Corn (Source: CME)
US corn futures end mixed, climbing late despite outside market pressure as weather forecasts fuel worry about the crop. Analysts say midday weather forecasts were supportive, reinforcing that next week will be very hot and dry across much of the corn belt. Traders fear that the heat will hurt yields and exacerbate a tight supply outlook. The market faced pressure from falling crude oil and equities amid pessimism about the economy. September CBOT corn gained 4c to $6.90 3/4 per bushel while December slipped 1 1/4c to $6.78 1/2.
Wheat (Source: CME)
U.S. wheat futures end mixed, ending the sharp rally of the past two days, as traders locked in profits in the face of increased export competition and the absence of external market support. Without a fresh spark to encourage additional buying, traders were content to take some profits off the table, said Shawn McCambridge, senior grains analyst with Jeffries Bache in Chicago. A recovery in the U.S. dollar served as another negative factor for prices. However, Minneapolis spring wheat and Kansas City hard red winter wheat ended higher, as supplies of high protein wheat are tighter than Chicago soft red winter wheat, analysts said. CBOT Sept wheat end down 1% at $7.07, KCBT September rose 0.4% to $7.65 1/4 and MGEX September climbed 1% to $8.29.
Rice (Source: CME)
US rice futures continued to surge, ending higher on a troubled US crop and strong world prices. A sharp reduction in planted acreage--along with hot, dry weather--is expected to limit this year's crop, analysts say. They add that world prices and uncertainty about Thailand's rice policies are supportive as well. And a commercial buyer notes technical buying has helped accelerate gains, and in the process creating a huge premium to cash prices. September CBOT rice ends up 1.9% to $17/hundredweight and is up almost $3 from a June 30 intraday low.
U.S. corn, wheat steady near 4-week top, soy flat
SINGAPORE, July 14 (Reuters) - Chicago corn and wheat were steady , after a strong rally in the last two sessions drove prices to a 4-week top, supported by bullish fundamentals and the possibility of more U.S. Federal Reserve stimulus.
"The focus is on debt problems in the U.S. and Europe and what is happening in the equity markets," said Ker Chung Yang, analyst at Phillip Futures in Singapore.
French analyst hikes EU wheat forecast after rain
PARIS, July 14 (Reuters) - French analyst Strategie Grains on Thursday raised sharply its outlook for soft wheat output in the European Union after rain last month revived crops parched by a spring drought in the west of the bloc.
The analyst increased its estimate of 2011 soft wheat production in the EU by 4.6 million tonnes to 130.2 million tonnes, now up 2 percent on last year's harvest.
Missouri River floodwaters taking more farmland
KANSAS CITY, Mo, July 13 (Reuters) - The swollen Missouri River was swamping more farmland in Missouri on Wednesday as federal officials began to prepare for a gradual reduction in water releases from a key dam starting later in July.
Residents from Montana through Missouri have built flood barriers and evacuated homes for more than a thousand miles over the last two months as melting snow and heavy rains overwhelmed six reservoirs on the Upper Missouri River.
Strategie Grains: EU 2011-12 Grain View +6.6 Mln Tons At 282.3 Mln Tons (Source: CME)
Influential analyst Strategie Grains raised its estimate for European grain production in 2011-12 by 6.6 million metric tons to 282.3 million tons as belated rains helped the region's parched crops. Much of the rise was down to "excellent conditions" for soft wheat crops, which the analyst forecast will reap 130.2 million tons this season, 4.6 million tons higher than previously thought and 2.9 million tons more than in 2010-11. Good rainfall particularly helped to fill out crops in the European Union's largest producers--France, Germany and the U.K.--which are now expected to harvest 3.3 million tons more than had been expected. "In these countries, harvest outcomes are now set to be much better than had seemed possible a month ago," said Strategie Grains. The estimates follow a raft of upgrades from analysts as the effects of severe drought earlier this year were eased by much-needed rainfall. The U.S. Department of Agriculture Tuesday pegged EU wheat output at 132.12 million tons.
Higher production is also expected to boost EU exports onto the world market by 3.2 million tons, leaving the supply and demand balance in the bloc "in balance" despite a sharp drawdown in stocks in 2010-11. Global soft wheat production is expected to hit 671 million tons, up by four million tons compared to Strategie Grain's previous prediction and up 20 million tons on last year due to better harvests in Russia and Ukraine. However, Strategie Grains said it expected the "overall world environment [to] remain fragile" in 2011-12, with the global ending stocks-to-use ratio estimated at 23.8%. "Even though EU prices may be subject to downward pressure from the Black Sea countries through the summer and even autumn, they retain an increase potential because US and world stocks are forecast so low," said the analyst. EU barley production is expected to total 52.9 million tons, 700,000 tons higher than predicted last month.
Forecast corn output was also revised 1.2 million tons higher to 60.2 million tons, compared with 55 million tons last year.
Australian Transgenic Wheat Trials Stopped By Greenpeace (Source: CME)
Two environmental activists from Greenpeace smashed experimental trials of genetically modified wheat being conducted by Australia's premier science agency, the Commonwealth Scientific and Industrial Research Organization, Greenpeace said. Two women using mechanical slashers destroyed the crops in a raid on the outskirts of Canberra, according to a statement from Greenpeace. "GM wheat has already been rejected in Canada, North America, Russia and the E.U.," Greenpeace food campaigner Laura Kelly said in a statement. "With Csiro being used as a front for foreign biotech companies, Australia's multibillion dollar wheat industry risks becoming a petri dish for these risky and secret experiments."
Indonesia wheat ample, India seen as last resort
JAKARTA, July 13 (Reuters) - Indonesia has ample wheat for the festive season and will seek Indian supply only as a last resort, the head of an industry group said on Wednesday, dampening hopes that the major Asian buyer would take up exports from India.
Indonesia's wheat grain inventory is estimated at 1.5 million tonnes, enough for three months of consumption that includes the high-demand period during the Ramadan fasting month in August and Eid al-Fitr festivities, said Ratna Sari Loppies, executive director of the Indonesian Wheat Flour Mills Association.
India misses the bus with wheat export decision
NEW DELHI/SINGAPORE, July 13 (Reuters) - India's plan to sell wheat after a four-year ban will find few takers as resumption of Russian exports is likely to flood the market with cheaper grain, already a nightmare for top suppliers the United States and Australia.
New Delhi's move will only add pressure to benchmark U.S. wheat futures , which have slid more than 14 percent since the start of June, dragged down by prospects of Black Sea supplies that are larger than expected.
Argentina Sunflower Seed Chamber Sees Area Up 10% On Year (Source: CME)
Argentina's sunflower seed area is expected to rise 10% on the year in the 2011-12 season as soaring prices spur farmers to increase planting, the president of the sunflower association Asagir, Ricardo Negri, said in an interview with Dow Jones Newswires. Argentina is the world's No.2 sunflower oil exporter, trailing only the Ukraine last year, according to the U.S. Department of Agriculture. Argentina accounts for almost a fifth of global export supply, Negri said. Argentina's fields are in good shape after recent steady showers, and sunflower planting is set to kick off in about a month. Farmers are optimistic with current sunflower oil export values of $2,400 a metric ton, up from $950 a ton a year ago, Negri said. Argentina planted 1.65 million hectares with sunflowers the previous season, he said.
Despite the positive signs from local farmers, the USDA is expecting Argentina's sunflower oil production from the 2011-12 season to total 1.26 million metric tons, unchanged from 2010-11. The USDA pegs Argentina's 2011-12 exports at 950,000 tons, also unchanged on the year. Sunflower seed growers are also enjoying a relatively open market, largely free from government intervention. The sunflower seed market has largely escaped the policies which farmers of other products complain distorts markets and sharply lowers their sales price. The left-leaning, populist government of president Cristina Kirchner tightly controls corn and wheat exports to keep a lid on domestic prices, only clearing shipments once local supply has been set aside. Farm exports are also taxed heavily both to raise revenue and keep down grocery bills. Soybeans carry a 35% duty and sunflower seed oil exports a 30% tax.
The fact that just a quarter of sunflower seed oil production is enough to meet local demand has helped the commodity avoid coming under government scrutiny, Negri said. The industry has also developed its own system to keep down local sunflower oil prices and avoid government attention. Producers sell discounted sunflower oil to the domestic market, with those selling locally compensated by part of the fat profits enjoyed by exporters. While Argentina's farmers are flourishing amid a global commodities price boom despite the government's policies, they worry about being vulnerable if the bubble bursts. "If prices fall, many farmers in marginal areas will stop growing crops with export taxes at such high levels," Negri said.
Soybeans Extend Longest Rally Since August as Hot Spell May Hurt U.S. Crop (Source: Bloomberg)
Soybeans rose, extending the longest rally since August, on speculation that unusually hot weather during the next month will curb crop yields in the U.S., the world’s biggest grower and exporter. Temperatures will be as much as 12 degrees Fahrenheit above normal for five days starting July 16 in the Midwest, the main growing region, before cooler weather and rain return, the National Weather Service said. July may rank as the sixth warmest since 1960, T-Storm Weather LLC said in a report. Soybean prices are up 7 percent this month.
Sugar Falls Most in Eight Weeks on Brazil Crop Outlook; Coffee, Cocoa Drop (Source: Bloomberg)
Sugar fell the most in eight weeks on signs that production in Brazil, the world’s biggest grower, will be higher than some analysts expected. Coffee and cocoa retreated. The sugar industry group Unica cut its output forecast for the Center South, Brazil’s largest producing region, by 2.2 million metric tons to 32.4 million. Analysts expected at least a 3 million-ton reduction due, said Jack Scoville, a vice president for Price Futures Group Inc. Before today, prices rose 24 percent in the past month on supply concerns.
Sugar extends retreat from contract highs, cocoa up
LONDON, July 14 (Reuters) - Raw sugar futures on ICE eased in early trade as the market retreated further from the prior session's contract highs while cocoa edged up aided partly by supportive second quarter European grind data.
ICE raw sugar futures were lower with the market finally suffering a modest setback following a prolonged advance which culminated with contract highs being established on Wednesday.
Nicaragua coffee exports drop 47 pct in June
MANAGUA, July 13 (Reuters) - Coffee exports from Nicaragua fell 47 percent in June, bringing accumulated shipments for the harvest season down by more than 4 percent compared to last year, the national export board said on Wednesday.
The coffee harvesting season in the region begins in October and comes to a close in September, with the bulk of picking mostly over in the summer months.
Brazil sugar cane crop to post 1st drop in a decade
SAO PAULO, July 13 (Reuters) - Sugar cane output in Brazil, the world's top producer and exporter, will post its first annual decline in a decade as industry group Unica on Wednesday slashed its forecast for the center-south crop in 2011/12 by 6.2 percent.
Analysts had revised down their production forecasts due to lower yields from aging plants and weather problems. Still, the new forecast, for 533.5 million tonnes, was at the lower end of market expectations.
Brazil CS cane crush down 18 pct from yr ago
BRASILIA, July 13 (Reuters) - Crushing of Brazil's 2011/12 cane crop reached 176.9 million tonnes by July 1, down 18 percent from 215.7 million tonnes by this time a year ago, cane industry association Unica said on Wednesday.
Cumulative sugar production this season until July 1 reached 9.34 million tonnes, 19 percent less than the 11.5 million tonnes produced by the same time last year.
Nestle gives farmers disease-resistant cocoa trees
BONOUA, Ivory Coast, July 13 (Reuters) - Nestle on Wednesday ramped up its distribution of disease-resistant cocoa trees to farmers in Ivory Coast, part of a plan to boost productivity per hectare and improve the notoriously poor quality of the top grower's cocoa beans.
The world's biggest food maker, which has distributed some 140,000 saplings since 2009, said it will hand out 600,000 saplings by the end of the month and a further one million next year in a bid to raise productivity on farms.
European Q2 cocoa grindings seen slightly up on year
LONDON, July 13 (Reuters) - Second quarter European cocoa grindings are expected to be slightly up on the same period last year, as the temporary closure of capacity in top producer Ivory Coast continued to boost grindings in other regions in April and May, dealers said.
First quarter European grindings rose by 3.5 percent on the year earlier, partly boosted by the lack of activity in Ivory Coast.
Philippines may export 200,000T sugar on top of US quota
MANILA, July 13 (Reuters) - The Philippines says it can export up to 200,000 tonnes of raw sugar this year on top of its U.S. quota commitments, but it may not have a lasting impact on global prices as the shipments will only partly offset expected crop losses in Brazil.
The Southeast Asian country would start selling raw sugar this month to Japan and Indonesia, with committed shipments of 35,892 tonnes, Rosemarie Gumera, manager at the policy and planning unit of the state agency Sugar Regulatory Administration (SRA), told Reuters.
Oil Drops After Bernanke Says Fed Isn’t Planning More Stimulus (Source: Bloomberg)
Oil in New York fell, reaching a record discount to Brent crude, after Federal Reserve Chairman Ben S. Bernanke said the Fed isn’t planning more bond-buying to stimulate economic growth. Futures dropped 2.4 percent after Bernanke told Congress that the central bank would be cautious about initiating a third round of quantitative easing because of higher inflation this year. Oil climbed as much as 0.8 percent earlier when the Labor Department said applications for unemployment benefits decreased 22,000 to 405,000 last week.
Rio Q2 iron ore output rises, coal still recovering
SYDNEY/LONDON, July 14 (Reuters) - Global miner Rio Tinto is on track to hit its 2011 iron ore production target after posting on Thursday a 12 percent rise in second-quarter output on the year, but its Australian coal operations were still recovering from floods.
Flooding and cyclone damage to mining operations contributed to the biggest slump in 20 years in Australia's GDP in the first quarter. The economy relies on coal as its single largest export earner and has been bracing for a fall of 5 percent in shipments.
China sets second batch rare earth export quotas at 15,738 tonnes
SHANGHAI, July 14 (Reuters) - China's Ministry of Commerce said on Thursday it was issuing a second batch of rare earth export quotas for this year, with the second batch totalling 15,738 tonnes.
China produces 97 percent of the world's supply of rare earths, a group of 17 minerals used in electronics and defence and renewable energy industries.
China Almost Doubles Rare-Earth Export Quota (Source: Bloomberg)
China, the world’s biggest supplier of rare earths, almost doubled its export quota for the second half of 2011, a change the European Union said actually adds restrictions to overseas shipments. Less than two weeks after the World Trade Organization said Chinese limits on raw-material exports break global trade rules, the country yesterday raised the quota for 26 companies to 15,738 metric tons. That compares with 7,976 tons a year earlier and brings the limit to 30,184 tons for 2011, little changed from 30,258 tons in 2010, government figures show.
China's H2 aluminium output to rise 8 pct on H1 -industry
HONG KONG, July 14 (Reuters) - China's production of primary aluminium is likely to rise at least 8 percent in the second half of the year from the first, thanks to new capacity and steady prices that prompt smelters to use idle capacity, industry sources said on Thursday.
Industry sources said second-half output would not be hurt by Beijing's tighter curbs on new projects because the government was targeting projects planned but not completed.
Indonesia's Timah sees lower exports, higher revenue-paper
JAKARTA, July 14 (Reuters) - Indonesia's Timah , the world's largest integrated tin miner, expects a slight decline in sales this year, but revenue could rise on higher tin prices, Bisnis Indonesia reported on Thursday.
Production and sales of refined tin were forecast to reach 40,000 tonnes in 2011, down slightly from 40,413 tonnes in 2010 due to tough competition from illegal miners in the main producing island of Bangka and Belitung, Chief Executive Wachid Usman was quoted as saying on Wednesday.
METALS-Copper up on growth prospects, risk aversion caps gain
LONDON, July 14 (Reuters) - Copper was steady on Thursday on the London Metal Exchange, underpinned by prospects of improving global economic growth in the second half while supply remains constrained, but a flight from risk in wider markets curtailed gains.
Three-month copper on the LME was untraded in official rings, but quoted at $9,670/9,680 a tonne, up from a close of $9,650 a tonne on Wednesday.
PRECIOUS-Gold hits record after Moody's warning, easing hints
LONDON July 14 (Reuters) - Gold prices hit record highs for a second day on Thursday after hints of further policy easing from the Federal Reserve and a Moody's warning the United States may lose its top-notch credit rating hurt the dollar and sparked buying of safe-haven assets.
The precious metal was also strengthened by concerns over euro zone debt levels, which have intensified over delays to policymakers' plans to discuss the crisis and after Greece's credit rating was downgraded by Fitch late on Wednesday.
Gold Rises to Record on ‘Witch’s Brew’ of U.S., Europe Debt, Currency Woes (Source: Bloomberg)
Gold futures rose to a record for the second straight day on speculation that debt woes in the U.S. and Europe will escalate, boosting the appeal of the precious metal as a haven. Silver climbed to a nine-week high. Moody’s Investors Service said the U.S. may lose the Aaa credit rating held since 1917. Fitch Ratings said that a default in Greece is a “real possibility.” The dollar headed for the third consecutive drop against a basket of currencies.
Gold May Extend Gains on Fed Stimulus Signal, Debt Concern, Survey Shows (Source: Bloomberg)
Gold may extend gains from a record as concern about more U.S. economic stimulus and debt woes in the country and Europe boost demand for a protection of wealth, a survey found. Twenty-four of 27 traders, investors and analysts surveyed by Bloomberg, or 89 percent, said bullion will rise next week. One predicted lower prices and two were neutral. Gold for August delivery was up 2.9 percent for this week at $1,586 an ounce by 11:08 a.m. yesterday on the Comex in New York after earlier in the day touching a record $1,594.90.
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