Brazil soy belt gets rain, not right kind yet-Somar
SAO PAULO, Oct 26 (Reuters) - Some areas of Brazil's No. 1 soybean producing state Mato Grosso have seen good rainfall in October but others have not, which highlights one of the problems that La Nina is likely to cause for the grain crop.
Private meteorologists Somar said farmers in Mato Grosso will have to wait until Nov. 6 but more widespread rains are on the way. Several producers in the state are about a month or so behind in planting due to the drier weather.
China soy crush output to top 95 mln T 2010/2011-CNGOIC
BEIJING, Oct 27 (Reuters) - China will add 11 million tonnes of new soy crush capacity in 2010/2011 (Oct/Sept), with total crushing capacity to top 95 million tonnes annually, said the China National Grain and Oils Information Centre (CNGOIC).
The capacity expansion has boosted China's increase of soy imports,the centre said in a report on its website (www.grain.gov.cn).
Brazil 2011 cotton output hit record -sector
BRASILIA, Oct 26 (Reuters) - Brazil's 2011 cotton harvest could achieve record output of 1.7 million tonnes in 2011, sector sources said, a leap of nearly 50 percent from this year as prices which hit a new high on Tuesday, motivate growers.
"International prices are spectacular ... The local market price is good. Production costs are stabilized ... Cotton is more profitable than soy," said Sergio De Marco, head of a government-industry cotton group that meets regularly.
Soy slips from 14-month top on dollar, wheat steady
SINGAPORE, Oct 27 (Reuters) - Chicago soy futures fell 0.8 percent, after hitting a new 14-month top, while corn lost half a percent as a strong dollar weighed on commodity markets.
"There has been relative move in the U.S. dollar across the board, so you are seeing the dollar play in commodities," said said Jonathan Barratt, managing director at Commodity Broking Services in Sydney.
Soy product futures inched higher, recovering from initial losses in step with a bounce in soybean futures. Solid underlying demand for the products helped keep a floor beneath prices as well, analysts said. December soyoil settled 0.06 cents, or 0.1%, higher at 49.53 cents a pound. December soymeal ended $0.90, or 0.3%, higher at $335.50 a short ton. (Source : CME)
Rabobank Raises CBOT Soybean Price Forecast On China Demand (Source : CME)
Rabobank Tuesday raised its forecast for bellwether Chicago soybean futures due to strong demand in China. Rabobank increased its average forecast for Chicago Board of Trade nearby-month futures in the January-March period next year by 23% to $12.75 a bushel. It raised the forecast for the current quarter to $11.75/bushel from $10.50/bushel. "Global soybean demand remains exceptionally robust and even with prices at current levels, there is no real evidence of demand rationing," Rabobank said in a monthly report. A combination of healthy crush margins and record export bookings indicates that China's soybean imports in the year to Sept. 30, 2011 are likely to exceed the 55 million tons currently forecast by the U.S. Department of Agriculture.
China is the world's largest importer of soybeans, with imports jumping to 50 million metric tons last year from 41 million tons the previous year. The USDA is understating global demand, Rabobank said. It said China is the primary driver for this demand, with a 60% share in the global soybean trade. Rabobank also raised its average CBOT corn futures forecast for next quarter to $5.80/bushel from $5.25/bushel, and for this quarter to $5.50/bushel from $5.25/bushel.
USDA Sticks To Tame Food-Price Inflation Outlook (Source : CME)
The Agriculture Department is standing by its forecast for unusually tame food-price inflation this year but warned that the broad rally in farm commodity prices since midsummer will take a bigger bite out of consumers' wallets next year. In its monthly food-price inflation forecast released Monday, the USDA stuck with the prediction it first made in late August that the government's widely followed consumer-price index for food will rise between 0.5% and 1.5% this year, which would be the smallest increase since 1992. The USDA also left unchanged its forecast for retail food prices to climb by a more typical rate of between 2% and 3% in 2011. But Ephraim Leibtag, the USDA economist responsible for the forecast, said surging prices of commodities such as corn and wheat are increasing the odds that the 2011 food inflation rate will be at the high end of his forecast range.
"I wouldn't be shocked if we got to 3% if the current conditions continue," Mr. Leibtag said. Forecasting the food inflation rate is unusually difficult this year. Agricultural commodity prices are booming even though the U.S. economy is weak. Many executives in the food manufacturing and supermarket sectors are nervous about passing along all of their higher ingredient costs to consumers who seem willing to shop around for bargains. The prices farmers are being paid for everything from corn and wheat to hogs and milk have soared this year. U.S. farm exports are surging amid strong demand from emerging economies such as China, which are recovering from the global recession far faster than the developed world. At the same time, supplies of U.S. commodities such as beef and pork are tight in the wake of output cuts on U.S. farms during the recession. Compared with a year ago, the price of Texas steers is up 19%, soft red wheat is up 82%, butter 74% and corn 42%.
Last week, some major food brands began signaling their intent to raise prices. General Mills Inc. said it would increase prices in November on a quarter of its breakfast cereals, and fast-food giant McDonald's Corp. said it would raise menu prices. But other players in the food sector are still cutting prices to satisfy recession-weary consumers. Last week, supermarket chain Supervalu Inc. cut its earnings forecast amid continued price-cutting by rivals. Economists say high unemployment is casting a big shadow over food prices. Not only is it making shoppers more price-sensitive, it is helping to keep a lid on labor costs, which takes some pressure off food manufacturers to raise prices.
Shaken Grain Industry Pushes USDA On Recent Cuts In Crop Reports (Source : CME)
U.S. agriculture officials faced sharp questions from a grain industry shaken by dramatic swings in recent government crop estimates. More than 100 people including farmers, grain traders and executives from commercial grain companies attended the U.S. Department of Agriculture annual data users' meeting. The unprecedented turnout was driven by a surprisingly sharp cut by the agency in its corn crop estimates earlier this month. The change sent futures surging and further undermined confidence in the agency's closely-followed forecasts. "This room today is expressing concern about further cuts down the road in the U.S. corn crop," said Rich Feltes, an analyst for brokerage firm R.J. O'Brien, to USDA officials. Those at the meeting criticized the sharply reduced corn-harvest estimate, issued in a monthly report Oct. 8, saying the USDA should have detected weakened crop yields earlier in the season. The U.S. corn crop developed earlier than usual this year due to early planting and warm weather.
Attendees attempted to gauge the potential for another shock, asking a top USDA official how much of the government's sample corn fields had been harvested before the Oct. 8 report. Nearly 91% of USDA's sample corn plots had been harvested ahead of the October report, far greater than earlier reports, said Joseph Prusacki, director of statistics for USDA's National Agricultural Statistics Service. Prusacki reiterated the sharp cut in corn output reflected problems in estimating the average weight of corn kernels. The actual weight came in lower than the estimated weight used in earlier reports, helping to drive the sharp cut. "Until we get real grain weights, it's very difficult to get a handle on the size of the crop," said Prusacki, who cited the grain-weight issue in an interview last week with Dow Jones Newswires. Besides estimates, the USDA uses actual field visits and farmer surveys to determine its harvest estimates.
USDA officials said prior to the October report farmers may have mistakenly thought the crop would turn out better than it did and reported that way on their surveys. "Farmers have been a little bit slower to respond to the lower yields," said Lance Honig, chief of the crops branch for USDA's statistics service. A second issued raised at the meeting were the reasons behind a larger-than-expected estimate for corn supplies in storage. One concern had been the inclusion of corn from the current harvest in those estimates. The storage report is only supposed to include corn from previous harvests. Prusacki said the department reviewed its data to ensure it did not include corn from the current harvest. It was "possible" for fresh corn to slip into the data, but officials do "everything we can" to prevent it, he said. The larger-than-expected September supply estimate, which drove a sharp drop in prices after its release, followed a smaller-than-expected supply estimate in June that sent prices soaring.
The estimates are issued quarterly.
Corn dips on profit-taking, weather woes support wheat
SINGAPORE, Oct 26 (Reuters) - U.S. corn futures slipped as investors booked profit after a 1.6 percent gain in the previous session, while wheat ticked higher as poor rains in U.S. winter crop areas supported the market.
"There is certainly unease at the growing strength of La Nina," said Garry Booth, a trader at MF Global Australia.
USDA defends US corn stocks data at data meeting
CHICAGO, Oct 25 (Reuters) - U.S. Department of Agriculture officials on Monday stood by their last two quarterly U.S. corn inventory reports but said the poor quality of the 2009 harvest may have played a role in large swings in the figures.
The inventory reports, along with an Oct. 8 corn yield estimate that came in well below trade expectations, whip-sawed the Chicago Board of Trade grain markets, sparking pointed questions at USDA's annual data meeting Monday in Chicago.
Palm oil retreats as dollar firms
KUALA LUMPUR, Oct 26 (Reuters) - Malaysian palm oil futures eased on profit taking due to a firmer dollar, but losses were limited by strong Chinese demand for soybeans for crushing into vegetable oils.
"Currently we're getting all support from the U.S. soy complex," said a trader in Kuala Lumpur. "The market needs factors like very strong export figures and fear of lower stocks to reach 3,100 ringgit."
New Brazil soy crop seen 1 pct below record-Safras
SAO PAULO, Oct 25 (Reuters) - Brazil's 2010/11 soybean crop that farmers began planting a few weeks ago is seen at 67.69 million tonnes, down 1 percent from the record 68.1 million tonnes harvested last season, analysts Safras e Mercado said.
In the analyst's second forecast of the new crop, Safras said it had raise its new outlook from the July view of 67.18 million tonnes due to a slightly greater planted area than previously expected.
U.S. corn, soy harvests remain on record pace
CHICAGO, Oct 25 (Reuters) - U.S. farmers kept up the record pace in this year's corn and soybean harvests, according to U.S. Agriculture Department data released on Monday.
Corn harvest was 83 percent complete as of Oct. 24, up from 20 percent a year ago and well above the five-year average of 49 percent.
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