Soybeans (CME)
US soybean futures end flat, backpedaling from early session highs, as traders took profits on recent gains. Soybean futures found it tough to sustain price strength in the face of an advancing harvest, with traders also factoring in the potential for higher production estimates from government forecasters next week, analysts say. Industry analysts say soybeans remain vulnerable to the general sentiment in global financial markets, and need some conviction of stability in world markets before traders take on added risk. CBOT Nov soy end unchanged at $11.63 3/4/bushel, well off the session high of $11.82 3/4.
Soybean Meal/Oil (CME)
Soy-product futures stumble, retreating on late-day profit-taking. The inability of soybeans to sustain early advances quickly filtered into soymeal and soyoil, with traders taking a cautious approach ahead of next week's USDA reports and with global economic uncertainty still lingering. CBOT December soymeal end down $1.10 at $304.10/short ton as December soyoil dropped 0.06c to 49.14c/pound.
Malaysia Sets Sights On Nationwide Biodiesel Sales -Minister (CME)
Top palm oil producer Malaysia plans to sell palm-based biodiesel throughout the country by early 2013, Commodities Minister Bernard Dompok said. Malaysia continues to roll out its biodiesel B5 mandate, which was launched in the federal administrative capital of Putrajaya on June 1, after a five-year delay. B5 is a blend of 95% regular petroleum-based diesel and 5% palm oil-based biodiesel. The B5 mandate could use up around 500,000 tons of palm-based biodiesel annually and potentially prevent a large stock build-up, supporting palm oil prices, Dompok said. Malaysia produces around 17 million tons of palm oil a year and most of it is sold as edible oil, Dompok said. Malaysia has been struggling to implement a mandate to promote the palm-based biodiesel industry that was first introduced in 2007 as the blended fuel required subsidies to match diesel prices at the pumps, at a time when the country seeks to cut back on subsidies to reduce its huge fiscal deficit, he said.
Brazil 2011-12 Soy Crop Seen Down As Productivity Falls -Conab (CME)
Brazil's soy production is expected to decline in 2011-12, as the excellent weather that contributed to the previous year's bumper crop won't likely repeat itself, while good prices attract farmers into cotton and corn. Government crop-supply agency Conab said it estimates Brazil's 2011-12 soy production at between 72.19 million and 73.3 million metric tons, down from last year's output of 75.32 million tons. The expected drop in soy output reflects lower productivity, as planted area is set to increase 2% to 3.5% from the 24.18 million hectares sown in 2010-11. Conab said some farmers will want to plant corn rather than soy due to demand for feed from the local poultry and pork industries, as well as crop-rotation needs. "We must recall that in the last harvest, the weather conditions were extremely favorable [to soy], resulting in record productivities," Conab said. Brazil is the world's No. 2 exporter of soy, after the U.S.
Corn production, which occurs in two stages--a summer crop and a winter crop--is expected to reach between 57.33 million tons and 58.99 million tons during 2011-12, compared with the previous year's crop of 57.51 million tons. "The outlook for the first corn crop is good," Conab said, noting that planting of summer corn has already begun in some regions. "Good prices in the market should stimulate the planted area to increase." Planting of the grain is seen expanding between 2.5% and 4.6% from the past year's 13.84 million hectares. Cotton, of which Brazil is a growing supplier to world markets, could also increase its share of the grains-farming pie. Conab expects Brazil to produce between 1.93 million and 2.11 million tons of cotton fiber, compared with last year's crop of 1.96 million tons.
Conab noted that below-normal sea-surface temperatures in the equatorial Pacific Ocean indicate a possible return of the La Nina phenomenon, which tends to cause dry weather in Brazil's main agricultural regions. But the Southern Hemisphere spring in coming months should continue to see normal or slightly above-normal rainfall in most of the country, with drier conditions not expected until November and December, Conab said.
Palm oil at new one-year low as short sellers tap economic fears
KUALA LUMPUR, Oct 6 (Reuters) - Short-sellers again drove Malaysian palm oil to its lowest level in a year while other agricultural commodities have fallen slightly or clawed back some losses this week as fears about a global recession ease slightly.
"Losing 150 ringgit over a week is really not such a special thing with the financial turmoil going around. Now everyone is trying to see how far they can push palm oil down," said a trader with a foreign commodities brokerage.
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