Corn falls 0.4 pct after strong rally, harvest weighs
SINGAPORE, Oct 13 (Reuters) - Chicago corn futures fell 0.4 percent while soybeans edged lower, snapping a four-day winning streak as the record pace of the U.S. harvest and forecasts of crop-friendly weather in Brazil weighed on the markets.
"It is certainly going to be difficult for corn to continue at the breakneck speed that we have seen in the past few sessions," said Luke Mathews, commodity strategist at Commonwealth Bank of Australia.
China Sept soy imports at 4.64 mln T-Customs
BEIJING, Oct 13 (Reuters) - China, the world's largest soy buyer, imported 4.63 million tonnes of the oilseed in September, down 2.7 percent from August, but a rise of 68.5 percent from a year-ago period, official Customs figures showed on Wednesday.
The September figure brings China's total imports in 2009/2010 (Oct/Sept) marketing year exceeding 50 million tonnes, a record volume or a rise of 22 percent from the previous year following an ongoing expansion of the crushing industry.
Soy product futures ended higher, bouncing in unison with soybeans. Tighter global supply outlooks for soybeans fueled the markets price strength, with both soyoil and soymeal rising near the previous day's session highs near the close. December soyoil settled 0.60 cents or 1.3% higher at 46.95 cents per pound. December soymeal ended $6.00 or 1.8% higher at $333.10 per short ton.(Source: CME)
Cargill 1Q Earnings Up 68% On Volatile Commodity Trade (Source: CME)
Cargill Inc. said its fiscal first-quarter earnings jumped 68% as the agribusiness giant benefited from volatile commodity markets. The company reported net earnings of $883 million in the quarter ended Aug. 31, up from $525 million during the same period a year ago. Excluding Mosaic Co., a fertilizer producer in which Cargill owns a two-thirds stake, the company earned $693 million, up 51% from $458 million a year ago. The Minneapolis-based company said first-quarter revenue rose 6% to $27.8 billion.
Chairman and Chief Executive Greg Page said the results were led by its food ingredients and commodity trading and processing segments, which were helped by volatility across the agricultural commodity sector. "The change put Cargill's global breadth, trading and risk management skills more acutely into play," Page said. A severe drought in Russia this summer, which decimated the wheat crop there and prompted an export ban, sent grain prices surging during the summer. Analysts say the export ban has been a boost to grain traders and merchandisers with a global reach, as customers have to look elsewhere to source supplies.
Concerns about a disappointing U.S. corn crop have added to the volatile atmosphere in global grain markets. In times of volatility, large grain merchandisers such as Cargill, with a global presence and ample supplies in storage, are able to increase sales by serving buyers who are looking globally for the best deal on grain prices and transportation costs. Cargill, the largest private U.S. company by sales, is one of the world's largest commodity processors and traders, with other activities ranging from food ingredients to financial services and steel-making. The company said its origination, or grain-sourcing, as well as its processing results "rose significantly" in the quarter. Cargill processes grain into ethanol as well as products used in food and livestock feed.
Argentina Soyoil Exporters View End To China Spat With Wary Eye (Source: CME)
Argentina's soyoil exporters are cautiously optimistic that China is poised to resume its purchases of soyoil, but they are waiting to see an actual sale go through before celebrating an end to the six-month old trade dispute. An executive at one of Argentina's leading grain and vegetable oil said he is waiting to "see it to believe it." In April, China--the world's largest importer of the edible oil--blocked imports from Argentine--the largest exporter--citing purity standards. But many saw the move as retaliation for a host of anti-dumping duties imposed by Argentina on imported Chinese goods. Fueling scepticism over the resumption of soyoil sales is the fact that there seems to have been no progress in resolving the underlying conflict over trade barriers. In fact, Argentina has expanded the number of Chinese products hit by anti-dumping penalties in recent months.
Despite the tension, the Chinese appear to be more concerned with their domestic food prices. China is facing high inflation and Argentine soyoil is cheaper than what it is now buying from the U.S. and Brazil, said Ricardo Baccarin, vice president at local brokerage house Panagricola. A senior trader with a large Chinese grain buyer said Tuesday that China's government is clearing new soyoil imports from Argentina, although no purchases have taken place yet. China's Ministry of Commerce would support the resumption of soyoil imports from Argentina as long as there are no quality concerns, said Chen Rongkai, a ministry media official. Argentine President Cristina Fernandez celebrated the news in a twitter post on Tuesday. "If it wasn't enough, China is buying oil again," Fernandez wrote. Agriculture Minister Julian Dominguez told state news agency Telam on Monday there were signs that China would allow shipments to resume, although a foreign ministry spokesman on Tuesday declined to comment.
A resumption of sales to China would be a boon to Argentina's farmers, who were slow to sell this season and still have significant soybean stocks remaining, Panagricola's Baccarin said.
Farm Belt Bounces Back (Source: CME)
Major agricultural commodities continued their extended run-up in price, underscoring how much of America's farm belt is booming even as the overall economy continues to struggle. Contracts for the delivery of corn and soybeans into mid-2011 jumped Monday by 5% and 2%, respectively, after rising their daily permissible limits on Friday, when the U.S. Department of Agriculture sliced production estimates by small percentages. Cash cotton prices rose 3.3% Monday after a 3.9% gain Friday. They are 86% higher than a year ago. For many crops, prices are climbing even as big harvests pile up, a rare combination. Farmland values are up while those for some other kinds of real estate languish. Debt on the farm is manageable. Incomes are rising. And trade, of which many Americans are growing wary, is for agriculture a boon. Asia's economic vigor and appetites make the farm sector's reliance on exports -- once thought a vulnerability in some quarters -- a plus today.
"The farm economy is coming out of the recession far faster than the general economy," said Don Carson, a senior analyst at Susquehanna Financial Group, New York. Overall, the USDA projects net farm income to climb 24% this year to $77.1 billion, the fourth highest ever. In September, farmers were being paid 62% more for hogs than a year earlier, and 32% more for milk. The higher prices probably won't sting consumers at the dinner table as much as did a crop-price surge in 2008, when the consumer price index for food jumped 5.5%. With unemployment high and shoppers frugal, food executives are leery of trying to pass higher costs on. The USDA expects retail food prices to rise 0.5% to 1.5% this year, which would be the least since 1992, though some economists see these prices climbing 3% to 4% next year.
For taxpayers, higher commodity prices mean the government's cost of farm subsidies this year will fall to around $12 billion, about half the level in years when prices were much below targets set by Congress. Farmers this year are reaping about $4.8 billion in direct payments that aren't tied to market prices, as well as checks for such things as weather-related disasters and a land-idling conservation program. Growers' improved lot is rippling out to other industries. The boom is mending even America's tattered cotton belt, and that means long-stressed cotton farmers can buy new machinery. Hurst Farm Supply near Lubbock, Texas says sales are up 20% this year.
Corn stays near 2-yr top, soybeans catching up
SINGAPORE, Oct 12 (Reuters) - U.S. corn futures rose 1.1 percent on Tuesday, and stayed near two-year highs that followed a frenzied rally in the past two sessions after the United States painted a bleak supply outlook.
"I think it's drawing breath a little bit," Brett Cooper, senior manager for markets at FCStone Australia, said of Tuesday's corn trading.
China soyoil off 2-year highs on govt lifting import ban
KUALA LUMPUR, Oct 12 (Reuters) - China's soyoil futures hovered below two-year highs hit earlier on Tuesday as news of the government lifting a ban on Argentina soyoil partly offset the bullish soybean supply scenario.
"The market's cooling down compared to yesterday on concerns over the possibility that the government will release state reserves to cap vegetable oils prices," said Zhang Juan Cong, a vegetable oil analyst in China's Southern city of Hangzhou.
Wilmar says no major impact from moratorium
SINGAPORE/KUALA LUMPUR, Oct 12 (Reuters) - Wilmar International, the world's No.1 palm oil firm, expects Indonesia's proposed two-year ban on clearing forests to have a limited impact on its operations as land available for oil palm estates is ample.
Singapore-listed Wilmar's stand run counter to many palm oil and mining firms who fear the moratorium -- part of a $1 billion deal with Norway aimed at fighting deforestation and carbon emissions -- will curb expansion and future earnings.
China MofCom lifts Oct soy import estimate to 4.1 mln T
BEIJING, Oct 12 (Reuters) - China's commerce ministry has revised upwards its estimate for October soy imports to 4.15 million tonnes, even with its estimate for September.
The figures are both higher than imports of 2.7 million and 2.5 million tonnes, respectuvely, from a year earlier, according to official Customs data.
Ukraine to cut 10/11 sunoil exports - analyst
KIEV, Oct 12 (Reuters) - Ukraine, the world's major sunflower oil exporter, is likely to reduce its sunoil exports to 2.43 million tonnes in 2010/11 from 2.65 million a season earlier due to a lower seed quality, an analyst said on Tuesday.
UkrAgroConsult agriculture consultancy said in a report that drought, which hit the Black Sea region this summer, had also reduced Ukrainian sunflower seed harvest despite an increase in the sowing area.
China to resume soyoil imports from Argentina -traders
BEIJING, Oct 12 (Reuters) - China will resume soyoil imports from Argentina, the world's largest supplier, after a six-month de facto ban, traders told Reuters on Tuesday.
The lifting of the ban was seen by traders as a political gesture and large imports may not come in immediately because of unattractive prices and less supplies available from the South American supplier.
