Friday, June 15, 2012

20120615 1137 Global Commodities Related News.

Pro Farmer: After the Bell Wheat Recap (Source: CME)
Chicago wheat ended with gains of 3 1/2 to 7 1/2 cents. Kansas City ended 2 1/4 to 5 3/4 cents higher. July Minneapolis wheat was the upside leader, closing 17 3/4 cents higher, while deferred months saw gains of 3 to 8 1/4 cents. Futures trimmed gains slightly in after-hours trade. Futures benefited from spillover from corn, stronger-than-expected weekly export sales of 432,900 metric tons (MT) for 2012-13 and a daily sale to China for 110,000 MT of SRW wheat.

Wheat Market Recap Report (Source: CME)
July Wheat finished up 6 1/2 at 622 1/2, 6 1/2 off the high and 7 1/2 up from the low. December Wheat closed up 6 at 665 1/2. This was 6 3/4 up from the low and 4 3/4 off the high. July wheat closed moderately higher on the session but down off of the early highs. Firm export demand and continued talk of tightening world supply for the coming season compared with the past few years helped to support. In addition, improved demand news and China import demand helped to support. Private exporters reported a sale of 110,000 tonnes of US soft red winter wheat which was the highest to China in 8 1/2 years. Net weekly export sales for wheat came in at 432,900 metric tonnes which was about as expected. As of June 7th, cumulative wheat sales stand at 17.7% of the USDA forecast for 2012/2013 (current) marketing year versus a 5 year average of 18.1%. Sales of 502,000 metric tonnes are needed each week to reach the USDA forecast. The European Union granted export licenses for 117,000 tonnes of wheat this week which pushed cumulative sales for the marketing year to 12.3 million tonnes as compared with 18 million last year at this time. European milling wheat futures closed slightly higher and uncertainty for euro zone debt issues remains a source of uncertainty for commodity traders. July Oats closed down 1/4 at 305 1/2. This was 1 1/2 up from the low and 7 1/4 off the high.

Pro Farmer: After the Bell Corn Recap (Source: CME)
Corn futures ended with gains of 4 1/4 to 9 cents through the September 2013 contract, with front-month July leading gains. Futures were little changed in after-hours trade. Support for corn futures was largely twofold today: 1) Strong basis levels sparked rumors China was buying corn, and 2) the forecast is looking less favorable than it initially did for widespread rains for the Midwest over the near-term.

Corn Market Recap for 6/14/2012 (Source: CME)
July Corn finished up 8 1/4 at 600 3/4, 7 3/4 off the high and 9 up from the low. December Corn closed up 6 1/2 at 517. This was 7 3/4 up from the low and 4 1/4 off the high. July corn was trading about 8 1/2 cents higher on the session late in the day which was well off of the mid-session highs while December was up near 6 1/2 cents late. Ideas that the rain into next week will benefit the western Corn Belt but areas in the east which receive 1/2 inch or less may not be enough to alleviate threatening crop conditions into the pollination period helped to support. Ideas that the weakness yesterday was overdone and some short-covering due to very strong domestic cash markets added to the positive tone. Weekly export sales came in well below trade expectations at just 92,100 metric tonnes for the current marketing year and 77,700 for the next marketing year for a total of 169,800. As of June 7th, cumulative corn sales stand at 92.0% of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 91.6%. Sales of 273,000 metric tonnes are needed each week to reach the USDA forecast. Traders continue to see uncertainty over euro zone debt issues and this was seen as a limiting factor on the upside. July Rice finished up 0.075 at 13.97, equal to the high and 0.08 up from the low.

Soy at 1-week low on risk aversion, corn up for 2nd day
SINGAPORE, June 14 (Reuters) - Chicago soybeans slid around half a percent, falling to a one-week low as concerns over global rowth weighed on the market, while spot-month corn rose for a second straight session on tight old-crop supplies.
"What we are seeing is that macro factors are driving the market right now," said Abah Ofon, an analyst at Standard Chartered Bank in Singapore. "The crisis in Europe and concerns over global growth are clouding the outlook, forcing people to come out of risky assets."

Algeria sees 2012 grain harvest exceeding 5.8 mln t
ALGIERS, June 14 (Reuters) - Algeria expects its grain harvest for this year to reach 5.8 million tonnes or even exceed that level due to better weather conditions and incentives for farmers, its agriculture minister said on Thursday.
"We will reach around 58 million quintals (5.8 million tonnes). The figure may exceed 58 million quintals if there are no problems including fire usually caused by high temperatures," the minister, Rachid Benaissa, told state radio.
Rains aid China's corn, may limit yield losses
BEIJING, June 14 (Reuters) - Heavy rains have improved growing conditions in China's top corn producing provinces, which could limit the damage inflicted by a prolonged period of dryness with forecasts of more crop-friendly weather in the coming days.
A higher-than-expected corn output in China, the world's second largest consumer and producer of the grain, may cap its imports and weigh on the U.S. new-crop December corn  - which has already been hit by forecasts for more rains in the Midwest and is on track to record its steepest weekly fall in seven months.
Thai exporter turns to Cambodia for cheaper rice
BANGKOK, June 14 (Reuters) - Asia Golden Rice Co.Ltd, Thailand's second-biggest rice exporter, is investing in neighbouring Cambodia to secure cheaper rice as costs rise at home and is confident of finding a market in the European Union, the company's president said on Thursday.
"We see an opportunity to develop milling technology to produce quality milled rice varieties and export from there," Sombat Chalermwutinan told Reuters in an interview.

Strategie Grains lifts EU wheat view on good weather
PARIS, June 14 (Reuters) - Analyst Strategie Grains on Thursday raised its forecast for this year's soft wheat harvest in the European Union after favourable growing weather in the past month.
The analyst had slashed its EU wheat crop outlook by 8.5 million tonnes over the previous two months as it factored in damage from frost and dryness, but it now said rain across much of Europe in May had improved crop conditions.
Cooperatives cut German 2012 wheat crop forecast
HAMBURG, June 13 (Reuters) - The German Farm Cooperatives Association said on Wednesday it has cut its forecast of the country's 2012 wheat harvest, as damage from the cold winter was worse than thought and dryness threatens part of the German crop.
It now expects a 2012 wheat crop of 21.3 million tonnes compared with the 22 million tonnes estimated in May. This will be 6.2 percent down on the weather-reduced 22.7 million tonnes of wheat Germany harvested in 2011.
FranceAgriMer ups wheat stocks, cuts exports again
PARIS, June 13 (Reuters) - Farm office FranceAgriMer on Wednesday raised its forecast of French soft wheat stocks at the end of this season for the second straight month as it lowered again its outlook for exports, data released on the office's website showed.  
The office increased its forecast of soft wheat stocks at the end of the 2011/12 season on June 30 to 2.51 million tonnes against 2.36 million seen last month, although this was still    down 14 percent on ending stocks in 2010/11.

ICE coffee hits two-year low, sugar slips
LONDON, June 14 (Reuters) - Arabica coffee futures on ICE touched a two-year low in early trade, as Brazil selling weighed, with the harvest in the top producer underway.
Raw sugar and cocoa futures on ICE also eased, as European markets dipped after Spain's credit rating was cut to one notch above "junk", and nervousness grew ahead of a Greek election on the weekend.
Coffee output from Vietnam's current 2011/2012 crop would reach 20 million bags, up 2.7 percent from the previous season, the International Coffee Organization said, raising its estimate by around 9 percent from 18.3 million bags previously.

Vietnam 2011/2012 coffee output, exports seen up
HANOI, June 14 (Reuters) - Coffee output from Vietnam's current 2011/2012 crop would reach  20 million bags, up 2.7 percent from the previous season, the International Coffee Organization said, raising its estimate by around 9 percent from 18.3 million bags previously.
Following the revision for Vietnam, the world's second-largest producer after Brazil, the world production estimate in the current crop year was also lifted to 131.9 million 60-kg bags, from 131.4 million bags, the London-based ICO said in its May report.

Brazil mid crop cocoa deliveries speed up
BRASILIA, June 13 (Reuters) - Deliveries of cocoa from Brazil's main producing regions quickened again in the last week with the May-September mid crop now at peak flow, data from Bahia Commercial Association showed, while the return of rain boded well for the next crop.
The main cocoa-growing state of Bahia churned out 97,693 60-kg bags in the last week, up from 93,267 bags in the week prior. Smaller producing states saw a similar increase to 47,371 bags, up from 42,970 bags.

Cotton Futures Jump on ’Monster’ Export Sales From U.S. (Source: Bloomberg)
Cotton futures rose to a two-week high as exports soared fivefold from the U.S., the world’s biggest shipper. Orange-juice prices fell to a three-week low. Net sales of upland cotton jumped to 1.02 million running bales in the week ended June 7 from 199,233 a week earlier, the U.S. Department of Agriculture said in a report. A running bale weighs 500 pounds, or 227 kilograms. “We’re up because of the absolutely monster sales that were reported,” Mike Stevens, an independent trader in Mandeville, Louisiana, said in a telephone interview. “This shows a tremendous amount of business.” Cotton for December delivery rose 0.3 percent to settle at 70.6 cents a pound at 2:51 p.m. on ICE Futures U.S. in New York. Earlier, the price reached 73.08 cents, the highest for a most- active contract since May 30.
Orange-juice futures for July delivery fell 0.8 percent to $1.0975 a pound in New York. Earlier, the price touched $1.071, the lowest since May 24. The commodity has dropped tumbled 52 percent from a record $2.2695 on Jan. 23. A “double whammy between weak demand and ample supplies” drove prices lower, Fain Shaffer, the president of Infinity Trading in Medford, Oregon, said in a telephone interview.

Coffee Price Drop Endangers Recovery of Colombian 2013 Crop (Source: Bloomberg)
Colombia, the second-largest supplier of Arabica coffee beans, said a slump in prices is putting at risk next year’s recovery in its harvest. A prolonged drop poses a “serious danger” because some farmers are losing money at current prices, Mario Gomez, a member of the board of Colombia’s National Federation of Coffee Growers for about three decades, said in a telephone interview from the city of Manizales in the nation’s central coffee- farming region. “That’s the death of coffee production,” Gomez said. “Losses lead to crops being neglected and then abandoned.” Coffee has declined 16 percent in a month on speculation supplies will increase from Brazil, the top producer of Arabica coffee favored by brewers such as Starbucks Corp. (SBUX) The Colombian federation’s Chief Executive Officer Luis Munoz forecast last month that 2013 output may rebound to a five-year high of 9 million bags as disease-resistant crops aid production.
Arabica-coffee futures for September delivery, slid 2 percent to close at $1.5105 a pound on ICE Futures U.S. in New York. The crop this year, which is being harvested, will be similar to 2011, Munoz said in May. Last year, the nation’s production of 7.81 million bags slid to a 35-year low after above-average rainfall damaged crops. Each bag weighs 60 kilograms (132 pounds).

Oil Gains a Second Day on Stimulus Speculation, OPEC Output Call (Source: Bloomberg)
Oil rose for a second day in New York on speculation that the Federal Reserve may take more steps to stimulate the economy and on OPEC’s call on members to cut production in excess of quotas. Futures advanced as much as 0.7 percent, heading for a second week of gains. Reports showing U.S. jobless claims unexpectedly climbed and the cost of living fell by the most in more than three years fueled speculation that Fed policy makers will discuss stimulus measures when they meet June 19. The Organization of Petroleum Exporting Countries would need to reduce output by 1.6 million barrels a day to comply with its targeted ceiling, Secretary-General Abdalla El-Badri said.
“There are more supportive factors now for oil than there are negative,” Jonathan Barratt, chief executive officer of Barratt’s Bulletin, a commodity-markets newsletter in Sydney, said in a telephone interview. “The whole purpose of the cartel is to provide guidelines to production. Compliance is just a word. If the price slips below $80 a barrel then quotas will change and give prices a big bump.” Oil for July delivery advanced as much as 58 cents to $84.49 a barrel in electronic trading on the New York Mercantile Exchange, and was at $84.25 at 11:19 a.m. Sydney time. The contract increased 1.6 percent yesterday to $83.91, the highest close since June 8. Prices are 0.1 percent higher this week and down 15 percent this year. Brent oil for August settlement rose 57 cents, or 0.6 percent, to $97.74 a barrel on the London-based ICE Futures Europe exchange. The front-month price for the European benchmark contract was at a premium to West Texas Intermediate of $13.15, up from $13.12 yesterday.

OPEC Decision Puts Onus on Saudi Arabian Cuts Should Prices Fall (Source: Bloomberg)
OPEC’s decision to keep its output quota unchanged yesterday puts the onus on the group’s biggest producer, Saudi Arabia, to cut supply should crude prices extend their drop below $100 a barrel. The Organization of Petroleum Exporting Countries would need to reduce output by 1.6 million barrels a day to comply with its targeted ceiling of 30 million barrel a day, OPEC Secretary-General Abdalla El-Badri said yesterday. Increased production from Saudi Arabia has been blamed for plunging prices by members including Iran, whose own exports are likely to be curbed by a European Union embargo starting July 1.
“It puts some of the onus on the Saudis, but at the end of the day, they’re going to remain very responsive to what happens in the world market,” Jason Schenker, president of Prestige Economics LLC, a commodity researcher in Austin, Texas, said in an interview in Vienna yesterday. Iranian supply will “come off the market with the full implementation of the embargo and that could push the number down toward 30 million,” he said Saudi Arabia has led the surge in OPEC’s output above its official limit this year, as Brent crude prices rose in March to their highest since July 2008 on concern sanctions against Iran will disrupt Middle East supply. Since then, signs that Europe’s debt crisis will erode fuel demand have driven the price back below $100, a level favored by Saudi Arabian Oil Minister Ali al-Naimi.

OPEC's new ground rule? Don't mention Iran
(Robert Campbell is a Reuters market analyst. The views expressed are his own)
VIENNA, June 13 (Reuters) - It is no exaggeration to say the impact of the pending U.S. and European sanctions against Iran are one of the most taboo subjects at an OPEC meeting in years.
A visitor from Mars could well walk away from the day to day events in Vienna under the impression that the impending U.S. and European sanctions regimes has nothing to do with Iranian oil exports.

OIL-Oil steady ahead of OPEC meeting, Greek polls
LONDON, June 14 (Reuters) - Oil prices held just under $97, with investors and traders reluctant to add to positions ahead of a meeting  of oil producer group OPEC and Greek elections at the weekend.
"No one is expecting any fireworks," agreed Hansen. "Any disagreements tend to be kept behind closed doors and it will probably result in an unchanged ceiling this afternoon."    

Oil steady ahead of OPEC meeting, Greek polls
LONDON, June 14 (Reuters) - Oil prices held just under $97, with investors and traders reluctant to add to positions ahead of a meeting on Thursday of oil producer group OPEC and Greek elections at the weekend.
Traders are looking for any change in OPEC's output policy given that some view the market as over-supplied, while the Greek election result should deliver some clarity as to whether Greece will stay in the euro.  

Saudi under OPEC pressure to prevent oil collapse
VIENNA, June 13 (Reuters) - Saudi Arabia came under pressure on Wednesday from fellow OPEC producers to cut oil output to prevent a further slide in crude prices.  
Price hawks in the Organization of the Petroleum Exporting Countries are fretting that slowing economic growth will send crude, already off $30 since March, plummeting further.  

Sliding oil price rebalances Middle East economy
DUBAI, June 13 (Reuters) - Ziad Makhzoumi, chief financial officer of Arabtec , the United Arab Emirates' biggest construction firm by stock market value, thinks the region's economy will probably ride out weak oil prices comfortably. But he sees a risk.
If oil drops below the price at which energy-exporting countries in the Gulf can balance their state budgets - a scenario which he thinks unlikely - infrastructure and other building projects will slow down or in some cases halt.

Gold Traders Bullish as Hedge Funds Increase Wagers (Source: Bloomberg)
Gold traders are bullish for a fourth consecutive week after hedge funds added to bets that prices will rally, exchange-traded products backed by the metal expanded and Europe’s debt crisis roiled markets. Twenty-four analysts surveyed by Bloomberg said they expect gold to gain next week and six were bearish. A further three were neutral. Speculators boosted net-long positions by 27 percent in the week ended June 5, the latest Commodity Futures Trading Commission data show. ETP holdings rose 18 metric tons valued at $938 million since the start of June, halting a three- month retreat, according to data compiled by Bloomberg. Greek voters return to the polls June 17 after last month’s elections failed to produce a government, increasing concern the 17-nation euro would fracture. Almost $5.7 trillion was wiped off the value of global equities since the end of March on signs of slowing growth, spurring speculation that policymakers will do more to shore up economies.
Gold rose about 70 percent as the Federal Reserve bought $2.3 trillion of debt in two rounds of quantitative easing, or QE, ending in June 2011. “Whatever the outcome in Europe, it will likely be supportive for gold,” said Neil Gregson, who manages about $6.9 billion of natural-resources equities at JPMorgan Asset Management in London. “We’ve still got the possibility of QE3 in the U.S., which would be good for gold.”

No comments: