Tuesday, January 31, 2012

20120131 1815 FCPO EOD Daily Chart Study.

FCPO closed : 3078, changed : -4 points, volume : higher.
Bollinger band reading : little downside biased with possible pullback correction.
MACD Histrogram : falling, seller taking exposure.
Support : 3070, 3050, 3020, 2970 level.
Resistance : 3100, 3150, 3200, 3250 level.
Comment :
FCPO closed recorded tiny loss with rising volume participation. Soy oil price currently rebounding higher after overnight fall severely lower while crude oil price currently trading higher testing 100 resistance level.
Both ITS and SGS cargo surveyor reported improved but still declined month to month export data.
Daily chart reading remained suggesting a little downside biased market development 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.

20120131 1747 FKLI EOD Daily Chart Study.

FKLI closed : 1518, changed : +16 points, volume : lower.
Bollinger band reading : side way range bound.
MACD Histrogram : turned upward, buyer seller battling.
Support : 1505, 1500, 1494, 1485 level.
Resistance : 1515, 1530, 1540, 1550 level.
Comment :
FKLI closed rebounded higher after yesterday slump with lower volume changed hand with Feb 2012 contract doing 7.5 points discount compare to cash market that closed higher. Overnight U.S. market closed recorded  marginal loss and today Asia markets traded higher while European markets current trading little higher.
Most European leader agreed on fiscal policy. progress over Greece debt deal and increased in Japan industrial production resulted global markets to rebound higher.
Technical reading suggesting a side way range bound 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.

20120131 1717 Regional Markets EOD Daily Chart Study.

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

20120131 1655 Global Market & Commodities Related News.

Shares, euro recover on Greek debt hope, Portugal weighs
TOKYO, Jan 31 (Reuters) - Asian shares and the euro recovered earlier losses after Greek Prime Minister Lucas Papademos raised hopes for a deal to be reached this week to avoid a default, but markets were starting to worry that Portugal might need a second rescue.
"After the rally, most Asian assets are undergoing some kind of consolidation, but there is still hope for some kind of an  agreement reached and investors are delaying expectations about this talk," said Frances Cheung, senior strategist for Asia ex-Japan at Credit Agricole CIB in Hong Kong.

FOREX-Euro firms on Greek debt hopes; dollar at 3-mth low vs yen
SINGAPORE, Jan 31 (Reuters) - The euro rose on Tuesday, supported by hopes for a Greek debt restructuring deal that would help the country avoid a disorderly default, possibly setting itself up for a test of a key chart level.  
The dollar extended its recent losses versus the yen and hit a three-month low, remaining under pressure after the U.S. Federal Reserve said last week it was likely to keep interest rates near zero at least until late 2014.

Relief in US food prices seen as crop supplies grow
CHICAGO, Jan 30 (Reuters) - After being hammered by record high food prices in 2011, which helped ignite the Arab Spring uprisings, consumers worldwide may find some relief in 2012 if U.S. farmers, induced by last year's high crop prices, plant more fields to grain this year.
Analysts polled by Reuters expect prices of corn, soybeans and wheat to tumble as much as 15 percent from a year ago, which will benefit companies that produce meat like Pilgrim's Pride Corp , Sanderson Farms  and Tyson Foods Inc  in terms of lower feed costs.    

U.S. grains steady, nursing falls on Latam rains
SYDNEY, Jan 31 (Reuters) - U.S. grain futures were steady to firmer in early Asian trade, stabilising after heavy losses in the previous session when soy fell nearly 3 percent as the dollar gained on the euro zone debt crisis and on better-than-expected South American rainfall.  
Crop-friendly rainfall of 0.50 to 1.5 inches is expected this week through all areas of Argentina which will benefit the soy crop in its key pod-setting phase and CORN.

China ban on Indian meal to benefit Canadian canola
BEIJING, Jan 30 (Reuters) - China will boost imports of rapeseed and rapeseed meal from Canada, traders said on Monday, after Beijing banned Indian meal after tests showed it contained a toxic chemical.
If China buys more rapeseed, or canola, from Canada, the world's top exporter, it could firm ICE canola prices , which have been rising for the past two weeks in anticipation of larger imports.

Brazil to breathe life into faded Cuban sugar sector
SAO PAULO, Jan 30 (Reuters) - Brazilian builder Odebrecht plans to produce sugar in Cuba, the company said on Monday, as looser restrictions on foreign investment in the communist island raise hopes of a recovery in the once-booming sector after decades of decline.
News of the project came on the day Brazil's President Dilma Rousseff begins a mostly ceremonial official visit to the country, which has been under communist rule since the Fidel
Castro-led revolution and an ensuing U.S. trade embargo.

Brazil soy harvest to speedup as rains shift south
SAO PAULO, Jan 30 (Reuters) - The soybean harvest is due to pickup speed in the coming weeks in the early maturing center-west states of Brazil, the world's No. 2 producer of the oilseed, as rains shift to the parched south where moisture is still needed.
The center-west is forecast to harvest a near-record crop this season due to excellent rain over the past weeks. States in the region such as No. 1 soy grower Mato Grosso and No. 4 Goias, are typically earliest to plant and harvest in Brazil.

Argentine grains shipping normal after boat dislodged
BUENOS AIRES, Jan 30 (Reuters) - Port authorities in Argentina's Rosario grains hub have dislodged a vessel that ran aground earlier this month, and all delayed ships have been able to set sail, an industry official said on Monday.
Argentina is one of the world's top suppliers of corn, soybeans and byproducts, and most its grains are shipped from the constellation of terminals around the city of Rosario.  

ICCO pegs rise in global cocoa stocks
LONDON, Jan 30 (Reuters) - World cocoa stocks rose to 1.723 million tonnes as of Sept. 30 after bumper crops in West Africa helped produce a record surplus, according to the International Cocoa Organization's annual assessment.
Stocks were up by 295,000 tonnes on the year, with the majority held in importing countries, ICCO statistician Laurent Pipitone told Reuters.

OPEC says EU ban on Iran oil to boost prices
LONDON, Jan 30 (Reuters) - The EU's embargo on Iranian oil exports will add upward pressure to oil prices, OPEC's secretary general said on Monday, even though there is no shortage of oil on the market.
Abdullah al-Badri also said he was not concerned about too much oil in the market, even though the Organization of the Petroleum Exporting Countries is pumping about 600,000 barrels per day (bpd) more than its new target of 30 million bpd.

Brent rises above $111/bbl as supply trumps economy
SINGAPORE, Jan 31 (Reuters) - Brent crude inched above $111 a barrel, on track for its first rise in two months, as concerns over supply from Iran and South Sudan trumped worries about a global economic slowdown that could hit oil demand.
"Iran will make sure we see more upside than downside," Jeremy Friesen, a commodity strategist at Societe Generale said, although strong downside forces from the deteriorating economy capped gains.

London copper gains on outlook for long-term demand
KUALA LUMPUR, Jan 31 (Reuters) - London copper inched up, heading for its biggest gain in three months, on cautious optimism that demand for the industrial metal will rebound this year with Asian economies generally resilient in the face of global financial turmoil.
Asian economies remain "generally resilient" in the face of global financial turmoil and a growing debt crisis in the euro zone, the IMF's top official for Asia and the Pacific said on Monday.

Chile December copper output up but 2011 total output falls
SANTIAGO, Jan 30 (Reuters) - Chile's copper output jumped in December from the same month a year earlier but clocked a 3.2 percent drop in 2011 from a year earlier as falling ore grades, labor woes and weather problems hammered the world's top producer, the government said on Monday.
Chile, which provides around one-third of the world's copper, produced 509,407 tonnes of the red metal in December , up 2.2 percent from the same month of 2010, the government statistics agency INE said. Chile produced 5.24 million tonnes of the red metal in 2011, down 3.2 percent from the previous year, according to the INE.

Japan Dec zinc exports up 44 pct yr/yr on China
TOKYO, Jan 30 (Reuters) - Japan's exports of refined zinc surged 44 percent from a year earlier to 12,273 tonnes in December as exports to China more than doubled, customs-cleared data showed on Monday.  
Exports to China increased to 4,504 tonnes, up from 1,753 tonnes a year before, accounting for a third of Japan's total exports.

Italy's steel exports up, lag import volumes
MILAN, Jan 30 (Reuters) - Steel exports from Italy, the European Union's second-biggest producer after Germany, rose 12.5 percent year on year to 15.882 million tonnes in the first 11 months of 2011, but lagged behind import volumes, industry body Federacciai data showed on Monday.
Italy's export-focused steel industry has come under growing pressure from non-EU rivals in the past few years and, facing modest demand on core markets, needs to rethink its product range and consolidate, analysts say.

Silver coin sales hit record pace, outshine gold
NEW YORK, Jan 30 (Reuters) - Less than one year after silver's breathtaking collapse from its record-setting rally, investors are again snapping up coins at an unprecedented pace, suggesting the white metal could leave gold in the dust.
Even before the U.S. Federal Reserve's promise of further stimulus rejuvenated interest in precious metals last week, U.S. retail investors were already buying up freshly minted coins in droves, undaunted by last year's painful volatility. Gold coin sales, while rising, have been far less robust.

Gold edges up; heads for biggest monthly gain since Aug
SINGAPORE, Jan 31 (Reuters) - Gold ticked up after the euro recouped some losses, while bullion prices headed for their biggest monthly rise since August as lingering concerns about growth in the United States prompted buying from investors.  
"Sentiment seems to have improved quite tremendously, I would say. We are now into more bullish territory, more than ever, with the Fed providing enough fundamental support," said Dominic Schnider, head of commodity research at UBS Wealth Management.

METALS-London copper gains on outlook for long-term demand
KUALA LUMPUR, Jan 31 (Reuters) - London copper inched up on Tuesday, heading for its biggest gain in three months, on cautious optimism that demand for the industrial metal will rebound this year with Asian economies generally resilient in the face of global financial turmoil.
Three-month copper on the London Metal Exchange  climbed 0.22 percent to $8,447.75 a tonne by 0117 GMT, after its biggest decline in more than a week in the previous session.

PRECIOUS-Gold edges up; heads for biggest monthly gain since Aug
SINGAPORE, Jan 31 (Reuters) - Gold ticked up on Tuesday after the euro recouped some losses, while bullion prices headed for their biggest monthly rise since August as lingering concerns about growth in the United States prompted buying from investors.  
Gold jumped nearly 5 percent last week, its fourth consecutive weekly gain, after the U.S. Federal Reserve pledged to keep interest rates near zero until at least late 2014, which could put pressure on the dollar.

20120131 1050 Global Market & Commodities Related News.

GLOBAL MARKETS-Shares, euro capped by Greek deal, Portugal
TOKYO, Jan 31 (Reuters) - Asian shares and the euro struggled on Tuesday as stumbling talks on Greek debt restructuring reignited concerns over funding in other highly indebted countries, with markets starting to worry that Portugal might need a second bailout.
"Even if the Greece secures a Private Sector Initiative deal and meets its 14.5 billion euro payment on March 20, the fiscal and growth objectives of the austerity efforts in Athens and Rome have yet to be mulled by IMF monitors, not to mention the liquidity difficulties encountered by Portuguese sovereign bonds," he said.

Oil falls on euro zone worry, eyeing Iran
NEW YORK, Jan 30 (Reuters) - Oil prices fell on Monday  as stalled negotiations on a deal to restructure Greece's debt revived concerns about the economy while the risk that Iran might quickly halt crude exports to Europe limited losses.  
"Today's downdraft was largely explained by a renewed risk-off trade that saw both the euro and the equities slide," Jim Ritterbusch, president at Ritterbusch & Associates, said in a note.  

POLL-U.S. crude stocks seen up as imports rise
Jan 30 (Reuters) - U.S. crude oil inventories were expected to have risen last week for the second straight time due to a further recovery in imports, a preliminary Reuters poll of analysts showed on Monday.
Ahead of the weekly inventory reports, four of the six analysts polled expected a build in crude stockpiles for the week to Jan. 27, with the average forecast coming to 1.5 million barrels.

OPEC says EU ban on Iran oil to boost prices
LONDON, Jan 30 (Reuters) - The EU's embargo on Iranian oil exports will add upward pressure to oil prices, OPEC's secretary general said on Monday, even though there is no shortage of oil on the market.
Abdullah al-Badri also said he was not concerned about too much oil in the market, even though the Organization of the Petroleum Exporting Countries is pumping about 600,000 barrels per day (bpd) more than its new target of 30 million bpd.

China, Japan scramble for oil as Sudan shuts fields
SINGAPORE, Jan 30 (Reuters) - The shutdown in Sudanese oil supply could drive up already record premiums on spot crude markets as top Sudan customers China and Japan scramble for alternatives even as they weigh the impact on oil flows of international sanctions on Iran.
South Sudan has shut down its oil output, estimated at around 350,000 barrels per day (bpd), as it and neighbour Sudan row over how to disentangle their oil industries, borders and debt.

US natgas finishes lower on mild weather forecasts
NEW YORK, Jan 30 (Reuters) - U.S. natural gas futures reversed course and ended down slightly on Monday, as mild midweek weather forecasts offset some early follow-through buying and short covering after last week's strong gains.
"I think we saw a little short-covering after last week, but there's still a lot of doubt about how quickly producers will cut and how much of an impact that will have," said Steve Platt, analyst at Archer Financial in Chicago.

Euro Coal-Cold weather boosts coal, power, gas
LONDON, Jan 30 (Reuters) - Freezing weather across much of Europe boosted gas, coal and power futures prices on Monday while technical indicators suggest that the downtrend of the past few months may be over, utilities and traders said.
"It's all anticipation of what this cold weather could do to demand and prices across the markets, it's self-reinforcing," said Emmanuel Fages, analyst with Societe Generale in Paris.

COMMODITIES-Markets sink on dollar rally; soy, cocoa tumble
NEW YORK, Jan 30 (Reuters) - Most commodities closed lower on Monday as a strong dollar crushed raw materials priced in the currency, while crops such as soybeans and cocoa were further hurt by potential oversupplies and by demand concerns.
"It's difficult to see how this rally can continue," Jesper Dannesboe, a senior commodities strategist for Societe Generale, said, referring to copper.  

20120131 1006 Global Economic Related News.

With effect from 31 Jan 2012,  Bank Negara Malaysia (BNM) further  liberalised its foreign exchange rules, in a move to develop the domestic  financial markets. The liberalisation measures are:  Licensed onshore banks are permitted to trade foreign currency against  another foreign currency with a resident.  A licensed onshore bank is allowed to offer ringgit-denominated interest rate derivatives to a non-bank non-resident.  Flexibility is permitted for a resident to convert their existing ringgit or  foreign currency debt obligation into a debt obligation of another  foreign currency. (BNM)

Malaysia will remain the key destination for Singaporeans to spend their  holidays due to its close geographical proximity and cordial bilateral ties with the  country, said Tourism Malaysia director for Singapore, Zalizam Zakaria. In  2010, Malaysia received 24.6m tourists, who spent RM56.5bn. Of the total,  Singaporeans accounted for RM28.4bn, with 13m arrivals, he said. (Bernama)

Japan: Industrial production increases more than expected

Japan’s industrial production increased more than analysts forecast in Dec, as manufacturers bolstered production to make up for disruptions caused by Thailand’s worst floods in 70 years. Factory output rose 4% from Nov, when production slid because of supply disruptions, the trade ministry said in Tokyo. Manufacturers from Honda Motor to Toyota Motor are optimistic about demand as they recover from a year of natural disasters at home and in Thailand. The report indicates companies are resilient to the stronger currency and a slowing global economy. [Bloomberg]

China's Premier Wen Jiabao said government debt is at an "overall safe and  controllable" level, that funding for key projects would be ensured and that  applying the brakes to the economy would be done in a way to avoid systemic  risks. (Reuters)

Chinese banks extended a total of Rmb1.26tr (US$199.4bn) in new loans  to property developers and home buyers in 2011, down 38% from 2010, the  central bank said. (Reuters)

The International Monetary Fund is reviewing whether China's currency  should still be considered "substantially undervalued," in light of its rapid rise in  the past year. The IMF has called China's currency "substantially undervalued"  for the past half-decade. (WSJ)

The  People’s Bank of China  postponed the much-anticipated cut in  lenders’ reserve requirements, but instead injected Rmb353bn  (US$55.9bn) into the financial system using 14-day reverse-repurchase  contracts, the most since Bloomberg began collecting such data in 2008.  (Bloomberg)

The State Bank of India said the Indian government has agreed to inject up  to 79bn rupees (US$1.6bn) into it via preferential shares, but did not mention  when that would take place. The government currently owns 59.4% of SBI, but  is making this decision as rising bad loans and a surge in provisions weigh on  the bank's profitability, and have raised concerns on whether the lender has  sufficient capital. (WSJ)

South Korea: Output declines as Europe crisis saps demand
South Korea’s industrial production fell for a third month in December as Europe’s sovereign-debt crisis hurt exports and business confidence. Output declined 0.9% from Nov, when it dropped a revised 0.3%, Statistics Korea said. South Korea, which grew the least in two years in the fourth quarter, is facing increased uncertainty from Europe’s debt crisis, Finance Minister Bahk Jae Wan said. The Bank of Korea refrained from raising interest rates for a seventh month on 13 Jan to support growth amid faltering global expansion and signs of easing inflation. [Bloomberg]

S. Korean finance minister Bahk Jae-Wan called for early negotiations on  a free trade pact with China so Seoul can compete against Taiwan in the  lucrative Chinese market, saying that a sweeping China-Taiwan free trade  agreement signed last year will put South Korean firms, which compete against  Taiwanese firms in many sectors and most notably information technology, at  "a great disadvantage." (AFP)

The Philippines grew 3.7% yoy in 4Q (3.6% in 3Q). GDP growth increased  0.9% qoq (0.8% in 3Q). The median estimates were for a 3.8% yoy and 0.1% qoq.  For 2011, the Philippine economy expanded 3.7% compared with a 7.6% increase  in 2010, missing the government‟s official 12-month target of 4.5-5.5%.  (Bloomberg, Philippine Daily Inquirer)

Indonesia’s government clarified that the option of raising the subsidized  fuel oil price is still being discussed. Armida S Alisjahbana,  National  Development Planning Minister, said that the government is studying the  drafting of a more accurate subsidy policy. (Indonesia Finance Today)

Thailand  is looking to assist companies in the seven industrial estates inundated late last year by revising the terms of THB15bn in soft loans, with  two-thirds of the money given away and the rest offered as soft loans carrying  interest of 0.01% and a maximum 15-year repayment period. (Bangkok Post)

The Thai government  will work with the private sector on  forging a  four-year tourism strategy to restore confidence in Thailand and prepare the  country for the Asean Economic Community in 2015. (The Nation)

Thailand’s growth should stand at  -5% in 4Q11 and 1.1% for 2011, Fiscal  Policy Office director general Somchai Sujjapongse said. (Bangkok Post)

A poll by Bangkok University found that the  economic confidence  level in  Thailand stood at 28.41, pressured by uncertainties in exports, private  investment and tourism in the aftermath of floods. Outlook for the next three  and six months should increase, as the expectation confidence was 63.41 and  72.19, respectively. (The Nation)

EU: Sarkozy transaction tax may drive investors from French stocks
The French stock market, Europe’s second-biggest by value, may fall out of favor with investors after President Nicolas Sarkozy unveiled plans to unilaterally impose a 0.1% tax on financial transactions. Sarkozy, who faces elections in a two-round vote in Apr and May, wants to make good on a pledge he made to impose such a tax when France last year held the presidency of both the G-8 and G-20 group of countries. He said on 29 Jan that France will impose the levy starting in Aug in spite of opposition from banks. The tax will apply to share purchases, including high frequency trading, and credit default swap transactions. [Bloomberg]

EU: Stumbles on Greek plan as Merkel signals debt deal delay
European leaders sparred with Greece over a second rescue program, clouding progress toward a permanent aid fund and tougher budget rules designed to stabilize the Euro. Greece faced criticism that its economic makeover is faltering, and it fended off German-led calls for a European overseer to take command of its budget after its deficits surpassed targets for two years. Bargaining with Greece over a debt writedown and its economic management threatened to overshadow a summit meant to point the way out of the financial crisis by speeding the set-up of a full-time EUR500bn (USD654bn) rescue fund. [Bloomberg]

European leaders have agreed to back a fiscal discipline treaty,  whereby Euro zone countries would be legally bound to balance national  budgets over time.  The treaty aims to force Euro zone countries with high debt levels to bring  budget deficits down to 0.5% of GDP.  The treaty, which will be formally signed in Mar, is the first move in a  carefully orchestrated strategy to win back market confidence.  The treaty will come into force on 1 Jan 2013 provided 12 countries have  ratified it by then. The second step is likely to come in mid-Feb, when EU officials hope to  resolve the gap in Greece‟s budget. (FT)

The EU Summit is expected to announce up to €20bn (US$26.4bn) of unused  funds from the EU's 2007-2013 budget will be redirected toward job creation  and free up bank lending to small- and medium-sized companies. (Reuters)

A draft of the EU summit communiqué calls for "growth-friendly"  consolidation and job-friendly growth,‟‟ an indication that EU leaders have  come to realize that austerity measures, like those being put in countries like  Greece and Italy, risk stoking a recession and plunging fragile economies into a  downward spiral. (NY Times)

The European Commission's economic sentiment indicator rose by  0.6 pts to 93.4, the first improvement in sentiment since Mar 2011 as some  confidence returned to services, consumers and construction. (Reuters)

US: Consumer spending stalls as Americans lift savings
Consumer spending stalled in December as Americans took advantage of a jump in incomes to restore depleted savings, indicating households remain focused on repairing finances. Purchases were little changed after rising 0.1% the prior month, Commerce Department figures showed in Washington. The median estimate of 77 economists surveyed by Bloomberg News called for a 0.1% increase in sales. Incomes climbed by the most in almost a year, pushing the savings rate to a four-month high. [Bloomberg]

US: Treasury cuts quarterly borrowing estimate 18% to USD444bn
The US Treasury Department lowered its borrowing estimate for the current quarter by 18% to USD444bn, reflecting higher receipts and lower spending. The Treasury reduced its net borrowing estimate for January through March by USD97bn from a projection of USD541bn three months ago. US Treasury officials also see net borrowing of USD200bn in the second quarter. The estimates set the stage for the Treasury’s quarterly refunding announcement on 1 Feb. [Bloomberg]

The  US Architecture Billings Index held at 52 last month, a sign of  expansion. The commercial and industrial component, a proxy for private  building activity, climbed to 54.1 in Dec. (Bloomberg)

More than two-thirds of US banks in a Federal Reserve survey of senior loan  officers said they had tightened credit to European financial firms in Jan,  underscoring the continent's severe banking crisis. Domestic lending standards  were largely unchanged this month, while loan demand picked up somewhat.  (Reuters)

20120131 1006 Malaysia Corporate Related News.

Tenaga Nasional Bhd (TNB) CEO Datuk Seri Che Khalib Mohd Noh will be  calling it quits when his contract expires in June this year after heading the  national utility for the past seven years. “In any organisation, you need new faces,” he told StarBiz. “I am  recommending a new face  ... the organisation needs a fresh face. It is like  that in any organisation. If a person stays on for too long, people tend to get  bored with him.” The board has accepted Che Khalib's request for his contract not to be  renewed and has begun finding a replacement. “It is entirely up to the board to decide. It is getting consultants to identify  the candidates; the process started last month (when Che Khalib indicated  his request not to be renewed). “The priority would probably be internal candidates; naturally, the most  suitable person would be the current chief operating officer/executive  director Datuk Azman Mohd. But ultimately, it is up to the board whether it  is an internal or external candidate,” he said. (Star Biz)

DRB-HICOM Bhd is understood to have hosted two  Volkswagen AG  Group directors last Thursday. Business Times understands that the two met  key stakeholders of DRB-HICOM, including its top management.   “They also reviewed all Proton Holdings Bhd‟s models,” said a source. It is  understood that the Volkswagen directors were here to evaluate the  possibility of having a collaborative technical agreement on technology  transfer with Proton. “This is the first step and I think that there will be  many more such meetings before a deal could be struck,” said the source. (BT)

Malaysia is prepared to submit comments to the US Environmental Protection  Agency (EPA), criticising its recent actions which could lead to a trade war of  commodities. EPA analysis shows that biodiesel and renewable diesel produced  from palm oil from Malaysia and Indonesia do not meet the minimum 20%  lifecycle Greenhouse-gases reduction threshold needed to qualify  as renewable  fuel under the Renewable Fuel Standard (RFS) programme. (BT)

CIMB Group Holdings Bhd is optimistic new regulations under  consideration in Indonesia won't force it to dump its controlling stake in its  Indonesian banking subsidiary. The group's chief executive Nazir Razak said  CIMB is hoping it will be able to hold on to its 97% stake in Indonesia's  fifth-largest bank, CIMB Niaga. (WSJ)

Transparency International Malaysia (TI-M) has expressed concern over  the apparent lack of transparency and proper procedure in the awarding of the  RM7.07bn West Coast Expressway concession project.  Its president, Datuk Paul Low said this mega project would involve massive  public financing of a soft loan of RM2.24bn and payment of RM980m for  land acquisition, and an unprecedented 60-year toll concession. “TI-M  views with concern the apparent lack of transparency and proper procedure  in the award.  Given the public funding and long concession period, there could have been  proper governance and transparency in the  award through an open,  transparent and competitive procurement process and public disclosure of  the terms and conditions of the contract,” he said in a statement. (Financial  Daily)

AirAsia Bhd flew 29.86m passengers in 2011, up 16.27% from 25.68m the  previous year. The carrier carried 7.93m passengers, a 12.3% increase in 4QFY11.  Its capacity also rose 13.5% to 37.5m while load factor increased to 80%, up 2%. Reuters reported that Southeast Asian carriers are expected to cash in on  the increasing interest from both business and leisure travelers in Myanmar,  which in recent months has announced some democratic reforms. Thai  AirAsia is looking to add new routes into Mandalay and Bagan, Myanmar‟s  inland cultural centres. (Financial Daily)

Wah Seong is confident of securing at least RM1.5bn of its current tenderbook  of RM4.9bn, mostly in international oil and gas service projects. Managing  director Giancarlo Maccagno said based on its track record, the company has a  20%-30% success rate on tenders. The company‟s current order book stands at  RM1.3bn. Maccagno said the company is keen on merger & acquisition (M&A)  to grow the company and is always in the process of reviewing possible  opportunities. He said Wah Seong is currently in discussion with a potential  company for a M&A. (Malaysian Reserve)

Ekovest will soon add Duta-Ulu Kelang Expressway (Duke) into its books  under a RM325m share swap deal. Ekovest will issue 126.7m new shares at an  issue price of RM2.75 each in return for a 100% stake in Wira Kristal Sdn Bhd.  Wira Kristal owns 70% of Nuzen Corp Sdn Bhd, which has a 34-year concession  of Duke. The new Ekovest shares will be issued to Wira kristal owners Datuk Lim  Kang Hoo and Datuk Haris Onn Tun Hussein. Currently, the Duke is revenuegenerating and cash flow-positive, Ekovest said. (BT)

Bank Muamalat Malaysia Bhd will focus on increasing the number of  non-Muslim customers to enhance the market of various Islamic banking  products and services. Chairman Tan Sri Dr Mohd Munir Abdul Majid said that  presently, the percentage of non-Muslims using Bank Muamalat's services was  20% for the deposits segment and 40% for the financing segment. (Bernama)

Soon-to-be-listed  Sentoria Group Bhd is in talks with state-owned  investment fund  Permodalan Nasional Bhd (PNB) to develop an  integrated resort (IR) city in Morib, Selangor. Sentoria is the developer and  operator of the Bukit Gambang Resort City (BGRC) in Kuantan, Pahang. The  company is slated to be listed on the Main Market of Bursa Malaysia on Feb 23.  A source familiar with the matter said an agreement between Sentoria and  PNB is expected to be sealed soon. "The discussions are in an advanced  stage to develop recreational and supporting elements such as theme parks  and MICE (meeting, incentive, convention and exhibition) facilities there on  a joint venture (JV) basis. The project will involve developing at least 80ha  of land owned by PNB," the source told SunBiz.  "Under the JV, Sentoria will emulate the integrated property development  concept of BGRC and bring it to Morib." It is understood that the proposed  project is part of Morib Beach Resort, a 320ha development project of  which PNB Deve
lopment Sdn Bhd, a unit of PNB, is the master developer.  (Sun)

MASkargo Sdn Bhd, which received its third Airbus A330-200F yesterday, is  targeting RM2.4bn in revenue for the financial year ending Dec 31, 2012, driven  by increased trade in intra-Asian markets, said its acting CEO Mohd Yunus Idris.  For last year, MASkargo is expected to achieve a revenue of over RM2bn. "We  are still in the closing period and will be announcing our results for financial  year 2011 soon. We are expecting revenue to exceed RM2bn," he said, adding  that in 2010, MASkargo posted RM2.4bn in revenue. (Sun)

Datuk Goh Tian Chuan‟s special purpose vehicle Temasek Formation Bhd (TFB)  has received the Securities Commission‟s approval to merge Jotech Holdings  Bhd, and AIC Corporation Bhd and AutoV Corporation Bhd.  The proposed merger of the three companies for a total consideration of  about RM696m would be satisfied via the issuance of new Temasek  Formation shares. Goh, who is the group executive chairman of Jotech and  AIC, described the SC approval as “an important milestone for the three  PLCs and will leverage the groups plans to achieve greater heights”.  When completed, the merger would create a larger group in terms of market  capitalisation, streamline the multi-tiered shareholding structure and  unlock potential intrinsic values. “The full value of the business potential of  Jotech, AIC and AutoV is expected to be accurately reflected at TFB level,”  he said. (Financial Daily)

QSR Brands Bhd has acquired 1.6m units of Al-Aqar Healthcare REIT from  the open market for a total purchase consideration of RM1.9m. The purchase  was funded by internally-generated funds. Rationale for the purchase was the  opportunity for capital appreciation given Al-Aqar‟s future acquisition plans and  its stable income stream from tenants. (BMSB)

Malaysia and Singapore are combining efforts and resources in a  strategic  entertainment and media industry alliance  to penetrate the global  market. To jumpstart the initiative,  Singapore's Media Development  Authority (MDA) will be leading 33 entertainment and media companies to  Kuala Lumpur from Jan 30 to Feb 1, and they will be hosted and facilitated by  Malaysia’s National Film Development Corporation (FINAS). In a  statement, Global Creative and Media Agency (GCMA) said FINAS and MDA  have been in talks towards concretising a co-production agreement since  October last year. (BT)

IJM Corp to raise stake in KEuro
The potentially huge contracts spin-off from the RM7.07bn West Coast Expressway (WCE) project has spearheaded IJM Corp into the spotlight. But not to be forgotten is Kumpulan Europlus (KEuro), which could see more corporate exercises. “For a bigger exposure to the WCE concession, IJM Corp is likely to increase its stake in KEuro, which is now only 22.7%. It may not want to privatise KEuro, but certainly it may want to have a bigger shareholding in the company,” said a market observer. (Financial Daily)

New management team for Proton likely following takeover
Speculation over the future of the top management at Proton Holdings has surfaced with reports indicating that DRB-Hicom is keen to get its own people in the top posts of the national carmaker. News reports quoting sources said DRB-Hicom was keen to reshuffle Proton's management in the next two to three weeks. Current Proton chairman Datuk Seri Mohd Nadzmi Mohd Salleh and managing director Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir are said to be on top of the list of those to be replaced. (StarBiz)

MAHB plans share placement to raise RM598.4m
Malaysia Airports Holdings (MAHB) plans to raise RM598.40m from a proposed share placement to finance the new low cost carrier terminal at Kuala Lumpur International Airport (KLIA2). MAHB said it planned to issue 110m new shares, which was up to 10% of its issued and paid-up share capital, to investors to be identified via a book building exercise. RM590m would be used to part finance the additional capex for KLIA2 while the remaining RM8.4m would be used to defray expenses relating to the proposed private placement. (Financial Daily) Please see accompanying report

SC committee shot down general offer for E&O
SC task force and its senior management had recommended that Sime Darby triggered the mandatory offer obligation for the remaining shares in E&O, but the recommendation was not agreed upon by the takeovers and mergers committee. The task force recommended that a new party acting in concert be formed between Sime Darby’s wholly-owned Sime Darby Nominees SB (SDN) and Datuk Terry Tham. Both collectively held more than 33% of the voting shares in E&O. (Financial Daily)

USD330m BDSN loan boosts Maybank's reach
The Maybank Group has concluded the syndication of a USD330.6m (RM1bn) term facility for Indonesia's PT Bajradaya Sentranusa (BDSN). The 10-year facility is segregated into dual-currency conventional tranches of USD187.5m (RM570m) and IDR400bn (RM126m) as well as USD100m (RM304m) in an Islamic tranche. Proceeds will be used to take over the entire existing project loans for the construction of the 2x90 megawatt Asahan 1 Hydroelectric Power Plant (Asahan 1 Hydroplant) located in North Sumatra, Indonesia, said Maybank in a statement. (BT)

20120131 1002 Global Market Related News.

Asian Stocks Swing Between Gains, Losses on Europe, Japan Production Data (Source: Bloomberg)
Asian stocks swung between gains and losses as European leaders failed to complete a Greek rescue program, U.S. consumer spending stalled and Japan’s industrial production grew faster than estimated last month. Canon Inc., the world’s biggest camera maker, sank 4.5 percent after its president resigned amid forecasts for slowing net income growth to miss estimates. Daewoo Shipbuilding & Marine Engineering Co., a South Korean shipbuilder, gained 4.2 percent after winning a $556 million contract to supply tankers to Kuwait Oil Tanker Co. The MSCI Asia Pacific Index (MXAP) added 0.2 percent to 122.39 as of 9:41 a.m. in Tokyo, having swung between gains and losses at least eight times. The measure has risen the past six weeks, the longest streak since a seven-week stretch that ended Oct. 15, 2010, amid bets China will ease lending curb, the U.S. economy is improving and Europe is containing its debts crisis.

Japanese Stocks Snap Three-Day Drop as Greece Makes Progress in Debt Talks (Source: Bloomberg)
Japanese stocks rose, snapping a three-day losing streak, after Greece’s Prime Minister said major progress had been made in debt talks with bondholders. Mazda Motor Corp. (7261), a carmaker that gets almost a fifth of its sales from Europe, climbed 1.6 percent. Advantest Corp. (6857), the world’s biggest maker of memory-chip testers, jumped 5 percent after Daiwa Securities Group Inc. raised the stock’s rating. Fanuc Corp. (6954), Japan’s top manufacturer of factory robots, rose 1.4 percent after the nation’s industrial production increased more than expected. The Nikkei 225 Stock Average rose 0.3 percent to 8,820.29 as of 10:07 a.m. in Tokyo. The broader Topix Index added 0.1 percent to 757.80, after falling as much as 0.3 percent earlier as European leaders yesterday struggled to complete a Greek rescue package.

U.S. Stocks Decline Amid Concern About Greek Debt Negotiations (Source: Bloomberg)
U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for a third day, as European leaders sparred with Greece over a second rescue program. Equities pared declines as some of the biggest technology companies rallied. Apple Inc. (AAPL) and Microsoft Corp. (MSFT) added at least 1.2 percent. Bank of America Corp. (BAC) fell 3 percent after Goldman Sachs Group Inc. cut its recommendation. Halliburton Co. (HAL) and Chesapeake Energy Corp. dropped more than 1.1 percent as oil slumped. Gannett Co. (GCI), the owner of 82 newspapers including USA Today, tumbled 6.9 percent as its profit plunged 33 percent. The S&P 500 decreased 0.3 percent to 1,313.01 at 4 p.m. New York time. The benchmark index for American equities trimmed a decline of as much as 1.2 percent. The Dow Jones Industrial Average retreated 6.74 points, or 0.1 percent, to 12,653.72.

European Stocks Fall Most in Six Weeks; BNP Paribas Tumbles on French Tax (Source: Bloomberg)
European stocks dropped the most in six weeks as Portuguese bonds sank amid concern a meeting of the region’s leaders will fail to draw a line under the sovereign- debt crisis. BNP Paribas SA (BNP) tumbled 7.1 percent, leading French banks lower, as President Nicolas Sarkozy said he will unilaterally impose a financial-transaction tax. Royal Philips Electronics NV (PHIA) fell 2.2 percent after reporting a larger-than-estimated loss. Hochtief AG (HOT) slid 5.8 percent after saying it will post a wider annual loss than previously anticipated. The Stoxx Europe 600 Index retreated 1.1 percent to 252.52 at the close of trading, the largest slide since Dec. 14. The benchmark gauge has still rallied 18 percent from its Sept. 22 low as the U.S. economy maintained its recovery and speculation grew that the euro area will contain the sovereign-debt crisis.

U.S. Lowers First-Quarter Borrowing Estimate (Source: Bloomberg)
The U.S. Treasury Department lowered its borrowing estimate for the current quarter by 18 percent to $444 billion, reflecting higher receipts and lower spending. The Treasury reduced its net borrowing estimate for January through March by $97 billion from a projection of $541 billion three months ago. U.S. Treasury officials also see net borrowing of $200 billion in the second quarter. The estimates set the stage for the Treasury’s quarterly refunding announcement on Feb. 1. An accelerating economy is boosting tax revenue, helping the administration of President Barack Obama control a budget deficit it forecasts will narrow to $956 billion this fiscal year. Gross domestic product expanded at a 2.8 percent annual pace in the fourth quarter of last year, the most since the second quarter of 2010.

U.S. Consumer Spending Stalls as Savings Rise (Source: Bloomberg)
Consumer spending stalled in December as Americans took advantage of a jump in incomes to restore depleted savings, indicating households remain focused on repairing finances. Purchases were little changed after rising 0.1 percent the prior month, Commerce Department figures showed today in Washington. The median estimate of 77 economists surveyed by Bloomberg News called for a 0.1 percent increase in sales. Incomes climbed by the most in almost a year, pushing the savings rate to a four-month high. The data illustrate the importance of sustained gains in jobs and wages to ensuring the growth of household purchases, the biggest part of the economy. The weak end to the quarter makes it more likely that consumer spending will cool early this year, underscoring the Federal Reserve’s decision to leave interest rates low until 2014.

Longest S&P 500 Valuation Slump Since Nixon Discounts Profit (Source: Bloomberg)
Valuations for U.S. equities have been stuck below the five-decade average for the longest period since Richard Nixon’s presidency, a sign investors don’t trust earnings even after a three-year bull market. Analysts estimate profits in the Standard & Poor’s 500 Index will reach a record $104.78 this year after increasing 125 percent since the end of 2009, the fastest expansion in a quarter century, according to data compiled by Bloomberg. American companies are boosting income so much that even after stocks doubled, the S&P 500 hasn’t traded above its 16.4 mean ratio for 446 days, the longest stretch since the 13 years beginning in 1973.
Battered by the 14 percent decline in the S&P 500 since 2000, the worst financial crisis since the Great Depression and the so-called flash crash 21 months ago, investors are staying away from stocks, even after record profits, 10 quarters of U.S. economic growth and promises by the Federal Reserve to keep interest rates near zero through 2014. Of the $37 trillion erased from global equities in the credit crisis, $24 trillion has been restored.

Fed Says Business-Loan Demand Climbed Last Quarter as Economy Accelerated (Source: Bloomberg)
Demand for business loans increased in the fourth quarter as economic growth accelerated, according to a Federal Reserve survey of senior loan officers at banks. Seventeen of 56 banks reported stronger demand among companies with $50 million in annual sales or more, according to the survey released today in Washington, while six reported weaker demand. Demand among small businesses for loans increased by the most in any quarter since 2005. Economic growth accelerated last quarter to a 2.8 percent annual rate, the fastest pace since the second quarter of 2010. The expansion still isn’t strong enough to push down an unemployment rate that has been at 8.5 percent or higher for 34 consecutive months, prompting the Fed last week to say its benchmark interest rate will be kept near zero until at least the end of 2014.

WTO Rejects Chinese Appeal of Ruling Against Mineral Curbs (Source: Bloomberg)
World Trade Organization judges rejected China’s appeal of a ruling that found restrictions on exports of nine raw materials break global rules and give the country’s manufacturers an unfair edge over competitors. The WTO concluded on July 5 that Chinese quotas, export duties and license requirements on overseas shipments of industrial ingredients including coke, zinc and bauxite are discriminatory. The restrictions have stoked tensions between China and its trading partners, which accuse the Chinese government of having unfair commerce and currency policies. U.S. Trade Representative Ron Kirk called the Appellate Body report a “tremendous victory,” particularly for manufacturers and workers. The decision “ensures that core manufacturing industries in this country can get the materials they need to produce and compete on a level playing field,” Kirk said in an e-mailed statement from Washington.

South Korea’s Industrial Output Declines as Europe’s Crisis Saps Demand (Source: Bloomberg)
South Korea’s industrial production fell for a third month in December as Europe’s sovereign-debt crisis hurt exports and business confidence. Output (KOIPIMOM) declined 0.9 percent from November, when it dropped a revised 0.3 percent, Statistics Korea said today, missing all 11 economist forecasts in a Bloomberg News survey. The median estimate was a 1.1 percent gain. Production rose 2.8 percent from a year ago after gaining a revised 5.8 percent in November, compared with a 4.1 percent rise estimated by economists. South Korea, which grew the least in two years in the fourth quarter, is facing increased uncertainty from Europe’s debt crisis, Finance Minister Bahk Jae Wan said yesterday. The Bank of Korea refrained from raising interest rates for a seventh month on Jan. 13 to support growth amid faltering global expansion and signs of easing inflation.

Japan Jobless Rate Rises on Strong Yen (Source: Bloomberg)
Japan’s unemployment rate unexpectedly rose last month as the strong yen continues to squeeze manufacturers. The jobless rate was 4.6 percent in December, the statistics bureau said in Tokyo today. The median forecast of 30 economists surveyed by Bloomberg News was for the rate to remain at 4.5 percent. The government has approved four supplementary budgets worth about 20 trillion yen ($262 billion) to stoke demand and rebuild after the March 11 earthquake and tsunami. Those funds are helping support the labor market, offsetting planned job reductions at manufacturers including NEC Corp. (6701)
“Labor offers in the devastated areas have been quite strong, and this will continue to support the labor market.” Kiichi Murashima, chief economist at Citigroup Global Markets Japan Inc. in Tokyo, said before the report. “Manufacturers have become cautious about hiring people in the context of global growth, the yen’s appreciation and uncertainty surrounding electricity supply” stemming from the shutdown of nuclear reactors since the disaster, he said.

Japan Industrial Output Increases Most in 7 Months (Source: Bloomberg)
Japan’s industrial output increased the most in seven months in December as manufacturers made up for disruptions caused by Thailand’s worst floods in 70 years. Factory production rose 4 percent from November, when production slid because of supply disruptions, the trade ministry said in Tokyo today. The median estimate of 30 economists surveyed by Bloomberg News was for a 3 percent gain. Manufacturers from Honda Motor Co. to Toyota Motor Corp. are optimistic about demand as they recover from a year of natural disasters at home and in Thailand. A stronger currency and a slowing global economy weighed down by Europe’s fiscal woes are risks for growth in Japan.

Confidence in Euro Area Increases at Slower Pace Than Estimated: Economy (Source: Bloomberg)
Euro-area confidence in the economic outlook improved less than forecast in January as the region’s leaders struggled to stamp out a two-year-old financial crisis and revive growth. An index of executive and consumer sentiment in the 17- nation euro area rose to 93.4 from a revised 92.8 in December, the European Commission in Brussels said today. That’s the first increase since February 2011, though it’s less than the median prediction of 93.8 in a Bloomberg survey of 30 economists. European Union leaders convene for their first summit of 2012 in Brussels today as a deteriorating economy and the struggle to complete a Greek debt swap risk undermining their crisis-fighting efforts. European Central Bank (EURR002W) President Mario Draghi said on Jan. 19 that 2012 will be a “much better” year for the single-currency area, though the International Monetary Fund forecast a recession.

Sarkozy Transaction Tax May Drive Investors Away From French Stock Market (Source: Bloomberg)
The French stock market, Europe’s second-biggest by value, may fall out of favor with investors after President Nicolas Sarkozy unveiled plans to unilaterally impose a 0.1 percent tax on financial transactions. “Even if the tax isn’t high, market participants who have a choice of stocks trading in Paris or elsewhere will go elsewhere,” said Yves Maillot, the Paris-based head of investments at Robeco Gestions SA, which oversees $6.8 billion. “That’s what we can fear.” Sarkozy, 57, who faces elections in a two-round vote in April and May, wants to make good on a pledge he made to impose such a tax when France last year held the presidency of both the G-8 and G-20 group of countries. He said Jan. 29 that France will impose the levy starting in August in spite of opposition from banks. The tax will apply to share purchases, including high frequency trading, and credit default swap transactions.

Euro-Area Debt Sales Top $43 Billion in Week as Fitch Threatens Sentiment (Source: Bloomberg)
European nations including Italy, Belgium and Spain may sell more than 33 billion euros ($43.3 billion) of securities this week as credit-rating cuts risk upending optimism the region’s debt crisis is being contained. Italy sold 5.574 billion euros out of a target of 6 billion euros of five- and 10-year debt today, and issued 1.9 billion euros out of a maximum goal of 2 billion euros of securities due in April 2016 and March 2021. Belgium sells as much as 3 billion euros of bills tomorrow, with Spain, Portugal, Germany and France issuing 13 different maturities in the five days.
While Italian and Spanish 10-year yields have fallen more than 1 percentage point from November highs as the European Central Bank offered banks unlimited three-year loans and Greek debt-swap talks pressed on, Fitch Ratings joined Standard & Poor’s this month in downgrading the nations’ credit. European Union leaders are meeting today in Brussels in a bid to wrap up a deficit-control treaty aimed at stemming the crisis, now in its third year.

Merkel Signals Greece Debt Deal Delay (Source: Bloomberg)
European leaders sparred with Greece over a second rescue program, clouding progress toward a permanent aid fund and tougher budget rules designed to stabilize the euro. Greece faced criticism that its economic makeover is faltering, and it fended off German-led calls for a European overseer to take command of its budget after its deficits surpassed targets for two years. “What the Greeks have to do is show they are ready to implement the package,” Dutch Prime Minister Mark Rutte told reporters as he arrived for a European Union summit in Brussels today. “We can help Greece through this difficult phase, but then Greece has to execute all agreements they made with us.”

EU Nears Confrontation Over Greek Rescue (Source: Bloomberg)
European governments moved toward a confrontation over a second rescue package for Greece, just as a dimming fiscal outlook in Portugal opened a new front in the debt crisis. Euro leaders left a Brussels summit late yesterday with no accord over how to plug Greece’s widening budget hole and German Chancellor Angela Merkel voicing frustration with the Athens government’s failure to carry out an economic makeover. “Greece’s debt sustainability is especially bad,” Merkel told reporters. “You have to find a way through more action by the Greek government, more contributions by private creditors, for example, in order to close this gap.”

20120131 1001 Global Commodities Related News.

Australia Selling the Farm as Prices Lure Global Funds (Source: Bloomberg)
Winston Heywood ended a 200-year family history when he sold his parched wheat fields to a fund managed by U.S. investor Westchester Group Investment Management Inc. for more than A$6 million ($6.4 million). “They offered me the money I could live off for the rest of my life,” said the 62-year-old, who in August left for the New South Wales coastal town of Coffs Harbour after enduring his driest season since 2000. “My kids didn’t want to go through the ups and downs I went through.” At least four other funds are seeking A$1.6 billion to buy similar assets in Australia, lured by fresh rain, the prospect of bumper crops, and land prices that have dropped 20 percent nationwide, and in some areas have fallen by half, since the end of 2007. Now, three years after billionaire James Packer sold off cattle ranches larger than the Netherlands, rural land prices may have bottomed, according to Colliers International.

Corn (Source: CME)
US corn futures retreat, ending lower on profit-taking and outside macro pressures. The market was primed for a pullback after sharp gains last week, traders say, and a stronger dollar--along with weaker equities thanks to Europe's debt crisis--sent buyers to the sidelines Monday. Analysts add that cash-market prices, which propelled futures last week, have since weakened, with Gulf basis sliding sharply. Traders also note there were beneficial South America rains over the weekend, though that is more of help for soy than corn at this stage of the growing season. CBOT March corn ends down 10c at $6.31 3/4 per bushel.

Wheat (Source: CME)
US wheat futures decline on pressure from corn and macroeconomic markets. Wheat was the strongest market in the grains complex but succumbed to outside pressure as corn sank and commodities generally fell amid a stronger dollar and European worries. Still, traders are nervous about a cold snap in Europe that could threaten wheat crops there, although it will be weeks before any damage is confirmed. Analysts add that speculative funds' large net-short position in wheat leaves it open to short-covering rallies. CBOT March wheat ends down 2 1/2c at $6.44 3/4 a bushel, KCBT March fell 2 1/2c to $6.97 and MGEX March declined 7 1/4c to $8.19.

Rice (Source: CME)
U.S. rice futures end lower on outside market pressure and weak demand. Worries about Europe's debt crisis drove the dollar higher and equities lower, weighing on commodities generally. Rice is suffering from weak demand, both domestically and internationally, but remains in a range established Jan. 12. CBOT March rice ends down 18c to $14.45 1/2 per hundredweight.

U.S. wheat firm on output concerns; corn, soy dip
NEW DELHI, Jan 30 (Reuters) - Chicago wheat futures were a touch higher, driven by  concerns over output in the Black Sea region and talk that Russia, which has emerged as a major global supplier of the grain, may curb exports to bolster domestic supplies.
"Yes, there has been some speculation about Russia applying brakes on wheat exports, but the market will have to wait for some clear signal," said Lynette Tan, analyst with Phillip Futures in Singapore.

Vietnam Q1 rice exports seen down 39 pct y/y -newspaper
HANOI, Jan 30 (Reuters) - Vietnam's rice exports in the first quarter of 2012 are expected to fall 39 percent from a year ago to around 1.1 million tonnes due to fierce competition from Indian and other Asian grains in its major markets, a state-run newspaper said on Monday.
Exporters of 25 percent broken grain have been losing market share in Africa to India, Myanmar and Pakistan, the Vietnam Economic Times quoted Truong Thanh Phong, chairman of the Vietnam Food Association (VFA), as saying.

Extreme heat hurts wheat yields as world warms-study
SINGAPORE, Jan 30 (Reuters) - Extreme heat can cause wheat crops to age faster and reduce yields, a U.S.-led study shows, underscoring the challenge of feeding a rapidly growing population as the world warms.
Scientists and farmers have long known that high heat can hurt some crops and the Stanford University-led study, released on Monday, revealed how the damage is done by tracking rates of wheat ageing, or senescence.

Myanmar to sell Indonesia 200,000 tonnes rice a year
YANGON, Jan 28 (Reuters) - Myanmar will sell Indonesia about 200,000 tonnes of rice a year under an agreement signed on Saturday with Indonesia's state procurement agency, Bulog, Myanmar industry officials said.  
Bulog imported 1.9 million tonnes of rice last year from Thailand, Vietnam and India but said on Jan. 5 it wanted to avoid imports this year. Indonesia aims to be self-sufficient, as it was in the early 1980s.

Argentina says rain came too late for some corn
BUENOS AIRES, Jan 27 (Reuters) - The dryness that blighted Argentine farm areas in December and early January will cut yields of early-planted corn while later-seeded fields have been revived by recent rains, the government said on Friday.
A scorching Southern Hemisphere summer sun has dried up hope that Argentina might replenish global corn supplies after a lacklustre U.S. harvest. The South American country is the No. 2 exporter of corn and the No. 3 supplier of soybeans, which serve as a major source of protein for the world.

Ohio ethanol makers reject vomitoxin corn
CHICAGO, Jan 27 (Reuters) - Ohio ethanol makers have rejected corn from that state containing vomitoxin, the byproduct of a fungal disease usually found in wheat, and corn prices rose further on the hot U.S. cash market, merchants and farmers said.
Vomitoxin, which sickens livestock if consumed in large amounts, thrived under cool, wet weather this past autumn in Ohio.    

EU wheat now competitive for export -Toepfer
HAMBURG, Jan 27 (Reuters) - European Union milling wheat is now competitively priced in global export markets and is likely to gain sales as rival Black Sea supplies become tighter, Germany's largest grain trading house Toepfer International said on Friday.
"(EU) milling wheat has become competitive internationally and in January export sales were made to Algeria, Tunisia and Egypt," Toepfer said in a market report.

Rains lift Brazil's cane crop, sunny days ahead
SAO PAULO, Jan 27 (Reuters) - Rains in Brazil's main center-south cane region are helping the development of plants; sunny and dry weather was forecast for the next 10 days, meteorologists Somar said Friday.  
Brazil is the world's largest sugar exporter, and the center-south accounts for around 90 percent of the national cane crop.

Rain Boosts Argentina's Parched Fields, But Much More Needed (Source: CME)
Argentina's parched fields got a moderate soaking from showers across much of the farm belt over the weekend, but much more is needed to replenish depleted soil moisture levels and fuel a recovery of the developing soy crop. "It helped, but didn't reverse the dryness," said agricultural weather specialist Tomas Parenti of the Rosario Grain Exchange. More showers are hoped for Monday night and Tuesday, and farmers will be watching closely for sufficient rain to boost water reserves enough to get the crops through the summer season, Parenti said. As of midday Monday, up to 25 millimeters of rain had fallen across the southern areas of the central farm belt, according to the exchange's climate report, known as the GEA. Argentina is the world's second-largest corn exporter, leads soyoil and soymeal exports and ranks third in global soybean exports. Global grain traders have been watching weather conditions in both Argentina and Brazil closely for signs of a break in the drought, which would stem crop losses.
However, the corn crop has already suffered major losses with potential production down by over a quarter. Early in the season, many had expected production to top 30 million tons. Now, the Rosario exchange is predicting corn output of just 21.4 metric tons. "This is going to be an average-to-bad season for corn," Parenti said. While there is still time for the soybean crop to rebound, some yield losses are irreversible and many fields have low soybean pod counts, he added. Analysts are predicting 2011-12 soybean production of between 45 million and 49.5 million tons--well short of the record 54.5 million tons harvested in the 2009-10 season. While recent showers are a boon, below-average rainfall is expected to continue in the coming months due to the La Nina weather phenomenon. La Nina involves the periodic cooling of the equatorial Pacific Ocean that usually brings dry weather to the farm belts of Argentina, Uruguay, Paraguay and the south of Brazil.
La Nina is expected to fade in March or April, but its effects will linger through the southern hemisphere winter with dryness continuing until October or November, according to Eduardo Sierra, chief climatologist for the Buenos Aires Cereals Exchange.

Thailand May Lose World's Top Rice Exporter Title; Over 40% Fall Likely In 2012 (Source: CME)
Thai rice exports could fall by more than 40% to multiyear lows, on the back of uncompetitive prices and government buying above market rates, a top industry official said Monday, potentially putting Thailand below Vietnam and India as the world's top exporter of rice. Thai rice exports reached a record 10.6 million metric tons in 2011, but are likely to fall to 6 million tons this year, Korbsook Iamsuri, president of the Thai Rice Exporters' Association told Dow Jones Newswires in an interview. Korbsook said that in recent months, Thailand has lost most of its share in global trade of parboiled grades to India, whose offers are cheaper by up to $100/ton. India resumed exporting non-Basmati rice in September after a gap of more than three years when they were banned to curb domestic inflation. Before India lifted its ban on exports, Thailand was exporting up to 400,000 tons of parboiled rice each month but shipments are now less than 100,000 tons, Korbsook said.
She said Thailand's exports of white raw rice,  too, have slowed because of a lack of supply. Thailand lost close to 20% of the main rice crop that was harvested between October and December due to last year's floods while another 25% of its harvest last year was procured by the government to boost growers' earnings. The next harvest will only begin at the end of March, Korbsook said, and government procurement may be even higher because of rise in output and localized surpluses. The fall in exports is likely even as Thailand is set to reap a bumper crop of almost 8 million tons of unmilled rice in the secondary harvest, up from the usual 5 million-6 million tons. Close to 5 million tons may be procured by the government this year, she said. The bulk of the secondary harvest is in central Thailand, where farmers produce large surpluses, whereas production in northeast is dominated by small growers who cultivate mostly for self consumption, Korbsook said.
One consequence of government procurement is that the stockpile of rice will rise sharply at the expense of exports to more than 8.5 million tons. This is equivalent to exports of over eight months. She said the government already has 1.5 million tons rice in milled terms from previous years, has procured 3.5 million tons from the latest harvest and likely to buy a similar volume from the next harvest. The Thai government's policy of disposing of its stockpile isn't clear but exports may be higher than expected if the government sells to other governments overseas, Korbsook said.

Croatia Wheat 12-13 Production Forecast At 832,000 Tons - USDA (Source: CME)
Croatia's wheat production during the 2012-13 crop year will likely hit 832,000 metric tons, leaving the country with around 280,000 tons of grain for export, according to the U..S Department of Agriculture's Zagreb attache. Croatia's 2012-13 corn production is forecast to hit 2 million metric tons, creating a surplus of around 300,000 tons for potential exports, the attache said. Croatian barley production in 2012-13 is forecast at 190,000 metric tons, which won't meet domestic demand needs, so imports of around 30,000 metric tons are expected, the USDA said.

Sucden sees Brazil cane output modest recovery in 2012/13
LONDON, Jan 30 (Reuters) - Trade house Sucden Brazil anticipates a modest recovery in sugarcane production in centre-south Brazil to around 520 million tonnes in 2012/13.
Jeremy Austin, director of Sucden Brazil, said aging cane plants would make it hard for farmers to boost production, and that it could take some three years to bring down the average age of the cane to more reasonable levels.

ICE extends raw sugar trading hours, eyes Asia
SINGAPORE/NEW YORK, Jan 26 (Reuters) - Extended trading hours for New York sugar futures will offer Asian consumers a chance to hedge on the exchange which sets the tone for global prices, but liquidity may take some time to pick up.  
China's interest also remains to be seen, with the expansion of the trading hours at the ICE FUTURES U.S.  from next week designed to overlap with the end of trading in the Zhengzhou Commodity Exchange  by 30 minutes.

BASF sees crop science expansion in move to U.S.
Jan 27 (Reuters) - German chemical company BASF  is honing in on the Americas in the profitable biotech crop arena and giving up on the European market, where it has been frustrated by opposition to crops with genetically modified organisms, a top executive said on Friday.
BASF, one of the world's largest chemical companies, said last week it was transferring the headquarters of BASF Plant Science from Limburgerhof in Germany, to Raleigh, North Carolina. Development and commercialization of all products targeted solely at cultivation in the European market will be halted, the company said.

Brazil to sell 2009 arabica coffee stocks
BRASILIA, Jan 27 (Reuters) - Brazil will start selling arabica coffee stocks it bought to bolster prices in 2009, the agriculture ministry's coffee director told Reuters on Friday, with coffee prices now roughly $1 higher than when the stocks were first acquired.
The 1.4 million 60-kg bags of arabica (84,000 tonnes) should begin to be sold from February now that almost all the older public coffee stocks, some more than 30 years old, have been almost completely sold off, Edilson Alcantara said.

Coal-Carrier Rates Seen Dropping to Decade-Low on Capacity Glut: Freight (Source: Bloomberg)
The greatest number of coal cargoes in history still won’t be enough to eliminate a glut of Panamax vessels, driving charter rates to the lowest in a decade. Shipments will rise 3.6 percent to 956 million metric tons this year, according to London-based Clarkson Plc, the world’s biggest shipbroker. Rates for Panamaxes, each about 750-feet long, will average $12,744 a day in 2012, the lowest since 2002, the median of 10 analyst estimates compiled by Bloomberg shows. While that implies losses for ship owners, investors may profit by buying forward freight agreements, traded by brokers and used to bet on future costs, which anticipate $10,107.
Panamax charter costs already tumbled 53 percent since Jan. 1, the worst start to a year since at least 1999, as the fleet expanded for a 35th consecutive month. The slump is masking growth in economic activity, with Clarkson predicting record cargoes of everything from iron ore to oil to manufactured goods. The International Monetary Fund expects a third consecutive annual gain in world trade as economies recover from the worst global recession since World War II.

Euro Coal-Prices tick higher with oil, power
LONDON, Jan 27 (Reuters) - A rise in oil, European power values and tight prompt supply of South African coal pushed coal swaps and physical prices higher by around 50 cents to $1.00 U.S. a tonne on Friday.
But prices could start to sag again and dip towards $100 if China stays out of the spot market for another few weeks after the end of the Lunar New Year holidays, traders and utilities said.

Oil Increases as Much as 0.5% in New York to $99.28 on Economic Reports (Source: Bloomberg)
Oil rose in New York, gaining as much as 0.5 percent, on signs of better-than-expected increases in Japanese industrial production during December. Crude for March delivery climbed 50 cents to $99.28 a barrel in electronic trading on the New York Mercantile Exchange. It was at $99.26 at 8:48 a.m. Singapore time.

Oil dips below $111, EU and Iran eyed
LONDON, Jan 30 (Reuters) - Oil prices retreated, dipping below $111 a barrel after an expected Iranian vote to suspend crude exports to Europe was postponed and markets continued to wait for a deal on Greek debt.
"The newsflow regarding Iran will continue to drive prices. If there are further comments about stopping oil exports to Europe, prices will rise, but I rather doubt this will happen. It is just jawboning," said Carsten Fritsch, an energy analyst at Commerzbank in Frankfurt.

Russia oil export to rise 100kbpd in '12-dep oilmin
MOSCOW, Jan 30 (Reuters) - Russia, which lacks spare capacity to step in with extra oil if Iranian crude supplies are cut, can increase exports by about 100,000 barrels per day this year, its deputy energy minister said, roughly in line with expected output growth.
"This year we are planning (export) growth of 5 million tonnes (100,000 barrels per day) due to increased output," Deputy Energy Minister Sergei Kudryashov said on Monday after a meeting with oil companies on production sharing agreements.

S.Korea's Lee to visit Middle East to secure crude
SEOUL, Jan 30 (Reuters) - South Korean President Lee Myung-bak will visit major oil producing countries in the Middle East next month amid growing pressure from key ally the United States to join sanctions against Tehran by cutting crude oil imports from Iran.
Lee will visit Saudi Arabia, Qatar and the United Arab Emirates over four days starting Feb. 7 to secure "stable sources of energy," his office said in a statement.

Myanmar has no plans to export new gas finds
NAYPYITAW, Myanmar, Jan 27 (Reuters) - Myanmar will keep natural gas from new projects beyond 2013 for domestic consumption, a shift of policy aimed at powering its development, the country's energy minister said on Friday.
Myanmar has opened up to the outside world with astonishing speed since a civilian government took office last March after five decades of army rule. The prospect of the end of Western sanctions has prompted a surge of interest from investors.

Silver Powering 20 Million Homes as Supply Surplus Subsides: Commodities (Source: Bloomberg)
Record industrial demand for silver and resurging investor interest is diminishing a supply surplus, driving the metal used in everything from solar panels to batteries into its best start to a year in almost three decades. Manufacturers will use 15,415 metric tons, 2.5 percent more than in 2011 and reducing the glut by 41 percent to 3,297 tons, Barclays Capital estimates. Investors may buy 2,000 tons through exchange-traded products, after selling 1,300 tons last year, Morgan Stanley predicts. Prices will average $37.50 an ounce in the fourth quarter, 12 percent more than now, the median estimate in a Bloomberg survey of 13 analysts shows. The metal rallied 23 percent since closing at an 11-month low in December, entering a bull market on mounting confidence that another global recession will be avoided even as the World Bank and International Monetary Fund cut their growth forecasts.
Prices had plunged 44 percent in eight months, making it the most volatile of any metal tracked by Bloomberg, as expansion slowed from Europe to China, crimping demand for commodities.

Iron Ore-Shanghai rebar hits 3-1/2-month top as China returns
SINGAPORE, Jan 30 (Reuters) - Shanghai steel futures rose to their highest level in 3-1/2 months on Monday as the Chinese returned from a week-long Lunar New Year break, boosting expectations steel producers may replenish iron ore stockpiles.
But the modest gain in steel futures, sizeable imported iron ore stocks at Chinese ports and the likelihood that most buyers may only return to the market later this month, suggest iron ore may be in for a limited price rise.

China's steel output up 3.9 pct in early Jan-CISA
BEIJING, Jan 29 (Reuters) - China's daily crude steel output rose 3.94 percent in the first 10 days of January to 1.691 million tonnes, according to data issued by the China Iron and Steel Association (CISA) on Sunday.
Daily runs over the period were at their highest level since late October, with mills boosting production ahead of the week-long Chinese new year holiday beginning on Jan. 22.

Asia Dry Bulk-Rates to rise from 3-yr low after China break
SINGAPORE, Jan 26 (Reuters) - Rates for panamax carriers on key Asian routes could recover slightly from three-year lows over the next week as Chinese traders return from holiday, ship brokers said on Thursday.
The rate for panamax vessels travelling via the transpacific route tumbled to a three-year low of $5,915 a day on Wednesday from $6,717 last week as a flood of new vessels continued to weigh on an already oversupplied market.

20120131 0959 Soy Oil & Palm Oil Related News.

ITS CPO export down 11.9% to 1,315,323 tonnes for the period of 1~31 Jan 2012.
SGS CPO export down 13% to 1,293,078 tonnes for the period of 1~31 Jan 2012.

Soybeans (Source: CME)
US soybean futures tumbled, driven lower by traders reducing weather premium from prices and broad-based selling across asset classes. Rains forecast to move through Argentina for the next week raise hope of improved crop yields, particularly with rains coming as crops move into their critical reproductive stage, analysts say. Strength in the US dollar amid renewed worries about EU debt produced general weakness in commodities, aiding the defensive theme as well. CBOT March soybeans ended down 33 3/4c or 2.8% to $11.85 1/4.

Soybean Meal/Oil (Source: CME)
Soy product futures end lower, plunging in unison with sharp declines in soybeans. Improved crop outlooks for South American soybeans and broader based selling across commodity markets combined to pin both soymeal and soyoil in negative territory, analysts say. CBOT March soymeal ended down $9.50 at $312.70/short ton, March soyoil dropped 1.34c to 50.25 cents/pound.

China ban on Indian meal to benefit Canadian canola
BEIJING, Jan 30 (Reuters) - China will boost imports of rapeseed and rapeseed meal from Canada to maintain supplies of the feed ingredient, traders said on Monday, after Beijing imposed a ban on Indian meal found to have been tainted with a toxic chemical.
Traders said cargoes of Indian rapeseed meal loaded after Jan 1 would be denied entry while both countries work to resolve the quality issue.

'Tax free CPO export quotas delayed'
KUALA LUMPUR (Jan 31, 2012): Malaysia has delayed issuing tax free crude palm oil (CPO) export quotas for 2012 as it drafts a policy response to top supplier Indonesia's move to change its tariffs and revive its own refineries, industry and government sources told Reuters. The delay by Malaysia, the world's No 2 producer, leaves more supply for local processors but comes at a time when some refined edible oil demand has already shifted to Indonesia which last year slashed export taxes for processed oils. For plantation firms holding export quota licences, the delay has hampered their ability to supply their overseas refiners with cheap feedstock and meet existing export contracts for CPO. "The Malaysian government usually issues the quotas in the last week of December but until now, nothing has been given out," one of the sources with a local plantation firm with a licence for the quotas said yesterday.
"We had been asking since December and the lack of action is affecting our business. This is why Malaysia's exports are falling this month," added the source who could not be identified as he is not authorised to speak to the media. Cargo surveyor Societe Generale de Surveillance reported close to a 20% decline in Jan 1-25 Malaysia palm oil export from the same period a month ago. Crude shipments alone slumped 75% to 74,640 tonnes. — Reuters (The Sun Daily)