat imports reached 5.72 million tonnes in the first nine months of 2011, customs data showed, a 35.9 percent increase on the same period last year.
Soft wheat imports rose to 4.43 million tonnes from 2.97 million tonnes in the January-September period of 2010, while durum wheat purchases were 1.28 million tonnes, up from 1.23 million tonnes.

Ukraine winter grain sowing 92% complete -ministry
KIEV, Oct 21 (Reuters) - Ukrainian farms have sown 7.45 million hectares of winter grains for the 2012 harvest as of Oct. 21, or 92 percent of an initial forecast of 8.15 million hectares, the ministry said on Friday.
It said in a statement the sown area included 6.15 million hectares of winter wheat (94 percent of the forecast), 986,000 hectares of winter barley (80 percent of the forecast) and 322,000 hectares of winter rye (95 percent of the forecast).

Kazakh harvest 99 pct complete, on track for record
ASTANA, Oct 21 (Reuters) - Kazakhstan, expecting a record post-Soviet grain crop, has threshed 28.2 million tonnes of grain by bunker weight with 99 percent of the harvesting campaign complete, the Agriculture Ministry said on Friday.
The ministry said in a statement the average yield as of Oct. 21 was 1.77 tonnes per hectare, or 0.88 tonnes per hectare better than during last year's drought-hit harvest.

Thai Floods Are Driving Rice Prices (Source: CME)
Global rice prices may move up further in the next few months as flooding in Thailand continues to affect the crop and damage existing inventories. Importers are looking for alternative supply, but the perception gaining ground is that despite cheaper rice available from sources such as India and Pakistan, they won't be able to do without any supply from Thailand and Vietnam. The two control more than half of the rice moving in global trade. Vietnamese prices have moved up in tandem with Thailand's, hitting three-year highs with more expected. The price for a ton of Thai 5% broken grade rice, currently about $600, free-on-board -- up 20% since the start of the second quarter -- is forecast to hit $700 to $800 by the end of the year. The damage due to floods is worse than was initially feared. The loss is the equivalent of around three million metric tons of milled rice, or 20% of the country's main rice crop, said Jeremy Zwinger, chief executive of the Rice Trader, a California-based consultancy.
Supply for exports will be further limited by a government program that will buy most of the rice from farmers at 15,000 baht ($485) a ton, around 40% above market rates for unmilled rice. Rice, the world's most widely consumed staple food, is Asia's leading food crop. Food prices were a major factor in accelerating inflation around Asia earlier this year, and even where overall inflation has slowed, food-price pressure remains. China's consumer price index in September was up 6.1% from a year earlier, compared with August's 6.2% -- but food prices were up 13.4%. Wholesale food inflation in India hit double digits in the week ended Oct. 8, with prices up 10.6% from a year earlier. While floods are hitting Thailand, dry weather in the U.S. has cut production there, which normally accounts for more than 10% of the global rice trade.
Indonesia, the world's largest importer of rice, may buy directly from government agencies in India and Pakistan, said Mohammad Ismet, an adviser to Bulog, the country's procurement agency. Angelito Banayo, administrator of the Philippines National Food Authority, echoed that sentiment -- though the Philippines has long-term supply agreements with Thailand and Vietnam. Indian rice is running about $150 a ton less than Thai rice. With Thai and Vietnamese prices rising, India has already become a significant global supplier, offering rice in a recent Iraqi tender and to the United Nations' World Food Program. Officials have said India will export at least two million tons of ordinary rice over a period of four to six months. Pakistan is also expected to export an additional one million tons of rice in the marketing year starting Nov. 1, said Fuad Hamid Garib, director at Garibsons Ltd., one of the country's leading rice exporters.
Such sales notwithstanding, importers including sub-Saharan Africa will still need 12 million to 15 million tons of rice from Thailand and Vietnam in the next year, perhaps at sharply higher prices.

UN Expert: Contract Farming Is The Next "Land-Grab" (Source: CME)
Big business is driving a new form of "land-grabbing" by using long-term contracts to exploit smallholder farmers in the developing world, the United Nation's food expert will say. At the U.N. special assembly, Olivier De Schutter, the body's special rapporteur on the right to food, will call on governments to ensure poor farmers are not locked into unequal relationships with dominant companies. And while he agrees that the private sector will be a crucial source of much-needed investment in the sector, he told Dow Jones Newswires that the spate of projects run by companies like Nestle S.A. and Danone s.a. in the developing world should not be seen as a "panacea" for feeding the world. "Over the past few years, particularly since the food price crisis of 2008, we've seen a huge reinvestment in agriculture in which commodity buyers are trying to control the supply of the crops that they depend on," he said in an interview ahead of his annual U.N. presentation.
"But for farmers, this can be a way to make them highly dependent on the goodwill of one contractor. I hope [this report] will shift lines and overcome the ideological divide that contract farming is some kind of panacea." Investments by food importing countries in cheap farmland in the developing world has surged in recent years. A report by international aid group Oxfam last month found that 227 million hectares of land, an area the size of north-west Europe, has been leased or sold in the developing world--largely Africa--since 2001 and experts predict the trend will continue as food prices rise. Human rights groups say such schemes undermine the land rights of local people, push up food prices by using land to produce cash crops for export rather than for local markets and damage the environment. De Schutter argues that contract farming, in which farmers agree to supply large companies with particular crops at predetermined prices, often has the same affects.
He cited cases where farmers have fallen into debt as their contracts have forced them to buy expensive inputs like fertilizers from a single supplier, or grown cash crops only to find themselves unable to feed their families. In some cases, plantations have been divided up into smaller plots to ensure the buyers aren't forced to pay benefits to their growers. "Many farmers in developing countries are extremely suspicious of these kind of schemes," he said. Instead, he argues that governments must strengthen competition law to ensure no one company has a monopoly over a particular sector and farmers must improve their bargaining power through the creation of cooperatives or public-private partnerships. "We must empower smallholders to negotiate decent terms with buyers, and we must explore the most inclusive business models," he said.

High coffee price may tempt Vietnam; rubber bounces
SINGAPORE, Oct 24 (Reuters) - Gains in global coffee prices could tempt farmers in Vietnam, the world's largest robusta producer, to sell more beans this week as the crop progresses, while Tokyo rubber futures could find support from supply constraints, dealers said.
"Vietnam's sellers would be unable to keep coffee for too long because they have limited space in their warehouses, and there's a new crop coming in," said Lynette Tan, an analyst with Phillip Futures in Singapore.

Vietnam lowers Sept coffee export to 27,000 T-customs
HANOI, Oct 24 (Reuters) - Vietnam exported 27,000 tonnes (450,000 bags) of coffee in September, down 24.6 percent from a year ago, the customs department said on Monday, slightly below a government estimate last month of 30,000 tonnes.
The volume, also well below traders' estimates of between 60,000-70,000 tonnes, brought the cumulative January-September export volume to 997,000 tonnes, or 16.62 million 60-kg bags, up 8.4 percent from a year ago, the Finance Ministry-run Vietnam Customs said in a report.

Rain-damaged road delaying Colombian coffee
BOGOTA, Oct 21 (Reuters) - Torrential rains and landslides in Colombia have delayed some coffee getting to market with even more heavy rain expected in the coming months due to the La Nina weather phenomenon.
So far local prices have been unaffected, growers and exporters say. Even so, December arabica futures on the ICE exchange  were up 5.5 percent at midday on Friday, an increase attributed in part to even worse rains in Central America that have damaged crops there.

Dry Sept to slightly boost Brazil cane quality
GUARUJA, Brazil, Oct 21 (Reuters) - Dry September weather in Brazil's center-south cane belt should slightly boost sugar output at the end of the current season approaches, Canaplan consultants said on Friday.
But the lack of rain will count as a negative factor against the performance of the next crop which needs good rains during the early stages of growth, said Caio Carvalho, Canaplan director on the sidelines of a cane event.

Russia unlikely to import raw sugar in 2011 -Zubkov
MOSCOW, Oct 21 (Reuters) - Russia, formerly the globe's third-largest sugar buyer, is unlikely to import more raw sugar this year as it expects record domestic beet sugar output, First Deputy Prime Minister Viktor Zubkov said on Friday.
"We will import no (raw) sugar this year. Probably. We will export," said Zubkov, who is in charge of the country's agriculture, at a teleconference on shipments of agricultural commodities.

EU to be net sugar importer despite reform
BRUSSELS/LONDON, Oct 21 (Reuters) - A plan to abolish European Union sugar production limits would lead to a modest increase in output and softer EU beet sugar prices, but the bloc would still remain a net importer for three years or longer.
The latest reform plan announced on Oct. 12 would end the EU's system of national sugar production quotas and minimum beet prices from 2015, not in 2016 as had been suggested in earlier drafts of the reform plans.

Euro Coal-Dec S.African trades at $109.75/T
LONDON, Oct 21 (Reuters) - Prompt physical coal prices were stable on Friday after having fallen through the week by over $5 a tonne due to weak demand in Europe and Asia, as a rise in oil prices provided some support.
Traders in particular returned with a more bearish outlook from the annual Coaltrans conference earlier in the week.

China's 2011 net coal imports seen about 150 mln T-body
SHANGHAI, Oct 21 (Reuters) - China's net coal imports are expected to rise 3 percent to around 150 million tonnes this year, the country's coal association said on Friday, adding that overall domestic supply and demand was expected to be balanced in the coming winter.
The projected import growth would mark a significant deceleration from the previous year, however. Net coal imports by the world's top coal consumer and producer in 2010 were 145.8 million tonnes, or a jump of 40 percent from 2009.

China energy chief says winter gas market seen in balance
BEIJING, Oct 24 (Reuters) - China's natural gas supply and demand in the winter-spring season will generally be in balance, but supply will be strained if low temperatures last longer than expected and gas demand from power generation surges, the country's energy chief said.
With a steady increase in output and imports, gas supplies will increase nearly 20 percent in the winter-spring season from a year ago, Liu Tienan, a deputy head of the powerful National Development and Reform Commission (NDRC) and head of National Energy Administration, told a gas conference on Friday.

China's daily LNG imports at record high in September
BEIJING, Oct 24 (Reuters) - China's imports of liquefied natural gas (LNG) averaged 38,286 tonnes per day in September, the highest daily rate since China started to ship in the fuel in 2006, data from the General Administration of Customs of China showed on Monday.
Last month's imports of the super-chilled gas increased nearly 17.5 percent from a year earlier to 1.15 million tonnes, second only to the monthly record high of 1.18 million tonnes in July.

Japan Sept crude oil import volume down 4.4 pct y/y
TOKYO, Oct 24 (Reuters) - Japan's crude oil imports fell 4.4 percent in September from the same month a year earlier, while liquefied natural gas imports rose more than 10 percent for the fifth straight month as gas-fired power generation has surged following the March earthquake, the Ministry of Finance said on Monday.
The decline in crude oil imports came as factors such as reconstruction after the massive quake and tsunami, and rising demand for direct-burn crude for power generation, have yet to offset slowing oil demand from a sluggish economy.

Brent, U.S. oil up on China data, EU optimism
SINGAPORE, Oct 24 (Reuters) - Brent neared $111 a barrel and U.S. crude climbed above $88.50 as optimism over a solution to the euro zone's debt crisis and stronger Chinese manufacturing data drummed up investor confidence.  
"A key reason why prices are trending higher is that the (Chinese) number was positive. The market was worried that there would be another number below 50," said Melbourne-based Natalie Robertson of ANZ bank.

Oil Rises a Third Day on Economic Growth Outlook; Brent Premium Narrows (Source: Bloomberg)
Oil rose for a third day in New York as investors bet that signals of economic growth indicate fuel demand will increase. Brent’s premium to U.S. prices narrowed for a third day. Futures climbed as much as 0.5 percent after yesterday surging 4.4 percent to the highest settlement in almost 12 weeks. A satellite survey showed inventories at Cushing, Oklahoma, the delivery point for West Texas Intermediate crude, fell 760,000 barrels last week. A report today may show U.S. consumer confidence rose a second month. European leaders may agree tomorrow on a blueprint to tame the region’s debt crisis. “Risk appetite for commodities has sharply improved,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note. “Trade was heavy for U.S. crude, flipping the curve structure into backwardation for the first time since 2008, as market participants took direction from positive developments in Europe and the U.S. and priced-in for tighter supplies.”

Europe steel output growth to slow in 2012 -Eurofer
LONDON, Oct 21 (Reuters) - Growth of Europe's steel production will slow in 2012 along with activity in the steel-using sectors, Eurofer, the European steel producers association, said on Friday.
Steel production in Europe will rise by almost 6 percent in 2011, and then growth will slow to 2.6 percent in 2012, Eurofer forecast.

China Sept steel output at 2011 low -Worldsteel data
LONDON, Oct 21 (Reuters) - Annualised global steel output fell in September to its lowest this year in top producer China as a gloomier economic growth outlook made buyers cautious and weakened demand, according to a Reuters calculation based on World Steel Association data.  
Annualised global steel production however, rose in September as many steel mills boosted activity after the summer slowdown in the northern hemisphere.

Industrial Metals Soar Most in Three Years on European Talks, China Demand (Source: Bloomberg)
Industrial metals in London jumped the most in three years, led by copper and nickel, as European governments moved closer to containing the region’s debt crisis and manufacturing rebounded in China, the world’s top consumer. European leaders outlined plans to aid banks and ruled out borrowing unlimited amounts from the European Central Bank to boost a rescue fund. Chinese manufacturing may expand in October, ending the longest contraction since 2009, according to a preliminary purchasing-managers’ index. “Most markets seem to be relieved by the progress made over the weekend by European leaders,” Edward Meir, a senior commodity analyst at MF Global Holdings Ltd. in Darien, Connecticut, said in a report. Industrial metals are “also teeing off somewhat disproportionately” on Chinese manufacturing, he said.

Iron Ore-Spot may extend losing streak, but China PMI gives hope
SINGAPORE, Oct 24 (Reuters) - Spot iron ore prices are likely to stretch losses this week after falling last week by the most since July 2010, on slack demand from top importer China as mills wait for prices to drop further before returning to the market.
But a sharp rise in China steel futures, which tracked gains in other commodities after manufacturing data eased fears about a hard landing in the world's second-biggest economy, raised hopes iron ore prices could see a slower pace of decline.

Japan eyes cutting long-term iron ore buys-Nikkei
TOKYO, Oct 23 (Reuters) - Japan's major steel makers are seeking to reduce purchase volumes from more expensive long-term iron ore contracts and are looking at buying more from the cheaper spot market instead, the Nikkei business daily said on Sunday.
Spot iron prices have slid to their lowest in a year and are set to post their biggest weekly decline in 15 months as demand from top importer China remains thin, fuelling expectations prices could drop further.

Gold Gains Second Consecutive Session as Commodities Jump on China Data (Source: Bloomberg)
Gold rose for a second straight session, tracking gains in others commodities, as renewed optimism for growth in China boosted prospects for raw-material demand. The Standard & Poor’s GSCI Index of 24 raw materials climbed as much as 2.7 percent after reports showed China’s manufacturing may rise in October for the first time in four months. Gold also advanced on concern that U.S. monetary policy aimed at shoring up growth will spur inflation. Federal Reserve Vice Chairman Janet Yellen said on Oct. 21 that a third round of large-scale securities purchases may become warranted to boost the economy. “Optimism about Chinese growth is pushing all commodities higher, including gold,” Fred Schoenstein, a trader at Heraeus Precious Metals Management in New York, said in a telephone interview. “Some people are also looking at it as a safe-haven investment.”

Car Carriers Profit From Record Global Demand as Shipping Slumps: Freight (Source: Bloomberg)
Ships capable of hauling 4,000 cars across the world’s oceans may make the most money next year since the global recession as production reaches a record and demand from emerging markets swells cargoes.  Shipments will rise 10 percent to 12.7 million vehicles in 2012, more than twice the fleet’s expansion, according to ABG Sundal Collier ASA, an investment bank in Oslo. Rates for the 550-foot vessels will gain 36 percent to $15,000 a day, RS Platou Markets AS estimates. Wilh. Wilhelmsen ASA, Europe’s biggest owner of the ships, will boost profit for at least two more years, analyst estimates compiled by Bloomberg show. Global car sales will rise 8.5 percent to 80.7 million in 2012, according to researcher JD Power & Associates. Demand is being led by developing nations, which will expand 6.1 percent next year, compared with 1.9 percent for advanced economies, the International Monetary Fund predicts. For owners of car carriers, that means profit at a time when freighters hauling commodities are losing money.

Baltic index slips, China iron ore demand watched
LONDON, Oct 21 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, turned negative on Friday, although the larger capesize market remained supported by healthy iron ore and coal exports to China.
Brokers said growing vessel supply, which was outpacing commodity demand, was set to cap dry bulk freight rate gains in the coming months, with economic uncertainty adding to headwinds.

20111025 0953 Soy Oil & Palm Oil Related News.

ITS CPO export up 16.4% to 1,395,935 tonnes for the period of 1~25 Oct 2011.
SGS CPO export up 13.5% to 1,366,499 tonnes for the period of 1~25 Oct 2011.

Soybeans (Source: CME)
US soybean futures end higher, rising on broader-based investor buying in commodity markets. Improved outlooks for the global economy, with better industrial data from China and hope that the EU will push toward a plan that would alleviate Europe's debt crisis attracts buyers, analysts say. Firm cash prices, with end users aggressively searching for supplies while farmers continue to opt to store inventories instead of marketing them added to the higher price theme. CBOT Nov soy end up 1.2% at $12.26 3/4/bushel; Jan soy end up 1.2% at $12.35 1/4.

Soybean Meal/Oil (Source: CME)
Soy product futures rally in step with soybeans, buoyed by renewed interest in commodities on improved global economic sentiment. Soymeal futures drew further support from firm cash basis levels amid talk of processors having trouble securing soybeans with high protein counts to produce hi-pro soymeal, analysts say. CBOT Dec soymeal end up 1.6% at $321.50/short ton; Dec soyoil end up 1.1% at 51.79c/pound.

Palm oil up on Euro optimism, lower output
JAKARTA,, Oct 24 (Reuters) - Malaysian palm oil futures rose , as possible progress on the euro zone debt problems combined with expectations of lower output for the edible oil, helped boost sentiment.
"There is a bit of strength coming from higher crude oil and the Dalian," said a palm oil dealer in Kuala Lumpur. "The feeling in the palm market now is not too bearish because we're expecting to see production coming off.

Argentine farmers begin 2011/12 soy seeding -gov't
BUENOS AIRES, Oct 21 (Reuters) - Argentine farmers began to plant soy this week for the 2011/12 season as recent rains boosted soil moisture, the Agriculture Ministry said in its latest report on Friday.
Argentina is the world's top soymeal and soyoil exporter and the third-biggest soybean supplier. The government says farmers will produce between 52 million tonnes and 53 million tonnes this season, up from 48 million tonnes last season.

Forward sales of Argentina 2011/12 soy up 50 pct
BUENOS AIRES, Oct 21 (Reuters) - Forward sales of Argentina's 2011/12 soy crop have barely started and already have surpassed by 50 percent the sales booked at this time last year and growers are using the sales to finance planting.
The agriculture ministry said that through Oct. 12 exporters had bought 4.2 million tonnes of the 2011/12 crop, compared with 2.7 million tonnes previously.