20110614 1003 Global Market Related News.

 DJIA chart reading : downside biased with possible pullback correction.

 Hang Seng chart reading : pullback correction downside biased.

Asian Stocks Swing Between Gains, Losses on Oil, Greek Rating Downgrade (Source: Bloomberg)
Asian stocks swung between gains and losses as Standard & Poor’s cut Greece’s credit rating to the lowest debt grade, feeding doubts over a global economic recovery. Japanese power companies advanced.

U.S. Stocks Rise as Merger Announcements Help Offset Worries About Economy (Source: Bloomberg)
U.S. stocks rose, rebounding from six weeks of losses, as a pickup in takeovers and the cheapest valuations in almost a year helped offset concerns about a slowdown in the economic recovery. Transatlantic Holdings Inc. (TRH), the reinsurer formerly owned by American International Group Inc., surged 9.5 percent after agreeing to merge with Switzerland’s Allied World Assurance Company Holdings AG. Timberland Co. (TBL) rallied 44 percent as VF Corp. (VFC) said it will buy the footwear maker for $1.8 billion. Halliburton Co. and Freeport-McMoRan Copper & Gold Inc. slumped at least 1.2 percent amid falling commodity prices.

Fed prepares for last spurt of easy money flood
NEW YORK, June 10 (Reuters) - The flood of Federal Reserve money that has supported Wall Street and the rest of the U.S. economy for 2-1/2 years will shrink to a trickle with the conclusion of the Fed's bond purchases announced on Friday.
The Fed said it will buy $50 billion of Treasuries, the final series of government bond purchases that marks the last phase of the $600 billion program it launched in November 2010 to prevent another recession.

US auto dealer group sees rebounding summer sales
WASHINGTON, June 10 (Reuters) - New U.S. car and truck sales are expected to lag again in June, but things should pick up in the second half of the year, the largest auto dealers group said on Friday.
Paul Taylor, chief economist of the National Automobile Dealers Association (NADA), said the group anticipates inventory shortages that slowed May sales to affect this month's results. But a turnaround should occur after that, helped by an improving credit outlook and lower gasoline prices.

Profits Seen Increasing Jobs as Earnings in U.S. Grow Fastest Since 1940s (Source: Bloomberg)
Profits at American companies are poised to be one of the few bright spots in the U.S., helping to steady the faltering recovery. Earnings will climb an average 10 percent a year through 2013, more than three times quicker than the economy, after what has already been the fastest rebound since the late 1940s, JPMorgan Chase & Co. projects. In mounting signs of confidence, Macy’s Inc. (M) has raised its annual profit forecast, Intel Corp. (INTC) and Target Corp. (TGT) increased dividends and DuPont Co. plans to invest more than $500 million to boost production.
Surging overseas sales, improving U.S. demand and the Federal Reserve’s pledge to keep interest rates close to zero for an extended period bode well for earnings, said Robert Mellman, an economist at JPMorgan who has tracked corporate profits since 1985 and published a special report May 20 on the subject. Widening margins will give businesses the means and incentive to invest and hire, paving the way for accelerating growth in the world’s largest economy, he predicted. “Corporate profits have plenty of room to run,” as “returns on investing and expanding are high,” Mellman said in a June 10 interview from New York. “This makes companies want to grow the business. As profitability remains strong, they’ll increase hiring.”

China Lending Unexpectedly Tumbles, Adding to Evidence Economy Is Slowing (Source: Bloomberg)
China’s lending tumbled in May and money supply grew at the slowest pace since 2008, adding to signs that the world’s second-biggest economy is cooling. Loans were 551.6 billion yuan ($85 billion), less than the 650 billion yuan median estimate in a Bloomberg News survey of 20 economists and 639 billion yuan a year earlier. M2, the broadest measure of money supply, rose 15.1 percent, the People’s Bank of China said on its website.

Japan reconstruction panel eyes boom in autumn
TOKYO, June 11 (Reuters) - Spending to rebuild Japan's tsunami-hit northeast will spark an economic boom later this year, generating revenues that can be used to redeem reconstruction bonds and reduce the need to rely on long-term debt, the head of a government advisory panel said.
Makoto Iokibe, chairman of the Reconstruction Design Council, also called for a mass consolidation of ports along the coast to boost the fishing industry and aggressive investment to make the region a pioneer in renewable energy development.

Greece Receives Lowest Credit Rating by S&P (Source: Bloomberg)
Greece was branded with the world’s lowest credit rating by Standard & Poor’s, which said the nation is “increasingly likely” to face a debt restructuring and the first sovereign default in the euro area’s history.

Greece Receives Lowest Credit Rating by S&P (Source: Bloomberg)
Greece was branded with the world’s lowest credit rating by Standard & Poor’s, which said the nation is “increasingly likely” to face a debt restructuring and the first sovereign default in the euro area’s history. The move to CCC from B reflects “our view that there is a significantly higher likelihood of one or more defaults,” S&P said in a statement yesterday. “Risks for the implementation of Greece’s EU/IMF borrowing program are rising, given Greece’s increased financing needs and ongoing internal political disagreements surrounding the policy conditions required.”

Trichet’s ‘Cold War’ With Germany Risks Damage That May Force Compromise (Source: Bloomberg)
The confrontation between the European Central Bank and Germany over bailing out Greece risks causing so much damage that officials may be forced to compromise. “The balance of forces in the euro zone is a little like it was in the Cold War: both sides are brandishing deterrents that would be too horrendous to use,” said Philip Whyte, a senior research fellow at the Centre for European Reform in London. “It’s all going to turn on whether you can fiddle with debt maturities without calling it a credit event.”

Euro bounce to fade on Greek worries; stocks slip
HONG KONG, June 13 (Reuters) - The euro strengthened , though its gains appeared short-lived as major European powers continue to haggle over a fresh rescue package for Greece, while Asian stocks extended a seven-week losing streak on fears the global recovery is losing steam.
Concerns over a sputtering U.S. economic recovery, slowing growth in China and India and festering problems in the euro zone pushed the MSCI index of Asia Pacific shares outside Japan down by nearly 1 percent to a 2-1/2 month low before regaining some ground to be 0.6 percent lower.

Euro Falls Versus Yen, Dollar on Concern Greece’s Debt Crisis Will Worsen (Source: Bloomberg)
The euro fell against the yen and the dollar on concern European Union finance ministers meeting today will struggle to resolve Greece’s debt crisis.

FOREX-Euro at record low vs Swiss franc on Greek jitters
LONDON, June 13 (Reuters) - The euro hit a lifetime low against the safe-haven Swiss franc and slipped versus the dollar, as investors worried at policymakers' struggles over the Greek debt crisis cut their exposure to the common currency.
Volumes were on the lower side with many centres in Europe closed for a holiday. The cost of insuring peripheral euro zone bonds against default hit a record high, while a general lack of appetite towards riskier assets also pushed the euro lower.

20110614 0956 Global Commodities Related News.

Corn (Source: CME)
US corn futures finish lower on expectations that mild temperatures and wet weather will boost crop conditions. That's a turnaround from excessive rains that delayed plantings earlier this spring and caused some farmers to plant fewer acres than they intended. "Any corn that did manage to get planted in the Midwest should do well," says Joel Burgio, meteorologist for Telvent DTN. The losses follow a surge to record highs Friday. CBOT July corn slips 4 1/2c to $7.82 1/2 a bushel.

Wheat (Source: CME)
US wheat futures tumble as weather improves in Europe, a major exporter of the grain. Rains this week "should further improve moisture and crop conditions" in France and Germany after recent rains helped ease dryness, according to MDA EarthSat Weather. Prices had advanced recently on concerns about a drought in Western Europe. Yet, "weather has been and looks beneficial across most of the world's crop growing regions," says John Roach, president of Roach Ag Marketing. CBOT July wheat drops 16 1/4c to $7.43, KCBT July loses 17c to $8.51 and MGE July slides 14 3/4c to $9.85 1/4.

Rice (Source: CME)
Rice futures fall hard on profit-taking with the neighboring wheat and corn markets. Traders took money off the table in the grains after recent advances. Wheat's slide of more than 2% added spillover pressure to rice as both grains are global food staples. July rice finishes down 28 1/2c, or 1.9%, at $14.61 per hundredweight.

Price Increases To Affect Nestle Emerging Market Sales - Exec (Source: CME)
Natural and man-made disasters as well as spiralling raw material costs will hit emerging markets sales at Swiss food company Nestle SA, Executive Vice President Frits van Dijk said, as the company struggles to pass the higher costs on to consumers. Nestle's Asia Oceania Africa Zone was the fastest growing of Nestle's three global regions in the first three months of 2011, but rapid rises in commodity costs mean growth is likely to slow as many consumers in the region are on lower incomes and more sensitive to price increases, van Dijk told Dow Jones Newswires in an interview in Jakarta. The AOA region, which accounts for around two thirds of Nestle's emerging market exposure, saw sales growth of 11.8% to CHF3.8 billion ($4.54 billion) in the first three months of the year, ahead of the Americas, where sales were up 3.7% and Europe which saw sales growth of 2.3%. But Nestle is now faced with the challenge of maintaining its target of organic growth of 5% to 6% while continuously improving the bottom line.
Rapid rises in commodity costs "is obviously affecting us," said van Dijk, and Nestle brought in some price increases in the first three months of 2011,but he said the company is looking at ways other than price increases to meet its targets and protect margins. "We have to find ways and means of how to cope with this [raw materials rises]. Price increases is one solution, but clearly not the only solution," he said. "We have seen it in the past when you increase prices for a few months, you get a bit of headwind and the consumers have to adapt," said van Dijk. "But on the other hand, it is the whole industry that is suffering. Everyone ultimately will have to go through price increases. The whole price level goes up a bit, but the consumers get used to that after a while."
Nestle is also looking to improve efficiencies, reduce waste and packaging, and is reengineering its products to use cheaper ingredients, such as replacing much of the skimmed milk powder content of its Milo malt drink in Vietnam with less expensive soya protein. "This allowed us to maintain the very competitive price point of 1,500 Vietnamese Dong (7.3 U.S cents), which is a very strategic price for food and beverage in Vietnam," van Dijk said. "By keeping a price point we are able to grow the business at a lower cost." In 2011 the AOA region also faced a series of disturbances, from the Arab Spring uprisings in North Africa to the civil war in Ivory Coast and the Japanese tsunami and nuclear disaster. Nestle had to shut its factories in Ivory Coast when the fighting became heavy, while many countries refused to accept coffee and creaming products made in Japan due to fears over nuclear contamination.
Nestle had a series of business contingency plans which it put into effect to supply markets from other sources. Van Dijk declined to put a figure on the sales that were lost. "You lose a few days of sales, but nothing too much. But our competitors are in the same boat, so you don't lose market share. You have to fill up the pipeline after." In Japan, production was resumed at the damaged factory two and half weeks after the disaster. "We have stepped up our disaster planning," said Van Dijk, adding that the company's readiness to deal with disasters is "of a very high level."

French Agriculture Min: Drought Situation In France Is "Very Severe" (Source: CME)
France has been experiencing a "very severe" drought since the start of the year and possibly "the worst" of all Europe, French Agriculture Minister Bruno Le Maire said. Speaking in an interview with RTL radio and LCI television, Le Maire insisted that French farmers would get all the possible help, including the use of the country's armed forces and the state-owned railway company to carry fodder where needed as some farmers have been experiencing difficulties to feed animals due to the drought. "My objective is that not a single one farmer gives up during this drought crisis," Le Maire said, insisting that the future of "thousands" of farms was at stake. As for the German E. coli crisis, Le Maire noted that it was far from over as consumption of vegetables such as cucumbers and tomatoes was resuming too slowly.

Sustainable Farming Needed to Feed the World (Source: CME)
The Green Revolution of the 1960s saved an estimated 1 billion people from poverty and produced enough food to support a doubling of the world population to six billion by the year 2000. Thanks to high-yielding crops, irrigation and the widespread use of agrochemicals, farmers in the developing world boosted output from 800 million tons to more than 2.2 billion tons in that time. But now, as global yield growth is declining while the world's population looks set to top nine billion in the next 40 years, United Nations experts are calling for a new, even greener revolution. A new initiative from the Food and Agriculture Organization argues that decades of intensive farming has ravaged the world's natural resources, causing land degradation, sapping water supplies and contributing massively to climate change. "The present paradigm of intensive crop production cannot meet the challenges of the new millennium," said the FAO in its report, called Save and Grow.
Adding to the challenge is that fact that the amount of land available for cultivation is limited while demand, driven by a growing taste for meat and diversion of crops for biofuels, is growing exponentially. The FAO estimates that by 2020, industrialized countries may use 150 kilograms of corn per head per year in the form of ethanol, a similar increase to the rate of cereal food consumption in developing countries. Instead, the report calls for a new approach that will cut agriculture's contribution to climate change--it currently emits around a third of the world's greenhouse gasses--by empowering the world's 2.5 billion smallholder farmers through more sustainable methods of cultivation. An estimated $209 billion a year will need to be ploughed into agriculture, including improving access to high-yield and genetically modified seed varieties, improving the use of natural fertilizers and reducing dependence on pesticides and using water more efficiently, the FAO estimates.
"In order to grow, agriculture must learn to save," said FAO director-general Jacques Diouf. The report comes as agriculture ministers from the Group of 20 industrialized nations are due to meet next week to agree ways to combat food insecurity. Proposals include creating a coordinated forecasting system for crops, improving transparency in commodities markets and world stock levels. "Whatever the investment and however much is made it should be channeled towards new products and intensification of production on existing land," said Dr. Amit Roy, president and chief executive of the International Fertilizer Development Council. He argues that farmers in the developing world must have better access not just more but better technology if they are to boost yields without bringing more land under the plough. "They're using old technology in a world that's changed," he said. The Green Revolution of half a century ago helped farmers to exploit natural resources to create more from less.
This new revolution must teach us how to save what we have to preserve more for the future.

Europe's Drought Risks Inflation Deluge (Source: CME)
It will take more than a washed-out holiday weekend to put a smile back on the faces of European farmers - and policymakers. Dry weather in the continent's northern regions has seriously harmed potential crops, with the U.K. the latest country to declare drought conditions in some parts of the country -- England and Wales have experienced the second driest spring since 1910, with rainfall 45% below the long-term average. The feed-through to overall inflation levels is getting harder to ignore. Wheat, which accounts for nearly half of Europe's cereal production, is particularly at risk. Already, the price of milling wheat traded in Paris has risen 6.6% this year. France, Europe's largest wheat producer, is suffering its driest weather in 50 years, and could see its crop decline by 12% this year, the US Department of Agriculture estimates. Much of the price rise will be felt domestically, with Europe consuming around 85% of its annual wheat production.
Rapeseed, another important crop used in both biofuels and edible oils, has meanwhile seen its price rise by 46% since a year ago. Unless imports form Ukraine increase, its current near-term futures price of EUR466.5 per ton could rise to EUR500 per ton, Rabobank forecasts. Such price rises are feeding through to overall European inflation: euro zone food prices rose by 1.8% on-year in April, according to Eurostat, up from 0.1% in April 2010. Sure, the weighting of food in the euro zone consumer price index, at 14%, is low compared with emerging market CPI baskets. But its weight as a source of inflationary pressure is rising. In 2010, food contributed just 4% of overall euro zone inflation. In 2011, that could rise to 14%, according to Barclays Capital, heading higher to 17% in 2012. Since food demand doesn't fall much even as prices rise, higher food expenses will hit already stretched household budgets, especially for poorer families.
The effect of higher basic food prices is already pushing up the cost of processed food. The year-on-year inflation rate for bread and cereals has risen sevenfold in the last six months, to 2.1%, for example. But the full effect still may not have been seen: Bread prices typically lag wheat futures by around six months, BarCap estimates. Europe's sun seekers may be enjoying the warm conditions. But for central bankers trying control the continent's inflation, it is another headache.

Wheat up 1 pct, corn rises on supply squeeze, weather
SINGAPORE, June 13 (Reuters) - U.S. wheat futures rose 1.2 percent , while corn firmed to trade near last week's all-time highs as concerns over tightening grain supplies and harsh crop weather continued to buoy
the grain markets.
"Corn prices are too high and livestock producers are switching from corn to feed wheat. It is a supportive factor for wheat prices," said Ker Chung Yang, a commodities analyst at Phillip Futures in Singapore.

New downpours to hit flooded central and southern China
BEIJING, June 13 (Reuters) - More torrential rains are likely to hit central and southern China where nearly 100 people have been killed in floods and landslides over the last 10 days, the government said on Monday, as drought rapidly gives way to inundation.
Downpours are forecast for the middle and lower reaches of the Yangtze River, including Guizhou, Jiangxi, Hubei and Hunan provinces, the China Meteorological Administration said.

Farmers must boost sustainable crops to feed world-FAO
MILAN, June 13 (Reuters) - The ravages from half a century of intensive farming must give way to a more sustainable approach if farmers are to feed the world in 2050, the United Nations' Food and Agriculture Organisation (FAO) said on Monday.
Global farm output must increase 70 percent, including a nearly 100 percent jump in developing countries, to feed the world in 2050, the FAO said.

Vietnam to stockpile 1 mln T rice from July
HANOI, June 13 (Reuters) - Vietnamese exporters will stockpile 1 million tonnes of milled summer-autumn rice for three months beginning July 15, a typical move to support domestic prices as the harvest in the Mekong Delta food basket peaks.
This time the stockpiles, equivalent to a quarter of the current crop output, would be built without government support in the form of low-interest loans or a guanranteed place in government export deals. 

Government declares drought in parts of east England
LONDON, June 10 (Reuters) - The British government declared a state of drought on Friday in parts of East Anglia, an important farming region in eastern England, after some areas of the country had their driest spring on record.
Declaring a region to be in a state of drought allows water companies to place curbs on the use of water.

Spain grain farmers eye good crop, tight supply
MADRID, June 10 (Reuters) - Spanish grain farmers expect to reap the benefits of producing their best harvest for three years this summer just as global supplies are tightening and driving prices higher.
Asaja recalled in a statement that the International Grains Council forecasts for global supply of 1.803 billion tonnes in the 2011/12 market year would fall slightly short of 1.812 billion in consumption.

Romania sees 6.7 mln T wheat, weather damage marginal
BUCHAREST, June 10 (Reuters) - Romania expects to reap a wheat crop of about 6.7 million tonnes this year, 18 percent higher than in the previous season, the agriculture ministry said on Friday.
The wheat crop in Romania, one of the largest cereal producers in the Black Sea region, was 5.7 million tonnes in 2010 while maize output grew to a five-year high of 9 million -- the European Union's second biggest.

Coffee dips, weighed by Brazil harvest; cocoa rises
LONDON, June 13 (Reuters) - ICE arabica coffee futures edged lower early weighed by Brazil's harvest, while cocoa firmed, with upside limited by a steady flow of supplies from top producer Ivory Coast.
Liffe white sugar futures firmed to around three-month highs and ICE raw sugar hovered around seven-week peaks, underpinned by tight supplies during a period of high demand before Ramadan in August, and port loading delays in Brazil and Thailand. Arabica coffee futures on ICE edged lower, weighed by Brazil's harvest, and remained underpinned by a shortage of high quality beans and the looming frost season in Brazil.

I.Coast cocoa arrivals hit 1,153,712 T by June 5 -BCC
ABIDJAN, June 10 (Reuters) - Cocoa arrivals to ports in top grower Ivory Coast hit 1,153,712 tonnes by June 5 since the start of the season in October, up from 1,009,646 tonnes in the same period a year ago,
according to official data.
Some 11,174 tonnes of beans reached the ports of Abidjan and San Pedro in the most recent week, according to the figures from industry regulator BCC obtained by Reuters on Friday, compared with 23,289 tonnes in the same week of the 2009-10 season.

Crude Oil Declines for a Third Day in New York on Signals Demand Weakening (Source: Bloomberg)
Oil declined for a third day in New York as signs that the global economy is slowing stoked speculation that fuel demand may falter. Futures slipped as much as 0.5 percent today before reports that may show sales by U.S. retailers fell in May for the first time in 11 months and China’s industrial production slowed. Prices dropped to a four-week low yesterday after government data showed China’s oil-product consumption slid 4 percent in May and Standard & Poor’s cut Greece’s credit rating to the lowest held by a country.

Copper in London Trades Little Changed Ahead of Chinese Output, Price Data (Source: Bloomberg)
Copper in London, trading little changed before China’s industrial production and inflation reports, may drop for a third day on speculation demand will weaken as global economic growth falters. The metal for three-month delivery on the London Metal Exchange traded at $8,910 a metric ton by 8:04 a.m. Singapore time. It fell as much as 0.8 percent to a three-week low of $8,864.75 a ton yesterday.

Goldman Sachs keeps 12-Month LME Copper price outlook
Jun 10 (Reuters) - Goldman Sachs reiterated its 12-month LME Copper price forecast of $11,000/mt saying an observed large deficit in China in the month of May will add to the substantial deficit in the global copper market this year.
The investment bank said it expects China's pull on copper imports to rise in the third quarter of 2011 as exchange and bonded warehouse inventories draw down to lower levels.

EU stainless steelmakers' profits to fall in Q2
LONDON, June 13 (Reuters) - European stainless steel producers' profits look set to shrink in the normally strong second quarter as prices for their products fall and customers opt to work off stocks rather than make fresh purchases.
On top of that, expectations of further weakness in prices for nickel -- a key ingredient in many stainless steel grades -- will keep stainless buyers hesitant in the next few months.

China lead pollution outbreak poisons 103 children
BEIJING, June 12 (Reuters) - Lead pollution from workshops in eastern China seriously poisoned 103 children and has affected hundreds of other residents in the country's latest case of unfettered industrial toxins, the official Xinhua news agency reported on Sunday.
The pollution from tinfoil-making workshops in Yangxunqiao town in Zhejiang province left the children, aged 14 or younger, with 250 microgrammes or more of lead for every litre of blood.

METALS-Copper slips on signs of China cooling, holidays
LONDON, June 13 (Reuters) - Copper dropped half a percent to a three-week low on Monday, dragged down by signs of cooling in top consumer China amid holiday-thinned trade, but prospects for a demand pick-up in the second half kept sellers at bay.
Three-month copper on the LME traded at $8,876 at 0958 GMT, compared with a close of $8,938 a tonne on Friday.

PRECIOUS-Gold falls on dollar, safe-haven status supports
LONDON, June 13 (Reuters) - Gold fell on Monday as the euro eased against the dollar, but concerns about the euro zone debt crisis sustained investor interest in the precious metal as a safe store of value.
Bullion fell almost 1 percent on Friday, its biggest one-day decline in a month, due to a rally in the dollar and broad commodities losses.

Gold Falls to Three-Week Low on Sales to Cover Losses in Slumping Equities (Source: Bloomberg)
Gold dropped to a three-week low on sales by some investors to cover losses in equity markets. The MSCI All-Country World Index of stocks touched the lowest in more than two months. The Standard & Poor’s 500 Index has fallen for six straight weeks. Gold reached a record $1,577.40 an ounce on May 2. “Gold may tumble if margin-call problems should arise in equities here and abroad,” said Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter. On the Comex in New York, gold futures for August delivery fell $13.60, or 0.9 percent, to settle at $1,515.60 at 1:53 p.m. Earlier, the price touched $1,511.40, the lowest for a most- active contract since May 23.

Japan May aluminium stocks rise 2.9 pct m/m
TOKYO, June 13 (Reuters) - Aluminium stocks held at three major Japanese ports at the end of May rose to a seven-month high, reflecting inflows from delayed deliveries and also a rise in imports, an official at trading house Marubeni Corp  said on Monday.
Aluminium stocks at the ports came to 225,400 tonnes at the end of May, up 6,300 tonnes or 2.9 percent from a month earlier, said Marubeni, which collects data from the key ports of Yokohama, Nagoya and Osaka.

Boeing eyes aluminum hedging amid market volatility
NEW YORK, June 10 (Reuters) - Boeing Co  may decide within the next year to begin hedging aluminum prices on the London Metals Exchange (LME) in order to reduce volatility in its costs, a senior executive said on Friday.
If initiated, the company intends to use the new hedging program on its long-term agreements, John Byrne, an executive with the company's commercial airplanes unit, told Reuters.

20110614 0954 Soy Oil & Palm Oil Related News.

Soy Oil chart reading : side way range bound.

Soybeans (Source: CME)
US soybean futures end lower, succumbing to broader-based selling pressure as investors reduced risk exposure across commodity asset classes. Guidance of lower crude oil and metal futures attracted selling across grain and soybean futures. Absence of fresh fundamental developments to direct prices initially promoted a choppy theme, but slower export demand and less threatening supply outlooks applied pressure to attract selling as prices consolidate below the top end of a four-month trading range, analysts said. CBOT July soy end down 0.3% at $13.82 3/4/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures end lower, with traders booking profits on recent gains in soymeal amid a lack of fresh supportive news to inspire fresh buying, analysts said. Soyoil ended slightly lower, with profit taking on long soymeal/short soyoil spreads offsetting some the pressure from crude oil declines on soyoil futures, analyst add. CBOT July soymeal ends down 0.9% at $370.10 per short ton, and July soyoil settles down 0.05% at 56.82 cents/pound.

High stocks, output drag palm to 1-mth lows
KUALA LUMPUR, June 13 (Reuters) - Malaysian palm oil futures hit over one-month lows , extending losses from the previous session, as expectations of stronger output and higher stocks continue to weigh.
"Fundamentally, high stocks and improving production triggered a sell-off among the people who went for a long position," said a trader in Kuala Lumpur.

20110613 1822 FCPO EOD Daily Chart Study.

FCPO closed : 3256, changed : +17 points, volume : lower.
Bollinger band reading : correction pullback little downside biased.
MACD Histrogram : fall lower, seller in control.
Support : 3250, 3200, 3150, 3100 level.
Resistance : 3270, 3300, 3350, 3420 level.
Comment :
FCPO market closed recorded small gain having pullback correction after continuing 5 days drop with getting slower volume participation while soy oil last Friday closed lower and currently having technical rebound.
Traders decided to lock in profit after recent severe fall of of more than 200 points lifted price to closed little higher.
Daily chart formed an up doji bar candle with longer lower shadow closed right at lower Bollinger band level after market opened lower, edge up slightly and fall lower tested support level before profit taking activities kicked in lifted price upwards to closed near the high of the day.
Technical reading suggesting a correction pullback little downside biased market development possibly testing higher resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target. 

20110613 1804 FKLI EOD Daily Chart Study.

FKLI closed : 1541 changed : -10 points, volume : higher.
Bollinger band reading : correction range bound little upside biased.
MACD Histrogram : falling, seller testing market.
Support : 1540, 1530, 1515, 1500 level.
Resistance : 1550, 1565, 1580, 1590 level.
Comment :
FKLI closed recorded loss with better volume transacted doing about 5 points discount compare to cash market that also closed recorded loss and regional markets (Asia and Europe) trading mostly lower while overnight U.S. market closed substantially lower.
Slowing down China economy intensified the negative sentiment market with unsolved Greek problem, doubting U.S. economy recovery plus sky high debts. Now, even the QE3 program by Federal Reserve is consider a negative measure.
Daily chart formed a down doji bar candle closed below middle Bollinger band support level after market opened lower, pushing really hard tested above support turned resistance 1550 level but selling pressure is just to heavy to hold on resulted market to fall downwards and closed near the low of the day.
Chart reading turned to suggesting a correction range bound little upside biased market development possible testing lower support level with MACD indicator having a negative cross down.
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.

20110613 1542 Global Market & Commodities Related News.

Euro firms as Greek drama grinds on; stocks dip
HONG KONG, June 13 (Reuters) - The euro bounced on Monday, though its gains appeared short-lived as major European powers continue to haggle over a fresh rescue package for Greece, while Asian stocks extended a seven-week losing streak on fears the global recovery is losing steam.
Asian stocks outside Japan fell 0.6 percent to a 2-1/2 month low as weak global economic data and fresh worries about Greece weighed on investor confidence.

India's May vegoil imports seen up as local supply falls
NEW DELHI, June 10 (Reuters) - India's vegetable oil imports may have risen by 37 percent in May, the second straight monthly rise, as local supply dropped on depleting oilseeds stocks ahead of the summer planting season, a trend that is likely to continue next month, a Reuters survey showed on Friday.
Palm oil imports, which account for the bulk of India's cooking purchases, are expected to have risen 50 percent in May over the previous month, according to a survey of eight traders.

Wheat up 1 pct, corn rises on supply squeeze, weather
SINGAPORE, June 13 (Reuters) - U.S. wheat futures rose 1.2 percent on Monday, while corn firmed to trade near last week's all-time highs as concerns over tightening grain supplies and harsh crop weather continued to buoy the grain markets.
"Corn prices are too high and livestock producers are switching from corn to feed wheat. It is a supportive factor for wheat prices," said Ker Chung Yang, a commodities analyst at Phillip Futures in Singapore.

Spain grain farmers eye good crop, tight supply
MADRID, June 10 (Reuters) - Spanish grain farmers expect to reap the benefits of producing their best harvest for three years this summer just as global supplies are tightening and driving prices higher.
Asaja recalled in a statement that the International Grains Council forecasts for global supply of 1.803 billion tonnes in the 2011/12 market year would fall slightly short of 1.812 billion in consumption.

Oil dips as investors eye U.S. economy, Saudi output
Singapore, June 13 - Oil edged lower on Monday, with Brent below $119, as growing investor concern about a slowdown in the United States and other industrialised economies combined with expectations that top exporter Saudi Arabia would increase output.
"Saudi Arabia is going to attempt to increase oil production and there are ongoing concerns about a global economic slowdown," said Serene Lim, an oil analyst at ANZ in Singapore.

China May natgas imports up 130 pct; gas to power rises
BEIJING, June 13 (Reuters) - China imported 2.6 billion cubic metres (bcm) of natural gas in May, up 130 percent from a year earlier and up 0.6 percent from April on a daily basis, data from the National Development and Reform Commission (NDRC) showed on Monday.
Gas pumped in from central Asia via a transnational pipeline accounted for half of the imports, and gas bought in the form of liquefied natural gas (LNG) made up the rest.

Copper ends up in anticipation of China trade data
NEW YORK/LONDON, June 9 (Reuters) - Copper eked out a modest gain by the close on Thursday, as expectations for a rebound in Chinese imports counterbalanced the negative macro-economic impact from weekly U.S. jobless claims figures.
"It's a bright spot in an otherwise gloomy economic landscape, so it suggests that the U.S. economy is getting support from a least one quarter -- the trade sector," said Peter Buchanan, commodities analyst and senior economist at CIBC in Toronto.

Chile copper mine struggles after strike violence
SANTIAGO, June 12 (Reuters) - Output at Chile's El Teniente mine, the world's No. 5 copper deposit, remained well below capacity on Sunday as staffing was limited by renewed violence from striking contractors, mine owner Codelco said.
The state miner had expected to return to full production this weekend, but protester violence on Friday led the company to hold many workers back from the 404,000 tonnes-a-year mine.

China lead pollution outbreak poisons 103 children
BEIJING, June 12 (Reuters) - Lead pollution from workshops in eastern China seriously poisoned 103 children and has affected hundreds of other residents in the country's latest case of unfettered industrial toxins, the official Xinhua news agency reported on Sunday.
The pollution from tinfoil-making workshops in Yangxunqiao town in Zhejiang province left the children, aged 14 or younger, with 250 microgrammes or more of lead for every litre of blood.

Boeing eyes aluminum hedging amid market volatility
NEW YORK, June 10 (Reuters) - Boeing Co  may decide within the next year to begin hedging aluminum prices on the London Metals Exchange (LME) in order to reduce volatility in its costs, a senior executive said on Friday.
If initiated, the company intends to use the new hedging program on its long-term agreements, John Byrne, an executive with the company's commercial airplanes unit, told Reuters.

Gold holds steady as U.S. dollar slips
SINGAPORE, June 13 (Reuters) - Gold held steady in thin trade on Monday as the euro bounced against the U.S. dollar, but needs to surpass recent peaks to sustain an uptrend fuelled largely by a debt crisis in Europe.
"I think it is still looking for sufficient momentum and a catalyst that's needed for it to break the $1,550 level on a sustained basis," said Ong Yi Ling, investment analyst at Phillip Futures in Singapore.

China energy imports robust in May, but copper weak
SHANGHAI/BEIJING, June 10 (Reuters) - China showed robust demand for crude oil and coal in May, shrugging off higher prices to boost imports by more than 20 percent, but its appetite for overseas copper supplies remained sickly and iron ore buying showed signs of ending a strong run.
Economists are watching closely for signs of slowing economic growth in China, which would reduce demand for raw materials, as the government tightens the money supply to prevent inflation.  

20110613 1142 Global Market & Commodities Related News.

GLOBAL MARKETS: Debt worries keep euro under pressure; stocks dip
HONG KONG, June 13 (Reuters) - The euro stayed under pressure and Asian stocks weakened in early trades on Monday on renewed worries over the global economy and concern that protracted wrangling in the euro zone could delay a solution to Greece's debt crisis.
Despite Asian stocks outside Japan  > dipping to a 2-1/2 month low, bargain-minded investors stayed on the sidelines due to a stream of bad news from the euro zone's festering debt crisis, the sputtering U.S. economy and signs of a slowdown in growth engines like China and India.

OIL: Oil falls on more Saudi crude, strong dollar
NEW YORK, June 10 (Reuters) - Oil prices fell on news Saudi Arabia was offering more oil to Asian customers, with additional pressure from a stronger dollar and weak equities.
"Saudi Arabia is offering oil even though OPEC didn't have an agreement on production," said Hamza Khan, analyst at the Schork Group in Villanova, Pennsylvania.

NATURAL GAS: Natgas ends up 2 pct, shorts cover ahead of weekend
NEW YORK, June 10 (Reuters) - Front-month U.S. natural gas futures ended higher , backed by short covering ahead of the weekend despite milder weather next week, particularly for the Northeast and Midwest, that should slow demand.
"The market rebounded a bit after yesterday's sell off, but there's still some above normal temps ahead," a southern-based commodity trading advisor said, noting heat was expected to remain in Texas and the South next week.

EURO COAL: Prices dip, Aug ARA trades at $124.25/T
LONDON, June 10 (Reuters) - Coal prices were 75 cents to $1.50 lower after a $3 fall in oil and amid a lack of demand for standard-grade coal, particularly in Europe.
"Swaps and physical aren't talking to one another. The question is how long can this disconnection continue before something gives?" one utility source said.

COMMODITIES: Down on demand worry, dollar; US oil below $100
NEW YORK, June 10 (Reuters) - Most commodities fell , with oil and copper hitting two-week lows on selling sparked by a strong dollar and worries about supply exceeding demand.
U.S. crude oil fell almost 3 percent to below $99 per barrel on news that Saudi Arabia was offering more oil to Asian customers. The market had rallied above $100 in two previous sessions after producers in OPEC failed to agree with a Saudi plan to hike production.

Malaysia, Indonesia imports to lift Asia LNG price
SINGAPORE, June 10 (Reuters) - Already strong Asian liquefied natural gas prices will get a further fillip as Indonesia and Malaysia, the world's second- and third-biggest exporters, turn to imports to feed local demand.
Indonesia is building LNG import terminals with capacity of nearly 10 million tonnes, while Malaysia expects to receive its first shipment in 2013. This about-turn is happening just as Japan cranks up gas-fired power plants to make up for lost nuclear generation.

China energy imports robust in May, but copper weak
SHANGHAI/BEIJING, June 10 (Reuters) - China showed robust demand for crude oil and coal in May, shrugging off higher prices to boost imports by more than 20 percent, but its appetite for overseas copper supplies remained sickly and iron ore buying showed signs of ending a strong run.
Economists are watching closely for signs of slowing economic growth in China, which would reduce demand for raw materials, as the government tightens the money supply to prevent inflation.  

20110613 1007 Global Economic Related News.

India: Industrial output growth slows; rate pressure stays
India’s industrial production growth eased in April, a slowdown that has yet to curb pressure for more interest-rate increases to damp inflation. Output at factories, utilities and mines rose 6.3% from a year earlier after an 8.8% gain in March, the Central Statistical Office said in a statement in New Delhi, after it changed the base year to 2004-05. The median of 23 predictions in a Bloomberg News survey was for a 5.5% advance, based on 1993-94 prices. (Bloomberg)

China: Reports less-than-estimated USD13bn trade surplus
China reported a less-than-estimated USD13.1bn trade surplus in May, as surging imports signaled the nation’s demand may support global growth while adding pressure for higher interest rates. Inbound shipments climbed 28% from a year earlier and exports rose 19%, the customs bureau said on its website. The median estimate in a Bloomberg News survey of 23 economists was for a USD19.3bn surplus. The International Monetary Fund said last Friday that China can sustain economic growth of about 9.5% this year and next even as the government cools the real-estate market and reins in bank lending to counter inflation. (Bloomberg)

UK: Manufacturing drops on impact of holidays, Japan quake
UK manufacturing fell more than economists forecast in April as the extra public holiday for the royal wedding hurt orders and the impact of the Japanese earthquake hit supplies. Factory output dropped 1.5% from the previous month, the most since January 2009, the Office for National Statistics said in London. The median forecast of 24 economists in a Bloomberg News survey was a 0.1% decline. A separate report showed that prices at factory gates rose 0.2% in May, the least since September. (Bloomberg)

US: Obama says private sector must lead US in creating jobs
President Barack Obama said the private sector must take the lead in creating jobs as the economy recovers, with the government assisting by making sure workers have the necessary skills. “Government is not, and should not be, the main engine of job-creation in this country,” Obama said in his weekly address on the radio and Internet. “That’s the role of the private sector.” Obama said the government can work as a partner with businesses to enhance training and education for the jobs that are available. With the nation’s unemployment rate at 9.1% in May, up 0.1% from the previous month, the administration is focusing on measures that can encourage hiring. (Bloomberg)

US: Budget deficit in US narrowed to USD57.6bn in May
The US government posted a budget deficit of USD57.6bn in May, narrower than a year earlier, reflecting increasing tax revenue and a reduction in the estimated cost of the government’s financial industry bailout. In May 2010, the shortfall was USD135.9bn, according to the Treasury Department’s monthly budget statement, released in Washington. The economy has been adding jobs since October and corporate profits have climbed, leading to higher personal income and business tax collections. At the same time, the annual shortfall is projected to tie a record as spending also increases, based on data from the Congressional Budget Office. (Bloomberg)

U.S: Fed to expand annual capital exams to 35 largest banks to ensure they have an adequate buffer in an economic crisis. Bank holding companies with at least USD 50b in assets will be required to adopt "robust, forward-looking capital planning processes that account for their unique risks," the Fed said in a statement in Washington. (Source: Bloomberg)

U.S: May import prices unexpectedly rise on autos, clothing. The 0.2% MoM increase in the import-price index, its eighth consecutive gain, followed a revised 2.1% MoM climb in April. Costs advanced 12.5% YoY from May 2010, the biggest 12-month increase since September 2008. (Source: Bloomberg)

Japan: Producer prices rose for an eight month in May, pushed up by higher energy and raw material costs. Prices companies pay for energy and unfinished goods gained 2.2% YoY, after climbing 2.5% YoY in April, a Bank of Japan report showed. (Source: Bloomberg)

S. Korea: Bank of Korea raised interest rates for a third time this year to rein in inflation that has exceeded its target range and curb record household debt. Governor Kim Choong Soo boosted the benchmark seven-day repurchase rate to 3.25% from 3%, following quarter-percent increases in January and March, the central bank said in a statement in Seoul. (Source: Bloomberg)

Philippines: April export growth accelerated to a four-month high as rising sales of the nation's agriculture and mineral goods countered declining electronics shipments. Shipments abroad expanded 19.1% YoY in April to USD 4.3b after rising 4.1% YoY in March, the National Statistics Office said in Manila. (Source: Bloomberg)              

20110613 1005 Malaysia Corporate Related News.

KLCI chart reading :

correction range bound upside biased.

Bumi Armada plans to raise up to USD800m from IPO
Malaysian-based international offshore oil field services contractor Bumi Armada hopes to raise between USD700m and USD800m from its IPO plan. Its CEO, Hassan Basma, said it was now ranked number eight in world, looking at the number of floating production, storage and offloading (FSPO) vessels it operates. With the new FSPO that is going to start operation in August, he said Bumi Armada would make it to number six in the ranking. He mentioned that the IPO approval from the Securities Commission is expected sometime by the mid-June, and hopes to start producing the prospectus by end of the month. (Starbiz)

ADCB may sell stake in RHBCap to Aabar
Abu Dhabi Commerical Bank (ADCB), a bank partly owned by the Emirate’s government, is mulling the sale of its 25% stake in RHBCap to Aabar Investments. The bank told the Abu Dhabi bourse yesterday that it received the approval from Bank Negara to proceed with talks with Aabar on the matter. Aabar is majority owned by the Abu Dhabi government investment vehicle, International Petroleum Investment Corp. (BT)

Mutiara eyes RM1.2bn project along Jalan Sultan Ismail
Property developer Mutiara Goodyear Development is planning an estimated RM1.2bn commercial and residential project on the prime land it is acquiring from UDA Holdings. The 1.4ha freehold site near Sheraton Imperial Hotel along Jalan Sultan Ismail here is valued at RM215.5m. Mutiara executive chairman Hamidon Abdullah said the developer planned to build offices and apartments at a cost of some RM800m. (Financial Daily)

United U-Li selling three subsidiaries to French firm for RM200m
United U-Li Corp, a manufacturer of cable support systems and light fittings, is selling all its shares in three subsidiaries for RM200m to Legrand France, SA. The group was selling its entire stakes in United U-Li (M) SB, United U-Li Steel Service Centre SB and Cable-Tray Industries (M) SB. Managing director Datuk James Lee Yoon Wah mentioned that the group was selling three of seven subsidiaries and the sales only involved the businesses and machinery of the companies. (Starbiz)

HELP, Naza jointly set up auto college
HELP International Corporation and Naza Education SB have set up a joint venture company, Symphony Haven SB, to establish and operate a college that specializes in offering courses in automotive and transportation management. HELP said the focus would initially be on Malaysia, with a view to expanding to Asean countries. “The establishment of this automotive college is part of HELP's diversification plans to offer technical and vocational training for the nation,” it added. Both parties would share the responsibility of jointly establishing the joint venture, with each having a 50% equity shareholding. (StarBiz)

Gadang unit wins RM24m contract
Gadang Holding’s subsidiary Gadang Engineering (M) SB has received a contract worth RM23.9m from Syarikat Prasarana Negara to undertake civil construction at the Sungai Buloh Depot in relation to the Klang Valley mass rapid transport project. Gadang Engineering had accepted a letter of acceptance from SPNB to undertake the project, and that the contract was to be completed within eight months. (Starbiz)

Olympia sells Johor land for RM80m
Olympia Industries is disposing of 15.25 ha of freehold land in Johor Baru for RM80m cash to Adawan Development SB in order to reduce its debts. It said that the land was acquired in December 1989 and was an unconverted development land zoned for residential and commercial use located about 5km north-east of the Johor Baru city centre. The group said the land was one of several earmarked assets which had been identified as a significant divestment asset subsequent to the implementation of Olympia Industries’ restructuring scheme to meet its obligations under the said scheme. (Starbiz)

Singapore ready to sell more electricity to Malaysia
Singapore has signalled willingness to let its power generating firms sell electricity to neighbouring Malaysia but has not received any request to extend supply beyond 15 June. “In response to Tenaga Nasional's request, the Energy Market Authority (EMA) granted the approval for PowerSeraya Ltd to export electricity to Malaysia till 15 June 2011,” EMA said on Friday in reply to a Reuters query. (Starbiz)

PJI subsidiary bags RM10.6m sub-contract from UEM
PJI Holdings’ wholly-owned subsidiary P.J. Indah SB has secured a sub-contract worth RM10.6m from UEM Construction SB. The sub-contract is for the supply, install, testing and commissioning and maintenance of fire protection services at the main terminal building of the KL International Airport. PJI said its wholly-owned subsidiary will offer the services at Sectors S1, S2 and S3 of KLIA for a period of 43 weeks with the completion due 14 Feb 2012. (Starbiz)

PChem: Plans production ramp-up. Petronas Chemicals Group Bhd is going all out to grab a bigger market share of the world's petrochemical products. With this in mind, it also aims to become the third largest revenue contributor to parent Petroliam Nasional Bhd (Petronas) in the long term. (Source: Business Times)

E&O: Shareholding changes in the works at E&O. Eastern & Oriental Bhd (E&O) is likely to see some changes in its shareholding, which could even lead to a new name appearing at the helm of the company. It is learnt that some of the major shareholders are prepared to exit the company. (Source: The Edge Financial Weekly)

Petra Energy: To undertake private placement. Petra Energy Bhd may see a new shareholder as it is set to place out a 10% stake in the company as part of its fundraising efforts. (Source: The Edge Financial Weekly)

20110613 0959 Global Market Related News.

 DJIA chart reading : downside biased .

 Hang Seng chart reading : downside biased.

Asian Stocks Fall Amid Global Recovery Concern (Source: Bloomberg)
Asian stocks dropped, extending last week’s longest streak of weekly losses since October 2008 for the regional benchmark index, amid concern the global economy is slowing.

Shares drop for 7th day; euro under pressure
HONG KONG, June 10 (Reuters) - Asian stocks fell for a seventh consecutive day led by selling in technology counters on wariness about the broader economic outlook, while the euro held above one-week lows as worries about the euro-zone's debt problems outweighed a likely interest rate rise by the European Central Bank next month.   "Equity valuations are neither expensive nor cheap if you look at most markets in Asia today. I don't think valuations are flashing a buy or sell signal at this point in time," said Binay Chandgothia, chief investment officer at Principal Global Investors.

‘Perfect Storm’ May Threaten Global Economy: Roubini (Source: Bloomberg)
A “perfect storm” of fiscal woe in the U.S., a slowdown in China, European debt restructuring and stagnation in Japan may converge on the global economy, New York University professor Nouriel Roubini said. There’s a one-in-three chance the factors will combine to stunt growth from 2013, Roubini said in a June 11 interview in Singapore. Other possible outcomes are “anemic but okay” global growth or an “optimistic” scenario in which the expansion improves.

Debt Agreement in Congress Would Spur Flagging U.S. Economy, Lawmakers Say (Source: Bloomberg)
Congress could help improve the economic recovery by reaching a debt-reduction deal, lawmakers said on Sunday morning talk shows as they face an Aug. 2 deadline that risks sending the U.S. government into default. “I think that would help calm the markets and help us get to recovery,” Republican Representative Paul Ryan of Wisconsin, chairman of the House Budget Committee, said today on CBS’s “Face the Nation” program, referring to a budget deal that would control future U.S. deficits.

Retail Sales Probably Decreased in May (Source: Bloomberg)
Sales at retailers probably fell in May as Americans bought fewer cars and elevated gasoline costs restrained consumers, reports may show this week. The 0.5 percent drop in purchases, the first decline in 11 months, would follow a 0.5 percent gain in April, according to the median forecast of 62 economists surveyed by Bloomberg News ahead of Commerce Department data June 14. Other reports may show inflation eased and manufacturing expanded.

Treasury 10-Year Yields Hold Near Six-Month Low Before Retail Sales Data (Source: Bloomberg)
Treasury 10-year yields were six basis points from this year’s low before a report that economists say will show U.S. retail sales dropped for the first time in 11 months.

US economy at tipping point,double-dip risk-Shiller
NEW YORK, June 9 (Reuters) - Recent housing and employment data suggests the U.S. economy is at a tipping point where a double-dip recession is possible and home prices could have much further to fall, a veteran economist said on Thursday.
Robert Shiller said the recent uptick in unemployment is not yet enough of a sign as to which way the recovery is heading. But if unemployment continues to rise in the coming months, it could suggest another recession.

Japan April Machine Orders Fall 3.3% on Month (Source: Bloomberg)
Japan’s machinery orders fell for the first time in four months in April, an indication that companies are reluctant to spend after the March 11 earthquake and tsunami.

Japanese Stocks Decline Most in a Week as Toyota Forecasts 31% Profit Drop (Source: Bloomberg)
Japanese stocks declined the most in a week after Toyota Motor Corp. said profit will fall by 31 percent this year following March’s record earthquake and after machinery orders unexpectedly fell.

Bank of Korea surprises with rate rise, eyes inflation
SEOUL, June 10 (Reuters) - South Korea's central bank raised interest rates on Friday for the third time this year, surprising financial markets, as the government warned of rising inflation risks even as growth in Asia's fourth-largest economy cools.
The Bank of Korea raised its benchmark rate  by 25 basis points to 3.25 percent, playing down growing concerns about a slowing global economy that have persuaded three major central banks in Asia to hold rates steady this month.

Short Sales Climb to 8-Month High in Hong Kong (Source: Bloomberg)
Short selling in Hong Kong has risen to the highest level since September 2010 as concerns of slowing Chinese economic growth and further monetary-policy tightening intensify, according to a report from Data Explorers. Borrowed shares have risen to 12.2 percent of stock available for lending as of June 7, compared with 8.8 percent in January, Data Explorers, a New York-based research provider, wrote in a report June 9. The increase comes as Chinese companies listed in Hong Kong, Canada and the U.S. face pressure from short sellers amid allegations of lax corporate governance and fraud.

Greek Default Would Not Destabilize the Euro, Bundesbank’s Weidmann Says (Source: Bloomberg)
Bundesbank President Jens Weidmann raised the pressure on governments to agree to a Greek bailout without the European Central Bank taking part in easing the country’s debt burden, saying the euro can withstand a default. Weidmann said the ECB was unwilling to turn its emergency bond-buying program into a “lasting institution” and that Greece’s implementation of austerity measures and asset sales was crucial to securing the handout to prevent a default. He spoke in an interview with German newspaper Welt am Sonntag.

ECB and Germany May Be Forced to Compromise (Source: Bloomberg)
The confrontation between the European Central Bank and Germany over bailing out Greece risks causing so much damage that officials may be forced to compromise. “The balance of forces in the euro zone is a little like it was in the Cold War: both sides are brandishing deterrents that would be too horrendous to use,” said Philip Whyte, a senior research fellow at the Centre for European Reform in London. “It’s all going to turn on whether you can fiddle with debt maturities without calling it a credit event.”

Euro Trades Near Two-Week Low Versus Dollar on Greek Bailout Concerns (Source: Bloomberg)
The euro traded 0.3 percent from a two-week low against the dollar after Luxembourg’s Jean-Claude Juncker said a bailout for Greece must include “voluntary” investor participation and meet the approval of central bankers.

FOREX-Euro hit by uncertainty about Greek debt aid
LONDON, June 10 (Reuters) - The euro fell against the dollar on Friday and could extend its losses as worries over Greek debt return to centre stage while investors scale back expectations of the pace of European Central Bank interest rate hikes.
Investors received mixed messages about the progress of debt assistance to Greece, with Germany sticking to its demand that private investors contribute to a second bailout even after renewed ECB opposition to any investor participation that might be deemed involuntary. 

20110613 0955 Global Commodities Related News.

Corn (Source: CME)
US corn futures end mixed, retreating from early gains that sent July to a new all-time record for front-month corn. July surged as high as $7.99 on dwindling near-term supplies before prices retreated. Although USDA kept old crop end stocks at 730 million bushels Thursday, not all of that is "going to be available in the marketplace," as farmers think they'll get better prices later on, Tom Leffler of Leffler Commodities says. Deferred contracts slipped amid a stronger dollar and profit-taking. July CBOT corn ends up 1 1/2 cents to $7.87 while Dec corn closes down 1 1/2 cents to $7.12 1.2.

Wheat (Source: CME)
US wheat futures finished mixed, with soft red wheat traded in Chicago rallying on expectations for increased demand from livestock producers looking for cheaper feed ingredients to corn. Corn is trading at premium to wheat, reaching an all-time high in the process. Prices for wheat are normally higher than corn, and the divergence could lead to more wheat feeding. CBOT July wheat jumped 1.9% to $7.59 1/4 a bushel while KCBT July dropped 3 1/4c to $8.68 and MGE July fell 2% to $10.00.

Rice (Source: CME)
US rice futures end slightly lower in a correction from recent gains, as a stronger dollar pressures commodities generally. Prices had rallied Thursday after the USDA slashed production estimates thanks to bad weather in the US South. But world supplies of rice are considered ample. CBOT July rice ends down 4 1/2 cents to $14.89 1/2 per hundredweight.

Corn eases from record high, fundamentals strong
SYDNEY, June 10 (Reuters) - U.S. corn futures pulled back from record highs struck on Thursday when the U.S. government estimated U.S. and global stocks were likely to be tighter than the market had expected. "Corn stocks in 2011/12 are now expected to be tighter than the current season, implying that the current record high prices will need to persist for some time yet," Luke Mathews, an agricultural commodities strategist at Commonwealth Bank of Australia, said in a market report.

Global corn supply tightens as U.S. grows less
WASHINGTON, June 9 (Reuters) - Global corn supplies will be much tighter next year than forecast a month ago, the U.S. government said on Thursday as it unexpectedly cut its estimate for the U.S. crop and forecast a jump in demand from China.
Chicago corn futures briefly spiked to an all-time high after the U.S. Agriculture Department (USDA) said rains and floods prevented farmers from planting all the corn they had intended, cutting the likely size of the crop by 2 percent, an unusual revision just weeks ahead of its annual June survey.

Ageing farmers threaten Indonesian food security
KARAWANG, Indonesia, June 10 (Reuters Life!) - Indonesia, the world's fourth most populous nation, has committed itself to beefing up food security plans as a result.
It aims for self-sufficiency in rice by increasing output to 75.7 million tonnes by 2014 through improving yields and increasing crop areas in east Indonesia. The 2009 yield was around 50 million tonnes.

Russia ministries back grain export tariff-report
MOSCOW, June 10 (Reuters) - Russia's economy and agriculture ministries support a proposal by central bank governor Sergei Ignatyev to introduce a floating tariff on grain exports, a source at the agriculture ministry told Kommersant newspaper.
Ignatyev mooted the proposal, which would be modelled on the country's floating oil export duty, earlier this month in order to curb domestic prices when Russia returns to the export market in July.

Ukraine grain exports jump in June 1-8
KIEV, June 10 (Reuters) - Ukraine boosted its grain exports to 159,400 tonnes in June 1-8 from 32,700 in the same period in May after the government removed export restrictions, ProAgro agriculture consultancy said on Friday.
ProAgro said Ukraine had exported 101,300 tonnes of maize and 58,100 tonnes of wheat so far this month.

China floods kill 34 in drought-hit provinces
BEIJING, June 10 (Reuters) - Torrential rain in two drought-stricken central China provinces triggered landslides and brought down houses, killing at least 34 people and leaving 30 missing, state media said on Friday.
The two provinces were among the worst hit by a severe drought in recent months that hit millions of hectares of farmland in central and southern China along the middle and lower reaches of the Yangtze river.

UK Declares Drought In Some Parts; Crops Yields Fall (Source: CME)
Parts of the U.K. are now in the grip of drought and the affected zone could spread if areas of central and south-eastern England do not receive rainfall soon, the U.K.'s farm ministry and Environment Agency said. Parts of Lincolnshire, Cambridgeshire, Bedfordshire, Northamptonshire and western Norfolk are all suffering following the driest spring on record in south-east and central southern England, with parts of the Midlands, south-west and south-east of England in a "near-drought" state. "Water companies are confident that supplies are high enough so that widespread restrictions to the public are unlikely," said Environment Secretary Caroline Spelman. Farmers, water companies and environment groups will discuss ways to conserve water usage and another meeting is planned towards the end of the month, a spokeswoman for the agency said. Worst-hit East Anglia accounts for 53% of the U.K.'s sugar beet output, 17% of wheat and 13% of barley output.
Forecaster WeatherEdge Ltd. warned wheat yields could drop as much as 15% in 2011-12 due to the dry weather, putting pressure on already near-record-high prices for U.K. feed wheat. "If the dry weather continues, yields could be severely affected in the driest regions," said the Home Grown Cereals Authority. The news comes as farmers in Western Europe's largest wheat growers, France and Germany, are in a state of crisis. France will make available around EUR1 billion of aid through a variety of mechanisms to help farmers suffering from the impact of drought, French Prime Minister Francois Fillon said Thursday. Across the Atlantic, U.S. farmers' production hopes are diminishing due to extremes of dryness and rainfall in key growing regions, causing fears of a return to supply deficit in world wheat markets in the 2011-12 crop. In the U.K., the situation is less severe, with widespread hosepipe bans looking unlikely at this stage.
But the head of communications for Severn Trent Water Rob Salmon said the company may bring in restrictions in some areas "unless we see a return to seasonal average rainfall." "Low river flows also impact on business, as it abstracts millions of gallons from rivers on a daily basis and we need to ensure this is sustainable," said Paul Leinster, Environment Agency's chief executive. Some analysts are drawing comparison with the drought of 1976, when the U.K. government imposed a widespread ban on water use after a dry winter and spring sapped groundwater supplies. Crop losses amounted to an estimated GBP500 million that year, sending food prices surging 12%. U.K. wheat prices have surged 15% on the back of the drought and analysts forecast European prices may top the three-year highs reached in February if the drought continues to hurt output.
Chief economist at the U.K.'s National Farmers Union Phil Bicknell said losses are unlikely to rise to that kind of level this year as the problems are much more localized. But he added that the broader picture of drought in Europe and problems in the U.S. would put pressure on U.K. prices going forward. "As an industry we're increasingly adapting to our environment but to do that we need investment and to do that we need a profitable farming industry," he said.

Philippine group sees no need for extra feed wheat imports
MANILA, June 10 (Reuters) - Philippine feed millers have secured deals for the supply of 600,000 tonnes of feed wheat early this year and are not inclined to buy more for the rest of 2011 given higher output and stable local corn price, an industry official said.
The Southeast Asian country's feed wheat purchases this year could be limited to just about two-thirds of the 2010 volume of 900,000 tonnes, Norman Ramos, president of the Philippine Association of Feed Millers Inc (PAFMI), told reporters late on Thursday.

China feed mills shifting to more cheap wheat from corn
BEIJING, June 10 (Reuters) - China's feed mills are using more cheap wheat as a substitute for corn, with wheat prices now 9.3 percent below corn as the wheat harvest nears, traders said on Friday.
Chinese farmers have finished harvesting half their wheat crop this week and the government has said it expects a bumper harvest.

India On Track For Bumper Rice Output With Key States Eyeing Jump (Source: CME)
Two of India's top rice-producing regions are expecting a jump in output during the main summer season with the timely arrival of seasonal monsoon rains, putting the country on track for a bumper output of the grain. While the southern state of Andhra Pradesh is expecting its rice output to rise by 21% to 9.1 million metric tons, the northern state of Uttar Pradesh expects production of the grain staple to climb to an all-time high of 13.5 million tons. "Rice Production is going to be on the higher side with a normal monsoon," M. Sudhakar, special secretary of agriculture, Andhra Pradesh government, said. He said the rice cultivation area is expected to increase only marginally during this summer season to 2.95 million hectares, but better distribution of fertilizers, hybrid seeds as well as rains will all help boost the output of India's top rice producer.
Higher rice production in the two states will be critical to India achieving its target of harvesting around 100 million tons of rice during 2011-12 as the country gears up to introduce a food security law that guarantees cheap grains to nearly 70% of the population. India's rice output is estimated at 94.11 million tons during the crop year ending June. Rice sowing starts with the monsoon's arrival, which has covered the southern state of Andhra Pradesh after reaching India's mainland two days before the forecast May 31. The rains have since maintained their progress, but they usually reach the northern state of Uttar Pradesh by the end of June.

India raises rice purchase price 8 pct
NEW DELHI, June 9 (Reuters) - India raised the support price at which it buys rice from farmers by around eight percent, the government said in a statement on Thursday, a move aimed at encouraging more planting of the food crop during the current monsoon season.
India already has bulging stocks of rice after a bumper harvest last year and expectations are for at least the same amount of acreage to be planted in the coming crop year as for 2010/11.

Australian 2011-12 Wheat Crop Outlook Upbeat (Source: CME)
Australia's winter cropping season has started well in the major growing regions and big crops are forecast, although the winter rainfall outlook for Western Australia--usually the nation's largest grain producer--suggests below-average falls are likely there. In South Australia, Queensland, New South Wales and Victoria states, "conditions remain highly favorable for above-average yields" while the decay of the La Nina climate event in the Pacific "augurs well for a high quality grain harvest" late in 2011, agricultural lender Rabobank Australia. The U.S. Department of Agriculture added 500,000 metric tons to its Australian wheat production forecast for this crop year to 25.0 million tons, which is consistent with other projections. The government's chief commodities forecaster, the Australian Bureau of Agricultural & Resource Economics & Sciences, estimates output at 24.3 million tons this crop year ending March 31, which if achieved would be down 7.6% from a year ago.
Australia is usually among the world's top wheat exporters, along with the U.S., Russia, Canada and Europe. After annual domestic demand of around 6.0 million tons is met, the balance is available for exports. Australian output last crop year was crimped by a severe drought in Western Australia, where output fell to 4.7 million tons from 8.1 million tons the previous year. But Western Australia received drought-breaking rains in May, and Rabobank projects output will rise to 7.6 million tons this crop year, a forecast that it said seems more likely now than even just a few weeks ago. While the government's Bureau of Meteorology expects winter rainfall to be below average in winter, the timing of rainfall during the growing season will be critical, Rabobank reported.

China Corn Storage Facilities "Well Under Capacity" - USGC (Source: CME)
Corn is competing with fruits, vegetables and urbanization for land in China this year, while corn storage facilities appeared to be under-used, the U.S. Grains Council in a new report. The report, concluded after a recent study trip to China by a council team, suggests corn stock levels remained relatively low. "We had the opportunity to visit some private corn storage facilities, which we felt were well under capacity," the report quoted Ken Kindler of Dow AgriSciences LLC, adding there was no certainty on measurements of state corn stock levels. "Farmers sold most of their 2010 production at harvest." China emerged last year as a net corn importer, and analysts expect the import trend to rise given the speed and scale of China's demand for commodities. Still, China's corn production this year may rise. Corn planting acreage for 2011 is expected to increase marginally, as farmers switched to corn after a price rally in 2010, the USGC team said.
But the council noted that "there is also increased competition for acres from fruits and vegetables, particularly near urban areas. Some land was unplanted and attributed to increased urban encroachment." In the major producing provinces of Heilongjiang and Jilin, the council team noted that corn emergence was behind normal levels due to rainy weather and low temperatures, and that germination was "spotty" in some locations.

Coffee, cocoa rise, sugar steady, firm dollar weighs
LONDON, June 10 (Reuters) - ICE arabica coffee futures firmed early with upside capped by Brazil's harvest and a stronger dollar, while cocoa edged up, with gains limited by a steady flow of supplies from top producer Ivory Coast. Liffe white sugar futures were little changed around two-month highs, underpinned by tight supplies during a period of high demand before Ramadan in August.

Crude Oil Declines for a Second Day on U.S., China Economic Growth Concern (Source: Bloomberg)
Oil dropped for a second day in New York ahead of reports that may show slowing economic growth in the U.S. and China, curbing fuel demand in the world’s two largest crude consumers. Future slumped as much as 0.6 percent, extending declines after the biggest single-session drop in four weeks on June 10. Sales at U.S. retailers probably fell in May for the first time in 11 months as car buying eased and elevated gasoline costs restrained consumers. A report tomorrow may show China’s industrial production slowed.

Essar to Buy More Indonesian, Australian Resources to Meet India’s Demand (Source: Bloomberg)
Essar Group plans to acquire more coal and iron ore assets in Indonesia, Australia and Africa as it seeks to boost supply to meet domestic Indian needs, Chief Executive Officer Prashant Ruia said. “We’re looking at investing overseas, including in Indonesia, Australia and Africa to access natural resources,” Ruia said in a Bloomberg TV interview at the World Economic Forum on East Asia in Jakarta yesterday. “Coal and iron ore are two major possibilities and, going forward, oil and gas.”

Europe metals premiums steady, Chinese demand eyed
LONDON, June 10 (Reuters) - Premiums for physical metals in Europe remained little changed in the past week, with traders eyeing the return of top consumer China.
The premium for copper in Rotterdam , paid above the London Metal Exchange (LME) cash price , was at around $75-85 a tonne versus $70-80 in late May, traders said.

Chinese aluminium prices seen capped in June-July by new capacity
HONG KONG, June 9 (Reuters) - Chinese aluminium prices may be capped by record production and weaker demand over the coming two months as new capacity comes online, which could lead to a boost semi-finished product exports, industry sources said on Thursday.
Monthly production in China, the world's top producer and consumer of primary aluminium, is expected to reach fresh record highs in June and July as an estimated 1.5 million tonnes of new annual capacity is slated to come on stream.

China May copper imports fall 3 pct, seen up in June
HONG KONG, June 10 (Reuters) - China's imports of unwrought copper and semi-finished copper products dropped 3 percent on the month in May because of high stocks, but traders said extra bookings placed in May will raise June arrivals. 
High bonded stocks in Shanghai limited China's imports of refined copper, the most popular form of the metal in the Chinese and international markets, missing analyst forecasts for a small increase.

US copper imports up despite weaker housing sector
NEW YORK, June 9 (Reuters) - Inbound shipments of copper into the United States rose for a second-straight month in April to their highest levels since March 2009, as fragments of the economy continued to thrive even as housing weakened further.
Data from the U.S. international Trade Commission on Thursday showed April copper imports climbed to 73,061 tonnes from 66,166 tonnes in March, to stand at their highest since March 2009, when imports came to 79,975 tonnes.

Strike nears end at Chile copper mine, output rises
SANTIAGO, June 9 (Reuters) - Output should return to normal in days at the world's No. 5 copper mine, El Teniente in Chile, after thousands of contractors abandoned a 16-day strike that seems near its end, the company said.
Staff workers also decided to return to work on Friday after strikers began wage talks with their employers to resolve a sometimes violent 16-day walkout that is losing strength.

China's iron ore imports up 0.8 pct in May, June may fall
SHANGHAI, June 10 (Reuters) - China's iron ore imports rose 0.8 percent to 53.3 million tonnes in May from the previous month, official data from China's customs authority showed on Friday.  
Chinese steel mills, which usually consume two-thirds of seaborne iron ore, have raced to expand production since this year, despite Beijing's tightening moves to tame inflation and curb the hot property market.

METALS-Copper down after Chinese May imports fall
LONDON, June 10 (Reuters) - Copper dipped on Friday after Chinese trade data showed a surprising fall in copper imports last month, but expectations that June inflows could pick up limited losses.
Three-month copper on the London Metal Exchange  was down 0.5 percent at $9,010 a tonne at 0954 GMT, after closing at $9,055 on Thursday.

PRECIOUS-Gold holds near $1,540/oz as debt crisis simmers
LONDON, June 10 (Reuters) - Gold prices retreated a touch on Friday, under pressure from a firmer dollar, but concerns over the euro zone debt crisis kept prices firmly underpinned as they boosted the metal's haven appeal.
Spot gold  was bid at $1,540.11 an ounce at 1137 GMT, against $1,543.60 late in New York on Thursday. U.S. gold futures for August delivery  eased $1.30 to $1,541.40.

20110613 0952 Soy Oil & Palm Oil Related News.

Soybeans (Source: CME)
US soybean futures end lower, continuing to correct from recent highs on government data showing less threatening year-end supplies while there was also broader-based commodity weakness. Traders trimmed premium from the market as futures lacked fresh support to justify higher prices, analysts said, nevermind the weekend approaching and the dollar rising. CBOT July soybeans end down 0.5% at $13.87 1/4 a bushel.

Soybean Meal/Oil (Source: CME)
Soymeal futures continued to garner support from firm cash prices amid the risk of supply disruptions due to flooding on the Missouri River while soyoil stumbled, succumbing to spillover weakness in soybeans and crude-oil futures. CBOT July soymeal ended up 0.1% at $373.30/short ton while July soyoil settled down 1% at 56.85c/pound.

Palm oil dips as glut of data drags prices lower
JAKARTA, June 10 (Reuters) - Malaysian palm oil prices eased flirting with one-month lows on a flurry of bearish data that could lead to further losses later in the session.  "It's quite bearish and slightly higher than many people's expectations," said one trader. "It's a bit on the high side and will pressure prices."  "USDA was more on the bearish side," he added. "People were expecting a higher stocks forecast ... there could be some short covering and prices may go down further." 

India's May vegoil imports seen up as local supply falls
NEW DELHI, June 10 (Reuters) - India's vegetable oil imports may have risen by 37 percent in May, the second straight monthly rise, as local supply dropped on depleting oilseeds stocks ahead of the summer planting season, a trend that is likely to continue next month, a Reuters survey showed on Friday.
Palm oil imports, which account for the bulk of India's cooking purchases, are expected to have risen 50 percent in May over the previous month, according to a survey of eight traders.

Malaysia's palm oil stocks at 16-month high
KUALA LUMPUR, June 10 (Reuters) - Malaysia's May palm oil stocks rose nearly 15 percent to their highest in 16 months as production overtook exports, potentially weighing on benchmark futures.
May output rose 13.7 percent to 1.74 million tonnes from April as yield continued to soar after two years of unfavourable crop conditions.

China imported 4.56 mln tonnes of soy in May - Customs
BEIJING, June 10 (Reuters) - China, the world's largest soy buyer, imported 4.56 million tonnes of soybeans in May, up 17.5 percent from 3.88 million tonnes in April, figures from the General Administration of Customs of China showed.
Imports of vegetable oils in May were 390,000 tonnes, down 20.4 percent from the previous month.

Argentina soy output seen at 50.3 mln T-exchange
BUENOS AIRES, June 9 (Reuters) - Argentina's 2010/11 soy output is seen totaling 50.3 million tonnes, up slightly from the 50.2 million tonnes forecast last month, the Rosario grains exchange said on Thursday.
Argentina is the world's No. 3 soybean exporter and the biggest soymeal and soyoil supplier. The Agriculture Ministry expects this season's soy crop, which farmers have nearly finished harvesting, at 50.4 million tonnes.