Wednesday, January 9, 2013

20130109 0944 Global Commodities Related News.

U.S. Smashes Previous Lower-48 Heat Record in 2012 (Bloomberg)
Last year was the warmest on records going back to 1895 for the 48 contiguous U.S. states and the second-worst for weather extremes including drought, hurricanes and wildfires, according to a U.S. report.
The average temperature in the region in 2012 was 55.3 degrees Fahrenheit (12.9 Celsius), 3.2 degrees higher than the average for the 20th century, the National Oceanic and Atmospheric Administration’s Climatic Data Center said today in an analysis of the year.
U.S. Climate Extremes Index, which takes into account temperatures as well as tropical storms and drought, showed 2012 followed 1998 into the record books for extreme weather with almost twice the average value, the center said. Eleven disasters caused at least $1 billion in damage, including hurricanes Isaac in August and Sandy in October.
“The heat we saw in the U.S. is consistent with what we expect in a warming world,” Deke Arndt, chief of the climate monitoring branch at the center, said on a conference call. “It’s a huge exclamation point on the end of several decades.”
The 2012 heat surpassed 1998’s record by 1 degree, a significant amount considering that only 4.2 degrees separate 1998 from the coldest year on record, 1917, said Jake Crouch, a climate scientist at the center in Asheville, North Carolina. The warmth is a reflection of natural variability as well as the impact of climate change, he said.

Corn Is Biggest Gainer as Cocoa Declines: Commodities at Close (Bloomberg)
The Standard & Poor’s GSCI gauge of 24 commodities climbed 0.2 percent to 650.04 at 5:11 p.m. in London. The UBS Bloomberg CMCI index of 26 raw materials was up 0.1 percent at 1,573.016.
Wheat rose for a second day on speculation that rainfall in parts of Kansas and Oklahoma won’t boost soil moisture as the worst drought since the 1930s persists. Corn advanced, and soybeans were little changed.
Wheat futures for delivery in March climbed 0.7 percent to $7.565 a bushel on the Chicago Board of Trade. Prices reached $7.3975 on Jan. 4, the lowest for a most-active contract since June.
Corn futures for delivery in March gained 1.1 percent to $6.93 a bushel in Chicago. Soybeans futures for the same delivery month rose less than 0.1 percent to $13.89 a bushel on the CBOT.
Arabica coffee retreated in New York, after gaining as much as 2.5 percent yesterday, on speculation investors will continue to bet on lower prices as production in top-grower Brazil may be large next season. Cocoa slumped 2.3 percent.
Arabica coffee for March delivery slid 0.6 percent to $1.4955 a pound on ICE Futures U.S. in New York. Robusta coffee for March delivery advanced 0.3 percent to $1,969 a metric ton on NYSE Liffe in London.
Raw sugar for March delivery gained 0.2 percent to 18.90 cents a pound in New York. White sugar for March delivery was down 0.2 percent at $509.70 a ton in London.
Soft commodities markets: NI SOMKTS
Copper rose in New York, rebounding from three sessions of declines, on speculation investors were buying futures as the metal’s weighting climbs in a benchmark commodity index.
Copper for delivery in March advanced 0.1 percent to $3.681 a pound by 7:43 a.m. on the Comex in New York. Copper for delivery in three months rose 0.2 percent to $8,087 a metric ton on the London Metal Exchange.
Aluminum, zinc and tin declined in London as lead and nickel rose.
Gold futures gained for the first time in four sessions as demand increased in China, the world’s second-biggest buyer.
Gold futures for February delivery rose 0.6 percent to $1,656.70 an ounce at 10:18 a.m. on the Comex in New York. The price dropped 2.5 percent in the previous three sessions.
Silver futures for March delivery rose 1 percent to $30.38 an ounce on the Comex. On Jan. 4, the price touched $29.24, the lowest for a most-active contract since Aug. 21.
Natural gas futures declined for a second day in New York on forecasts of milder weather that would reduce demand for the heating fuel.
Natural gas for February delivery fell 3.4 cents, or 1 percent, to $3.232 per million British thermal units at 9:29 a.m. on the New York Mercantile Exchange. Trading volume was 26 percent below the 100-day average. Futures tumbled to $3.05 per million Btu on Jan. 2, the lowest intraday price since Sept. 26. Gas is up 5.6 percent from a year ago.
U.K. natural gas: NI NUKMKT Gas market: NI GASMARKET Americas natural gas: NI AGASMARKET European natural gas: NI EGASMARKET
Power for February delivery in Germany dropped after rising to a record yesterday amid forecasts for colder weather. The equivalent French contract fell for the first time in four days.
Baseload German next-month electricity, for supplies delivered around the clock, lost 0.9 percent to 50.65 euros ($66.23) a megawatt-hour as of 4:20 p.m. Berlin time. The French February contract, which yesterday rose as high as 60 euros, the most since Dec. 6, slipped 1.2 percent to 58.80 euros a megawatt-hour.
Oil fell for the first time in three days in New York on expectations that U.S. stockpiles rose from a three-month low last week.
Crude oil for February delivery slid 41 cents, or 0.4 percent, to $92.78 a barrel at 10:39 a.m. on the New York Mercantile Exchange. Prices are down 8.6 percent from this point last year. Trading volume was 7 percent below the 100-day average.
Brent oil for February settlement advanced 13 cents to $111.53 a barrel on the London-based ICE Futures Europe exchange. Brent volume was 15 percent above the 100-day average.
Heating oil advanced on speculation that refinery unit shutdowns will reduce supplies and that higher gasoil prices in Europe will attract diesel shipments from the U.S.
Heating oil for February delivery rose 3.13 cents, or 1 percent, to $3.0634 a gallon at 10:17 a.m. on the New York Mercantile Exchange, after touching $3.0752.
Gasoline for February delivery gained 1.49 cents, or 0.5 percent, to $2.2923 a gallon on the exchange.
The average nationwide retail price for regular gasoline rose 0.3 cent to $3.30 a gallon, AAA said today on its website.
Oil Products Europe: NI OPEMKT Gasoline: NI GASOLINE Heating oil: NI HEATOIL

Corn Market Recap for 1/8/2013 (CME)
March Corn finished up 3 1/4 at 688 3/4, 5 3/4 off the high and 5 up from the low. May Corn closed up 3 1/2 at 688 3/4. This was 5 1/2 up from the low and 4 3/4 off the high.
March corn traded higher into the closing bell as active bull spreading, firm basis and short covering were seen as reasons for the higher trade. US corn cargos remain a premium to South American cargos which continues to stifle any positive progress in the export demand outlook. South Korea was back in the market overnight with two separate tenders. One buyer purchased 137,000 tonnes of corn for May shipment with half coming from South America and the other half was a US/South American option. The second tender was for 110,000 tonnes which will likely be sourced from South America for June arrival. The trade is looking ahead to this Fridays December 1st Grain Stocks and Supply and Demand report. December 1st stocks are estimated to come in near 8.2 billion bushels and production could fall just under 10.7 billion bushels vs. 10.725 currently. This will depend on if there is a significant adjustment to the yield and harvested acreage. Some expect a sharp decline in harvested acreage given the historically high abandonment rate in previous drought years.
January Rice finished down 0.015 at 14.96, equal to the high and equal to the low.

Wheat Market Recap Report (CME)
March Wheat finished down 3/4 at 750 1/2, 8 3/4 off the high and 1 1/2 up from the low. May Wheat closed down 3/4 at 760 1/4. This was 1 1/2 up from the low and 8 3/4 off the high.
KC and Chicago wheat spent most of the day in positive territory as European wheat futures rebounded and technical short covering was active. Kansas City wheat basis was firm on the day. Thoughts that China may have bought wheat from the US and Canada in the last week was supportive. Weather patterns point negative in the short term with another storm system set to develop in Texas by mid-week. The storms are expected to drop heavy rainfall in central TX with some flooding expected. Rainfall will push into Oklahoma and then moved into the eastern Corn Belt helping improve soil moisture conditions. US wheat remains competitively priced in the world market but major buyers from the Middle East have failed to tender this week. Some suggest buyers have good supply at the moment which could put the US export demand forecast at risk of a downgrade in this Friday's USDA report. India has become a major influence in the global wheat trade this year and Indian officials reported domestic wheat stocks as of January 1st at a whopping 34.4 million tonnes, more than four times the official target of 8.2 million tonnes for the quarter ending March. The data suggests India will continue to aggressively export wheat this crop year.
March Oats closed up 1/4 at 331 3/4. This was 3 up from the low and 2 3/4 off the high.

Corn Rises on U.S. Supply Concerns; Wheat, Soybeans Drop (Bloomberg)
Corn futures rose for the second straight day on speculation that the U.S. Department of Agriculture will lower its crop projectins following the most- severe Midwest drought since the 1930s. Wheat and soybeans fell.
The 2012 harvest probably was 10.65 billion bushels, down 0.7 percent from the USDA’s estimate in December, according to a Bloomberg News survey of 31 analysts. Corn futures reached a record $8.49 a bushel on Aug. 10. The USDA is set to release its latest crop statistics on Jan. 11.
“It scares me that everybody is thinking production will be lowered because our stockpiles are already low enough,” Darrell Holaday, the president of Advanced Market Concepts in Wamego, Kansas, said in a telephone interview. “If we come in even 100 million bushels lower on production, there’s room for prices to go higher.”
Corn futures for March delivery gained 0.5 percent to settle at $6.8875 a bushel at 2 p.m. on the Chicago Board of Trade. The price, up 0.8 percent yesterday, has gained 7 percent in the past 12 months.
Wheat futures for March delivery fell 0.1 percent at $7.505 a bushel. The price has gained 20 percent in the past 12 months.
Soybean futures for March delivery dropped 0.1 percent to $13.865 a bushel. The oilseed has advanced 16 percent in the past 12 months.
Corn is the biggest U.S. crop, followed by soybeans, hay and wheat, USDA data show.

Rice Stock Estimates Studied by FAO on Lack of Reliable Data (Bloomberg)
Rice-stock estimates for several countries including China may not be accurate due to a lack of reliable data on consumption and post-harvest losses, according to the United Nations’ Food & Agriculture Organization.
The estimate for China’s stocks may be too high, Concepcion Calpe, the FAO’s senior rice analyst, said by phone from Rome today. The UN agency is studying the rice balance sheets of several countries as part of creating the Agricultural Market Information System, she said.
The FAO has forecast world rice stocks will climb to a record 169.8 million metric tons at the end of 2012-13 from 159.3 million tons a year earlier. Growing rice stockpiles avoided a food crisis last year even as wheat and corn prices jumped on drought in the U.S. and Russia, the World Food Programme said in September.
“It’s very difficult to get any clue about the stocks,” Calpe said. “Even developed countries have problems, it’s general. FAO has very high estimates for stocks in China, and we’re worried that this might not be the case.”
The FAO, the U.S. Department of Agriculture and the International Grains Council all have different estimates for rice inventories, according to Calpe.
“We have no idea what the stocks are,” Calpe said. “Even the definition of stocks is difficult. We’re trying through AMIS to come up with a normalized method to improve the overall balances.”

Recap Energy Market Report (CME)
February crude oil experienced another choppy trading session that began with a morning push toward last week's high of $93.87. The early morning gains lacked more upside follow-through and seemed to slip into negative territory following weakness in equity markets. Some traders also noted that the upside action in the crude oil market might have been tempered by expectations that this week's EIA inventory report could show a build in supplies last week in the range of 1.75 to 2.0 million barrels. Meanwhile, the product markets managed to maintain most of their early gains, supported by further refinery complications at a crude distillation unit in Texas.

Brent Crude Oil Market Report (CME)
February Brent crude oil registered a new four day high during the session and climbed back above the $112.00 level. Early support seemed to come on prospects that this week's trade data out of China will show further improvement in global oil demand prospects. It is also possible that some traders saw recent weakness in the February Brent vs. WTI crude oil spread, back below $18 premium to Brent, as fairly valued. Meanwhile, Brent crude oil is expected to benefit from active beginning of the year index fund rebalancing. While there was little cash market trade in North Sea Forties, traders noted bids holding near their highest level since March 2012.

Oil Fluctuates on Signs U.S. Crude, Fuel Stockpiles Increasing (Bloomberg)
Oil fluctuated in New York after an industry report showed rising stockpiles in the U.S., the world’s biggest crude-consuming nation.
West Texas Intermediate futures swung between gains and losses after slipping 4 cents yesterday. U.S. crude supplies increased 2.4 million barrels last week, the American Petroleum Institute said. An Energy Department report today may show inventories gained 2 million barrels, according to a Bloomberg News survey of analysts. Gasoline and distillate inventories also climbed, the API said.
Crude for February delivery was at $93.14 a barrel, down 1 cent, in electronic trading on the New York Mercantile Exchange at 10:34 a.m. Sydney time. The contract dropped to $93.15 yesterday, the lowest settlement since Jan. 4. Prices declined 7.1 percent last year.
Brent for February settlement climbed 54 cents to $111.94 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark contract closed at a premium of $18.79 to WTI futures.
The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

Alcoa Sales Top Estimates on Aluminum Prices (Bloomberg)
Alcoa Inc. (AA), the largest U.S. aluminum producer, reported fourth-quarter sales that exceeded analysts’ estimates after the company sold the commodity at a higher-than- expected average price.
Sales fell to $5.9 billion from $5.99 billion, beating the $5.6 billion average of 11 estimates. Net income of $242 million, or 21 cents a share, compared with a loss of $191 million, or 18 cents, a year earlier, the New York-based company said today in a statement. Profit excluding a gain on the sale of a power plant and other one-time items was 6 cents a share, matching the average of 20 estimates compiled by Bloomberg.
“The metal price helped out,” said Kuni Chen, an analyst at CRT Capital Group in Stamford, Connecticut, who recommends buying the shares. “They’re meeting their revenue growth goals in the downstream.”
Aluminum prices are rising as demand in China and the U.S. increases while record amounts are being shut away in warehouses as part of financing deals. Alcoa, which said today that global aluminum demand growth will accelerate to 7 percent in 2013, is trying to avoid a downgrade to junk by Moody’s Investors Services. The ratings company said Dec. 18 it was reviewing its rating on the company’s debt.
Alcoa rose 0.8 percent to $9.17 at 6:39 p.m. in New York after the close of regular trading. The shares have declined 0.7 percent in the past 12 months while the Dow Jones Industrial Average rose 7.6 percent. Alcoa is the first company in the index to report earnings.

Gold Rises Most in a Week on Chinese, U.S. Coin Demand (Bloomberg)
Gold futures gained the most a week as demand increased in China, the world’s second-biggest buyer.
Imports by China from Hong Kong almost doubled in November from a month earlier, government data showed today. The U.S. Mint has sold 71,500 ounces of American Eagle gold coins this month, compared with 76,000 ounces for all of December. On Jan. 4, futures touched a four-month low on signals from the Federal Reserve that its latest stimulus program may end this year.
“Last week’s price drop has attracted buyers,” Anthem Blanchard, the chief executive officer of Blanchard Vault, a Las Vegas-based online retailer of gold and silver, said in a telephone interview. “We are also seeing elevated demand from China.”
Gold futures for February delivery rose 1 percent to settle at $1,662.20 an ounce at 1:48 p.m. on the Comex in New York, the biggest gain for a most-active contract since Dec. 31. The price dropped 2.5 percent in the previous three sessions.
A measure of trading on the Shanghai Gold Exchange surged to a record yesterday, according to data tracked by Bloomberg.
Japanese pension funds will more than double their gold holdings to 100 billion yen ($1.1 billion) by 2015 as the new government pushes for a higher inflation target, Itsuo Toshima, an adviser to the funds, said in an interview.
India is the top gold buyer.
Silver futures for March delivery rose 1.3 percent to $30.465 an ounce on the Comex, the biggest gain since Jan. 2. On Jan. 4, the price touched $29.24, the lowest since Aug. 21.
On the New York Mercantile Exchange, platinum futures for April delivery gained 1.7 percent to $1,583.20 an ounce, the biggest gain since Nov. 23.
Palladium futures for March delivery fell 0.3 percent to $667.85 an ounce. The price declined for the fourth straight session, the longest slump in 10 weeks.

Silver Market Recap Report (CME)
The silver market managed a quasi upside breakout on the charts today and managed the gains in the face of some adverse outside market action. With the gains today made in silver, in the face of weakness in copper and equities, which would seem to suggest to some traders that silver was potentially tracking financial or safe haven developments today. Like gold, silver might have been bolstered today by news that derivative investment into silver increased because of the recent slide in prices.

Gold Market Recap Report (CME)
The gold market generally maintained a positive tilt today and managed that action in the face of adverse currency market action and weaker US equities. Gold might have been supported by a rise in gold derivative holdings and gold might also have been supported by ideas that China might see improved gold demand in 2013. In retrospect, the gold trade seems to have come away from the temporary sub $1,636 trade in February gold with signs of value hunting or bargain hunting buying and that might have contributed to the gains in gold prices today. However, there did seem to be a noted range up extension in gold today right around noon central time and that reaction didn't seem to correlate with similar moves in outside markets.

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