Tropical Storm Nate Forms off Mexico; Three Storms Now Churn in Atlantic (Source: Bloomberg)
Tropical Storm Nate, the second storm to develop today and the third system in the Atlantic basin, was “almost stationary” in Mexico’s Bay of Campeche, according to the National Hurricane Center. Nate, with winds of 45 miles (72 kilometers) per hour about 140 miles west of Campeche, Mexico, isn’t expected to move much tonight or tomorrow, according to an advisory issued by the hurricane center before 8 p.m. East Coast time. Nate, which joined Hurricane Katia and Tropical Storm Maria earlier today, is forecast to turn north tomorrow and may strengthen into a Category 1 hurricane with winds of 75 mph. Computer models suggest Nate will either go ashore in Mexico south of the oil- and gas-producing region or near Brownsville, Texas, said Travis Hartman, a meteorologist at commercial forecaster MDA EarthSat Weather in Gaithersburg, Maryland.
Corn (Source: CME)
US corn futures finish lower as traders take profits ahead of a highly anticipated crop report Monday. Market participants wanted to take money off the table due to great uncertainty about the size and quality of the upcoming corn harvest, analysts say. The crop suffered an unknown amount of damage from hot, dry weather this summer and flooding in the spring. "People just may be sort of standing on the sidelines waiting for next Monday," says Dale Durchholz of AgriVisor. CBOT December corn slides 7 3/4c to $7.48 a bushel.
Wheat (Source: CME)
US wheat futures close down as traders worry about lackluster export demand. Egypt, typically the world's largest wheat importer, bought 300,000 tons of Russian and Kazakh wheat. There were no bids made for US wheat, which has been losing ground to lower-priced Black Sea product. US exporters "are kind of throwing up the white flag a little bit, at least in the short term, on these types of tenders," says Shawn McCambridge of Jefferies Bache. CBOT December wheat drops 8 1/2c to $7.51 1/2 a bushel, KCBT December loses 6 1/2c to $8.59 and MGEX December drops 5 1/4c to $9.26 1/2.
Rice (Source: CME)
US rice futures finish higher, avoiding losses seen in other grain markets, as rice continues to get support from concerns about tightening global supplies. The USDA fueled worries of a poor US harvest by lowering its good-excellent rating for the crop by one percentage point to 64%. A year ago, the crop was rated at 68% good-excellent. The government will update its output estimate Monday. CBOT November rice jumped 17 1/2c to $18.15/hundredweight.
Corn, soy rise as US crops deteriorate; wheat firm
SINGAPORE, Sept 7 (Reuters) - Chicago corn and soybean futures rose, supported by deteriorating condition of the U.S. crops which is threatening to further tighten global supplies.
"I think the crop progress report is supporting prices as it has shown that the condition of U.S. crops is worsening," said Ker Chung Yang, an analyst at Phillip Futures in Singapore.
Forecasters split on U.S. corn crop shrinkage
CHICAGO, Sept 6 (Reuters) - There is no dispute that the size of this year's U.S. corn crop is shrinking due to bad weather. Even so, the two main private forecasters have vastly divergent estimates of how much production will fall -- to the tune of 675 million bushels.
The high-low difference almost equals the U.S. government's estimate of total ending stocks next summer of 714 million bushels. The sharp divide in forecasts comes just days before the Department of Agriculture updates its forecast on Monday Sept. 12.
EU on course for good maize crop after rain
HAMBURG, Sept 6 (Reuters) - The European Union is set for an excellent maize (corn) crop this summer which could help protect the bloc from possible tight global supplies, traders and analysts said on Tuesday.
Rain which caused misery for some European wheat farmers gave maize an extra growth push, traders said.
Informa cuts 2011 US corn yield to 151.0 bu/acre
CHICAGO, Sept 6 (Reuters) - Analytical firm Informa Economics on Tuesday cut its estimate for 2011 U.S. corn yield to 151.0 bushels per acre and cut production to 12.711 billion from 13.353 billion.
Informa also cut its forecast soy yield to 41.5 bushels per acre from the previous 42.5 and soy production to 3.061 billion from the previous 3.139 billion, trade sources said.
Allendale cuts US corn crop outlook to 12.466 bln
CHICAGO, Sept 6 (Reuters) - Illinois-based research and advisory firm Allendale Inc has forecast 2011 U.S. corn production at 12.466 billion bushels and the yield per acre at 147.7 bushels per acre, according to an Allendale survey of farmers.
Allendale also pegged this year's U.S. soybean production at 3.007 billion bushels and soybean yield at 40.7 bushels per acre.
Rains in US to provide minor benefit to mature crops
CHICAGO, Sept 6 (Reuters) - Rain in the U.S. over the weekend and more showers forecast for the central and eastern Midwest this week will not buoy corn or soybean production, an agriculture meteorologist said Tuesday.
Corn and soybean crops are in their late filling stage of development and rainfall now will provide only minor benefit to each crop.
Cropcast Projects US Corn Output Will Drop 4.3% From 2010 (Source: CME)
Cropcast Ag Services, a well-known agricultural weather firm, projected U.S. farmers will harvest 4.3% less corn than last year due to poor weather. The Maryland-based firm, a division of EarthSat Weather Services, pegged the corn harvest at 11.913 billion bushels, down from 12.447 billion last year. It estimated the average yield at 145.2 bushels an acre, down from 152.8 bushels an acre last year. The forecasts are well below the U.S. Department of Agriculture's latest projections for this year's crop and estimates from other private forecasters. The government, in a monthly report Aug. 11, pegged the crop at 12.914 billion bushels, with an average yield of 153 bushels an acre. By comparison, brokerage firm Allendale on Tuesday pegged the corn harvest at 12.466 billion bushels, with an average yield of 147.7 bushels an acre. INTL FCStone last week projected farmers will harvest 12.35 billion bushels of corn, with an average yield of 146.3 bushels an acre.
Cropcast cut its output forecast because it expects many acres planted with corn will not be harvested due to flooding around the Mississippi and Missouri rivers and a severe drought in Texas, said Don Keeney, senior agricultural meteorologist for Cropcast. The firm projected farmers will harvest 82.06 million acres of corn, while the USDA last estimated 84.4 million acres will be harvested. The firm did a satellite analysis earlier this year and "took a lot of acreage out of a lot of states due to flooding," Keeney said. The number of bushels produced per acre was hurt by hot, dry weather this summer. "Our acreage is lower than most," Keeney said. Cropcast pegged the U.S. soybean harvest at 2.924 billion bushels, with an average yield of 40.3 bushels an acre. That is down from last year's harvest of 3.329 billion bushels, with an average yield of 43.5 bushels an acre. The USDA last month pegged this year's soybean harvest at 3.056 billion bushels, with an average yield of 41.4 bushels an acre.
The USDA is slated to update its harvest estimates Monday.
Saudi Arabia Seeks Cooperation With Ukraine On Grain Needs - Fin Min (Source: CME)
Saudi Arabia, the Middle East's biggest economy, is seeking closer cooperation with Ukraine as part of plans to diversify its grain imports and reduce its dependence on barley, the country's finance minister said. "We discussed during a recent trip to Ukraine cooperation with Ukraine, not only on barley but also grains in general," Ibrahim Al Assaf said on the sidelines of a meeting of Arab finance ministers in Abu Dhabi, the United Arab Emirates' capital. The desert kingdom, which falls into the category of 'hyper-arid' countries and has neither major rivers nor lakes, is currently looking at alternatives to barley to reduce its dependence on the grain, Al Assaf said. Ukraine is a major grain exporter. "We are looking at the alternatives to only barley, such as composite feed and other grains," he added.
Saudi Arabia is the world's largest importer of barley, with "over 50% of the world trade in barley. Taking the average of last year, we imported between 7 million to 7.5 million tons of barley for feed for the animals," Al Assaf said. Persian Gulf countries already import the bulk of their food. The region previously suffered when international food prices spiked to record levels in 2008, forcing up their import bills. They have since sought to lease and buy farmland in developing nations in efforts to improve security of food supplies.
One-Third Of Crops In Western Canada Harvested - Wheat Board (Source: CME)
Favorable weather conditions allowed producers in western Canada to advance harvest operations, with an estimated 33% of the various grains and oilseeds now combined, according to the Canadian Wheat Board in its weekly bulletin. At the same time a year ago, only 18% of the various crops had been harvested. Normally, 31% of the harvest is usually completed by this time of year, the CWB said. Good harvest progress occurred across most of the Canadian prairies, despite a mid-week storm system that brought 10 to 55 millimeters of rain to many regions. In southern Alberta and pockets of western Saskatchewan, minimal rainfall meant the harvest could continue to build speed, the CWB said.
Meanwhile, above-normal temperatures on the eastern Canadian prairies kept harvesting on track. Harvest operations in Manitoba were about 47% complete, compared to 40% on average. Alberta was 29% harvested, compared to 27% normally. In Saskatchewan, the harvest is about 32% complete, compared to 26% normally.
Ukraine Grain Export Continuing Despite Export Tax (Source: CME)
Ukraine will continue exporting grain as planned, despite the government deciding to keep the current grain export tax in place until the end of this year, Deputy Economic Development Minister Vadim Kopylov said. Kopylov, quoted by the ministry's press service, admitted that in August there was actually a decrease in grain exports, based on rumors of the government lifting the export tax, thus persuading exporters to hold back their grain. Kopylov added that when it became clear that the grain export tax would not be abolished, exports intensified, with 600,000 metric tons of grain submitted to the customs for export on Aug. 31 alone, while total grain exports in August were one million tons. Kopylov also said the fact that Russia was selling its grain at cheaper prices would not negatively affect Ukraine's exports.
"The world market is big enough to consume both Russian and Ukrainian grain," he said. "There was a drop in prices in July, but in August prices leveled out. Ukraine will export all the grain it plans, about 24 million tons in the current marketing year [and even though] our grain is more expensive than Russian grain people are still buying it."
Soybeans, Corn Decline on Weakening Overseas Demand for U.S. Supplies (Source: Bloomberg)
Soybeans declined for a second straight session on slowing Chinese demand for supplies from the U.S., the world’s biggest shipper. Corn fell on signs of weakening exports. Soybean importers, including China, took advantage of record inventories in Argentina and Brazil, the biggest growers after the U.S., Oil World, a Hamburg-based researcher, said yesterday in a report. The climbing stockpiles have spurred lower prices for supplies from South America at a time when adverse weather has threatened U.S. crops. “We have seen a dearth of new buying from China,” Anne Frick, the senior oilseed analyst for Jefferies Bache LLC in New York, said today in a telephone interview. “South America has plenty of beans to sell to overseas customers.”
Commodities Record Biggest Gain in Four Weeks on Stimulus Outlook in U.S. (Source: Bloomberg)
Commodities posted the biggest gain in almost four weeks, led by industrial metals and energy, on speculation that more economic stimulus in the U.S. and low interest rates will bolster demand for raw materials. The Standard & Poor’s GSCI Index of 24 raw materials rose 2.1 percent to close at 671.99 at 3:46 p.m. New York time, the biggest gain since Aug. 11. Nickel jumped 5.3 percent, the most since May 2010, and crude oil gained as much as 5.2 percent. The commodity gauge fell in the previous three sessions on concern that Europe’s debt crisis will hinder the global economy. “Although growth prospects remain bleak, the market is looking past current weakness in anticipation of further stimulus out of the U.S. and anticipation that the Chinese may resume their pro-growth policies,” Scott Gardner, the chief investment officer at Verdmont Capital SA in Panama, said in an e-mail. He helps manage $450 million in client assets.
ICE coffee, sugar rise as commodities rebound
LONDON, Sept 7 (Reuters) - ICE arabica coffee and raw sugar futures rose in early trade as both markets clawed back some of the prior session's steep losses, mirroring a similar rebound in other financial markets.
ICE arabica coffee futures rose as investors regained some of their appetite for risk after Tuesday's sell-off.
Ghana says to give away cocoa seedlings to farmers
ACCRA, Sept 6 (Reuters) - Ghana, the world's second-largest cocoa grower after Ivory Coast, will supply 20 million free cocoa seedlings per year to farmers to boost production, Finance Minister Kwabena Duffuor said on Tuesday.
"We believe we should be able to provide free seedlings to all farmers and others intending to go into cocoa farming henceforth," Duffuor said at a meeting with farmers.
Ukraine starts 2011 sugar processing
KIEV, Sept 6 (Reuters) - Ukraine, which plans to raise white sugar production by 40 percent in 2011, has started sugar beet processing, major agriculture producer Astarta said on Tuesday.
"Globyno and Yaresky sugar plants in Poltava region and Zhdanivsky plant in Vinnytsa region started a sugar production campaign," Astarta said in a statement.
Key India state's 2011/12 sugar output seen at 10 mln T-min
NEW DELHI, Sept 6 (Reuters) - Sugar output from the western Maharashtra state, India's top producer of the sweetener, is likely to be a record 10 million tonnes in 2011/12 on higher acreage and sufficient rainfall, the state's farm minister said on Tuesday.
India, the world's top sugar consumer and second-biggest producer, is expected to produce 26 million tonnes of sugar in the season from October 2011, up 7.4 percent year-on-year, according to Indian Sugar Mills Association, a producers' body.
Thai 2011/12 white sugar exports seen at 3.3 mln T-Louis Dreyfus
NEW DELHI, Sept 6 (Reuters) - Thailand's white sugar exports are seen at 3.3 million tonnes in 2011/12, commodities firm Louis Dreyfus said on Tuesday, against 2.2 million tonnes a year ago.
"Thailand is expected to export 3.3 million tonnes of white sugar in 2011/12 against 2.2 million tonnes a year ago," Patrick Dean, global white sugar manager of Louis Dreyfus Commodities, told reporters in New Delhi.
Cotton Rises to Two-Month High on U.S. Crop Damage; Orange Juice Advances (Source: Bloomberg)
Cotton rose to the highest price in almost two months as Tropical Storm Lee may have damaged crops in the U.S. South and a report showed global imports will rebound. Orange juice also climbed. Tropical Storm Lee brought heavy rains to Louisiana and much of the Gulf Coast, and rain was expected to continue through the middle of the week across states including Georgia and North Carolina, according to the National Weather Service. Global cotton imports will rebound to 8.1 million metric tons in the year that started Aug. 1 as China rebuilds government reserves, the International Cotton Advisory Committee said. “The initial push was from the news on China, but there’s also a perfect storm brewing here with technical charts and crop damage,” Louis Barbera, a broker at VIP Commodities in New York, said in a telephone interview. “The fact of the matter is that we’re going to have a small crop.”
Growth of China steam coal use to ease
BEIJING, Sept 7 (Reuters) - China's steam coal demand growth will gradually ease over 2011-2015, as economic growth moderates and as Beijing restructures its economy, an official with China Electricity Council said on Wednesday.
Xie Jucheng, head of the fuel branch of the council, told the IHS-McCloskey Coal Conference in Beijing that increased investment in renewable power, the construction of ultra-high voltage power transmission lines as well as higher rail capacity, would also smooth out seasonal coal shortages by about 2013.
Colombia exports rise 55 pct in July - govt
BOGOTA, Sept 6 (Reuters) - Colombia's exports rose 55 percent in July versus the same month a year earlier, pushed up by the sale of oil and crude products, the government's statistics agency said on Tuesday.
One of several emerging-market countries helped by a boom in commodity prices, Colombia's total exports in the month were worth $4.89 billion, according to the DANE statistics agency.
Pacific Coal output seen up 50 pct in 2011 vs yr ago
BOGOTA, Sept 6 (Reuters) - Pacific Coal Resources Ltd expects thermal coal output from two open-pit mines to rise about 50 percent this year to 1.75 million to 1.8 million tonnes and in 2012 to 2.2 million to 2.3 million tonnes, its chief executive officer said on Tuesday.
Colombia, one of the world's top coal exporters, is looking to double production of the material in coming years from current levels to around 80 million tonnes per year as it aims to take advantage of growing demand in many emerging markets.
China's 2011 coal imports seen off 2010 record
BEIJING, Sept 6 (Reuters) - China's coal imports this year are expected to pull back from the record level in 2010 despite strong domestic demand, as growth in local production and transportation capacity help meet overall demand, an industry official said on Tuesday.
Dong Yueying, secretary-general of China Coal Transport and Distribution Association (CCTD), told a coal conference in Beijing that he expected about 150 million tonnes of coal will be imported this year.
Euro Coal-Steady, few trades seen
LONDON, Sept 6 (Reuters) - European prompt physical coal fell by around 50 cents a tonne on Tuesday for the second day running but such a small movement in prices was negligible, traders and European utilities said.
Overall, coal remained in slight oversupply in Europe where the majority of utilities have ample supplies booked for the rest of the year and several continued to be active sellers of prompt cargoes.
Crude Gains a Second Day on U.S. Stockpile Decline as Storms Threaten Gulf (Source: Bloomberg)
Oil climbed for a second day in New York on speculation a storm building in the Gulf of Mexico poses a threat to supply in the U.S., amid shrinking crude stockpiles in the world’s biggest consumer. Futures advanced from the highest settlement in five weeks after the industry-funded American Petroleum Institute said inventories fell 2.97 million barrels last week. An Energy Department report today may show supplies slid 2 million barrels as Tropical Storm Lee shut output, a Bloomberg News survey of analysts show. Another cyclone, Nate, formed off Mexico, becoming the third now churning in the Atlantic basin. “Output outages in the Gulf of Mexico and a low pressure system over Mexico’s Bay of Campeche were the key drivers,” John Peters, a senior economist at Commonwealth Bank of Australia, said in a note today.
POLL-China refineries to raise Sept runs to highest in 2011
BEIJING, Sept 7 (Reuters) - Leading Chinese refineries will raise their crude oil throughput in September to the highest level this year, after PetroChina restarted a major crude unit in its largest Dalian refinery, a Reuters poll showed.
The 12 plants, which account for nearly a third of China's capacity and mostly lie in coastal regions, plan to process 2.94 million barrels per day (bpd) of crude oil this month, up 5.8 percent from August.
Oil producers target Asia as outlook in West bleak
SINGAPORE, Sept 7 (Reuters) - Oil producers from Brazil to Azerbaijan are targeting Asia to expand sales as growth falters in the U.S. and Europe, highlighting confidence that the world's fastest-growing energy market will offset any demand slump in industrialised nations.
At Singapore's annual Asia-Pacific Petroleum Conference (APPEC) this week, company executives are still upbeat about booming energy consumption in the region, despite the uncertainty surrounding the pace of global economic growth.
Iran imports 4-5 cargoes of gasoline per month-sources
SINGAPORE, Sept 7 (Reuters) - Iran has been importing four to five cargoes of gasoline per month, with most of it supplied by China as the Islamic Republic finds ways to get around the U.S.-led sanctions, three industry sources familiar with the matter said.
"For sure Iranians are importing gasoline from Asia, China namely," one source said. "Suppliers sell to traders on a free-on-board (FOB) basis and they know that the cargo will end up in Iran," he added.
Oil up at $113, on lower stocks, weak dollar
LONDON, Sept 7 (Reuters) - Oil was up at just over $113 a barrel on Wednesday, underpinned by expectations of lower U.S. crude stocks after a storm disrupted production in the Gulf of Mexico, and optimism about a new support package for the U.S. economy.
"Oil does seem to have an ability to stay up despite appalling economic data, due to Middle East unrest, hurricanes and dollar weakness," said Christopher Bellew, a trader at Jefferies Bache.
China nickel ore imports to slow in H2 vs H1 - Jinchuan exec
SHANGHAI, Sept 7 (Reuters) - China's nickel ore imports are expected to slow in the second half compared with the first, an executive at the country's top nickel producer Jinchuan Group told Reuters on Wednesday.
Wu Jun, Vice President of Jinchuan Group Ltd, did not elaborate. Wu also said the company expects to achieve its 2011 nickel output target of 130,000 tonnes this year.
China's H2 steel output growth set to slow- CISA
SHANGHAI, Sept 7 (Reuters) - China's steel output growth is likely to decelerate in the second half in line with slowing economic growth, a senior industry official said on Wednesday, but annual production could still hit a record.
Steel output would be above 700 million tonnes should the sector continue to grow at the blistering clip it recorded in the first half of the year, Wang Xiaoqi, vice chairman of the China Iron & Steel Association (CISA), told an industry conference.
Iron Ore-Spot prices steady; mills optimistic - analyst
SHANGHAI, Sept 7 (Reuters) - Spot iron ore prices for 63.5/63-percent grade in China were steady at $190 per tonne on Wednesday, as some steel mills suspended purchases of raw material until they see a decisive lift in steel prices first, traders said.
"A few mills have started buying iron ore for the winter season, while most are still on the sidelines, waiting for a bigger profit margin from steel prices," said a Shanghai-based trader.
China's 2011 steel output seen at 706 mln T - CISA
SHANGHAI, Sept 7 (Reuters) - Steel output in the world's top steel producer China is likely to hit a fresh record in excess of 700 million tonnes this year based on first-half production, a senior official with the China Iron & Steel Association (CISA) said on Wednesday.
"Based on steel production in the first half, China's steel output may reach 706 million tonnes and likely 710 million tonnes this year, but steel output growth is set to slow," Wang Xiaoqi, vice chairman of the China Iron & Steel Association, told an industry conference in Shanghai.
Brazil to double mine royalties in legal overhaul
BRASILIA, Sept 6 (Reuters) - Brazil's overhaul of its mining code will likely double average royalty rates for minerals, Mines and Energy Minister Edison Lobao said on Tuesday.
Previously Lobao had said the government was considering a proposal to increase royalties to an average of 4 percent from 2 percent, but that the issue was still being studied.
Gold Rebounds After Declining for Two-Days on Outlook For U.S. Stimulus (Source: Bloomberg)
Gold for immediate delivery rose as much as 0.4 percent to $1,824.95 an ounce, and traded at $1,823.65 at 8:23 a.m. Singapore time. December-delivery futures in New York gained as much as 0.6 percent to $1,827.60 an ounce.
China looks to save struggling shipping sector at any cost
SINGAPORE, Sept 6 (Reuters) - China's campaign to protect its maritime industry during a severe downturn will become more costly for foreign companies as Beijing grabs a bigger slice of the profits for shipping iron ore, coal and grains to the world's second largest economy.
China's shipping sector -- led by state-owned COSCO Group -- has become one of the world's most influential with its fleet more than doubling over the last decade, matching the country's appetite for commodities and raw materials.
Baltic index rises, rally seen losing steam
LONDON, Sept 6 (Reuters) - The Baltic Exchange's main sea freight index or BDI, which tracks rates to ship dry commodities, rose to its highest in nearly nine months on Tuesday although there were doubts if a recent rally was likely to be sustainable.
Brokers said a growing ship glut was set to cap dry bulk freight rate gains in the coming months.
Vale in talks to sell mega iron ore vessels
LONDON, Sept 5 (Reuters) - Brazilian mining giant Vale is in talks with Chinese and other ship owners to sell or lease its planned fleet of giant bulk carriers, a Vale official told Reuters on Monday.
The move comes less than three months after Vale's first iron ore carrier, at 362 metres long the world's largest dry-bulk vessel, failed to gain access to Chinese ports and was forced to divert to Italy on its maiden voyage.
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