20111201 1028 Global Commodities Related News.

Commodities Rise to Two-Week High as Fed, Central Banks Boost Liquidity (Source: Bloomberg)
Commodities rose to the highest in almost two weeks after the Federal Reserve cut the cost of emergency funding for banks in Europe as part of a global effort to stem the region’s sovereign-debt crisis. The Standard & Poor’s GSCI index of 24 raw materials rose 0.7 percent to settle at 658.02 at 4:04 p.m. New York time. Earlier, the measure reached 664.56, the highest since Nov. 17. Industrial and precious metals led the rally. In the two weeks ended Nov. 25, the GSCI gauge dropped 4.5 percent as borrowing costs surged in Europe, imperiling the euro and banks. The Fed’s move was coordinated with the European Central Bank and central banks in Canada, England, Japan and Switzerland. Separately, China cut the amount of cash that banks must set aside as reserves for the first time since 2008. Global stocks rallied.

China Food Prices Rose Last Week; Vegetables Lead - Ministry (Source: CME)
Food prices in China mostly rose in the last week, with prices of vegetable marking a third consecutive week of increases, the Ministry of Commerce said. Food accounts for about a third of China's consumer-price index, and food-price movements are closely watched as the government seeks to contain inflation. Average wholesale prices for 18 types of vegetables monitored by the ministry rose 3%, it said. Edible-oil prices rose 0.1%-0.2%, beef gained 0.4% and mutton increased 0.6%. Pork prices fell 1%, and have declined 10.7% since mid-September.

Corn (Source: CME)
US corn futures end higher, fueled by broader based buying across asset classes on more upbeat macroeconomic outlooks. Weakness in the US dollar following actions by major central banks to increase liquidity for European banks sparked investor confidence to add risk, analysts say. However, futures retreated from the initial highs, briefly slumping into negative territory, as traders' bearish psychology will need confirmation of a pickup in demand before they become aggressive buyers, Allendale's Rich Nelson says. Traders took profits on the early gains. CBOT March corn ended up 2 1/2c at $6.08/bushel, well off the intra-day high of $6.16.

Wheat (Source: CME)
US wheat futures end lower, failing to sustain strong early gains. The absence of supportive fundamental news specific to wheat, left futures without a demand based to justify higher price levels, analysts say. Futures initially spiked with other commodity markets on news of central bank's actions, but without a sign of fresh demand surfacing from recent declines, traders viewed that as a signal that US wheat remains uncompetitive in world export markets, analysts add. CBOT March wheat dipped 2c to $6.14/bushel, March KCBT wheat dropped 9c to $6.61, and March MGEX wheat ended down 10c at $8.23 1/2.

Rice (Source: CME)
US rice futures end sharply higher as speculators bought to cover shorts and commercial buyers added to their long positions. Technical buying was featured, with broader support from external markets helping futures correct deeply oversold conditions, analysts say. CBOT January rice finished up 3.2% at $14.83 1/2 per hundredweight.

U.S. wheat drops 0.7 pct; euro zone worries weigh
SINGAPORE, Nov 30 (Reuters) - U.S. wheat slid amid a broad-based weakness in the commodity marketsfollowing a near 4 percent rally in the last session, itsbiggest one-day gain in more than a month.
"Corn and wheat markets are generally tracking the outsidemarket as Europe's debt crisis is still playing in the minds ofinvestors," said Lynette Tan, an analyst at Phillip Futures inSingapore.

Firm cash seen limiting CBOT wheat/corn deliveries
CHICAGO, Nov 29 (Reuters) - U.S. grain traders largely expect no corn and wheat deliveries against the Chicago Board of Trade December contracts on Wednesday, the first notice day for deliveries, due to strong prices in the cash markets.
Eight traders and analysts polled by Reuters were expecting no deliveries in oats, but deliveries of 2,000 to 3,000 soyoil contracts and zero to 200 soymeal. Two of the eight said there could be large deliveries of wheat by speculators.

Dry, warm autumn brings risks for W.Europe grains
PARIS, Nov 29 (Reuters) - Unusually dry and warm autumn weather in western Europe could leave grains more vulnerable to a cold snap this winter in France and Germany and may already have led to some sowings being disrupted in Spain, analysts and crop experts said.
It was too early to predict potential losses and the arrival of rain and cooler weather in the coming weeks would ease the situation by strengthening plants, they said.

Argentina approves 2.7 mln tonnes more wheat for export
BUENOS AIRES, Nov 29 (Reuters) - Argentina's government approved an additional 2.7 million tonnes of 2010/11 wheat for export, boosting the total to 11.1 million tonnes, Agriculture Minister Julian Dominguez told reporters on Tuesday.
The country's deputy agriculture secretary told Reuters on Friday that between 2.5 million and 3.5 million tonnes of old season wheat would be cleared for sale abroad.

Rain and snow snarl final US harvest; rains on Plains
CHICAGO, Nov 29 (Reuters) - Rain and snow will slow final U.S. corn harvesting this week and more rain is set to fall on the Plains hard red winter wheat region by the weekend, an agricultural meteorologist said on Tuesday.
"It is certainly wet in the south and east Midwest with some snow. From 2 to 4 inches of snow can be expected today in the southeast and rain changing to snow by late today in southeast Illinois, Ohio and Michigan," said Don Keeney, meteorologist for MDA EarthSat Weather.

Weather stays good for Russia winter grain-forecaster
MOSCOW, Nov 29 (Reuters) - The weather in the next 10 days will remain favourable for the wintering of Russia's winter grain crop, the country's top weather forecaster said on Tuesday.
"Snow is lying to the east of Moscow, and 80 kms (around 50 miles) away snow is 13-16 cm (5-6 inches) thick, and it is even thicker in the regions along the Volga, Siberia and the Urals," Roman Vilfand, director of the Hydrometcentre weather forecasting service, told reporters.

Ukraine grain exports at 6.8 mln T so far 11/12
KIEV, Nov 29 (Reuters) - Ukraine has exported 6.8 million tonnes of grain so far in the 2011/12 season, including 2.09 million in November, Serhiy Kvasha, the head of the Agriculture Ministry's markets department, was quoted as saying on Tuesday.
Interfax Ukraine news agency quoted Kvasha as saying the volume included 2.14 million tonnes of wheat, 1.8 million of barley and 2.76 million of maize.

Majority Of UK Crops Developed Well Despite Dry Autumn - HGCA (Source: CME)
The majority of U.K. crops have developed well, despite a mild, dry autumn with parts of the country had cumulative rainfall of less than 70% normal, the Home Grown Cereals Authority, or HGCA, said. The HGCA said that air temperatures peaked at six degrees above normal in October and over two degrees above normal in November. Such conditions allowed farmers to make good progress with the drilling of oilseed rape, winter cereals and field beans, with all planned crops now in the ground bar occasional first wheat crops due to late harvested roots. "The exception was in Scotland where the wet harvest, delays in baling straw and continuing wet weather caused some delays," the HGCA said. Regarding wheat, September sown crops that went into moist seedbeds are at mid-tillering and October sown crops remain at early tillering, the HGCA said. The winter wheat crop is now well established, the HGCA said, with lush growth.
"Weed control has been good where moisture was available to activate pre-emergence herbicides, but has been more variable in dry conditions," said the HGCA. The drier conditions have resulted in the lowest levels of slug activity over recent years, but parts of Scotland, Wales and the North East experienced wed cloddy seed beds that favored slugs, the HGCA said. The main disease present amongst the winter wheat crops this autumn is mildew, encouraged by mild, damp weather and lush crops, however most of the crops are well established enough to withstand, the HGCA said. "There are some reports of yellow rust and brown rust pustules in susceptible varieties, but as yet they aren't at levels to cause concern," the HGCA said.

ICE sugar falls early, tracks commodity setback
LONDON, Nov 30 (Reuters) - ICE sugar, cocoa and coffee futures fell in early trade, tracking widespread losses in commodities as markets eyed the deepening debt crisis in the euro zone.
ICE raw sugar futures fell in early trade but continued to hold above last week's 5-1/2 month low.

World sugar consumption to hit 201 mln T by 2020-ISO
LONDON, Nov 29 (Reuters) - World sugar consumption is set to grow to 201 million tonnes by 2020, growing by an average 2.02 percent a year, the International Sugar Organization (ISO) said on Tuesday.
ISO senior economist Leonardo Bichara Rocha told the annual ISO seminar that 60 percent of world consumption growth by 2020 would come from the Far East and the Indian sub-continent.

Africa's coffee output to rise by a third by 2015
NAIROBI, Nov 24 (Reuters) - Africa's coffee output could leap by a third within the next five years as farmers scramble to replace mature trees with disease-resistant seeds to cash in on soaring global prices for the beans, a senior industry official said.
Poor prices, drought, disease and political instability in major producers such as Ivory Coast have led to neglect of coffee farms, while some farmers ditched the commodity in favour of planting staple foods such as maize.

Brazil cane output seen down for first time in decade
LONDON, Nov 29 (Reuters) - Centre-south Brazil is on track to produce 490 million tonnes of sugarcane in 2011/12, representing the first fall in sugar production in the South American country in a decade, Plinio Nastari, president of consultancy Datagro, said on Monday.
He told the annual International Sugar Organization (ISO) seminar that he expected total sugar production in Brazil to fall to 35.4 million tonnes in 2011/12 from 38.0 million in 2010/11. Brazil is the world's top sugar producer and exporter.

Thailand sees record 2011/12 sugar output at 9.9 mln T
BANGKOK, Nov 29 (Reuters) - Thailand, the world's second-biggest sugar exporter, has started its 2011/12 crushing season and is forecast to produce a record 9.9 million tonnes of the sweetener this year and may export  7.5 million tonnes in 2012, a senior official said on Tuesday.  
Although the forecast was more or less within market expectations of around 9.5 million to 10 million tonnes of sugar and largely unaffected by the floods, more supply from Thailand could put pressure on Thai premiums, a key indicator of demand.

Weather seen taking toll on Brazil '12 coffee-coop
BRASILIA, Nov 29 (Reuters) - Brazil's 2012 coffee harvest will be smaller than the last 'on-year' crop in 2010 because of bad weather that has taken a heavy toll on trees, local cooperative Cooparaiso said on Tuesday.
The coop is still preparing its output estimate for the world's top coffee grower, though it joins a growing number of local producers and exporters in dismissing the idea the next crop will be the boom year that some foreign analysts predict.

Cuban sugar harvest gets under way, 20 pct rise seen
HAVANA, Nov 29 (Reuters) - Cuba's 2011-2012 sugar harvest got under way on Tuesday as cane cutting began in Eastern Guantanamo province, official media reported, amid optimism that improved organization and more cane will translate into a 20 percent increase in raw sugar production.
The first of 46 mills was scheduled to open on Wednesday, and a second on Thursday, with plans calling for output to reach 1.45 million tonnes by the time the season ends in April, compared with 1.2 million tonnes Reuters estimates was produced during the previous harvest.

Indian cane expansion faces constraints- miller
LONDON, Nov 29 (Reuters) - Prospects to boost sugarcane production in India are constrained by limitations in availability of land, water and power, a senior Indian miller said on Tuesday.
India is the world's number 2 sugar producer after Brazil and is the world's leading consumer of the sweetener.

Brazil cane output seen down for first time in decade
LONDON, Nov 29 (Reuters) - Centre-south Brazil is on track to produce 490 million tonnes of sugarcane in 2011/12, representing the first fall in sugar production in the South American country in a decade, Plinio Nastari, president of consultancy Datagro said on Monday.
He told the annual International Sugar Organization (ISO) seminar that he expected total sugar production in Brazil to fall to 35.4 million tonnes in 2011/12 from 38.0 million in 2010/11. Brazil is the world's top sugar producer and exporter.

Record Cotton Crop Spurs Goldman to Predict Declining Prices: Commodities (Source: Bloomberg)
The combination of a record cotton crop and falling consumption will expand global stockpiles by the most since 2005, driving further declines in the price of this year’s worst-performing commodity. Harvests will increase 7.5 percent to 123.89 million 480- pound bales (27 million metric tons) in the 12 months ending in July, as demand drops to a three-year low of 114.27 million bales, the U.S. Department of Agriculture estimates. Prices may decline 15 percent to 77 cents a pound on ICE Futures U.S. in New York by the end of next year, from 90.91 cents now, based on the median of 12 analyst estimates compiled by Bloomberg. “It’s a double whammy,” said James Dailey, who manages $215 million of assets at TEAM Financial Management LLC in Harrisburg, Pennsylvania. “Cotton is facing the worst-case nightmare for a commodity, where you have a glut in physical production combined with weakening demand.”

COAL STOCKS AT MAJOR CHINA POWER PLANTS AT RECORD -NDRC
BEIJING, Nov 29 (Reuters) - Coal stocks in China's major power plants were at a record high of 80.15 million tonnes on Nov 20, enough to generate electricity for 21 days, the National Development and Reform Commission said on Tuesday.
Coal stocks at Qinhuangdao, the main port used to ship coal from northern China to the country's south, were at 6.78 million tonnes, which was up 14.7 percent from a year earlier and at a reasonable level, the commission said.

China unlikely to import gasoil for domestic use in Dec - trade
SINGAPORE, Nov 29 (Reuters) - China will likely stay away from the diesel spot market and not import the product for domestic use in December as ramped-up run rates from the country's top refiners are sufficient to meet domestic demand, industry sources said on Wednesday.
Leading oil refiner China Petroleum & Chemical Corp (Sinopec)   does not plan to import any gasoil for December, after importing an unusual 200,000 tonnes for November to cover domestic shortages, a source familiar with the matter said.  

U.S. crude oil imports down in September-EIA
WASHINGTON, Nov 29 (Reuters) - U.S. crude oil imports continued to decline, falling 223,000 barrels per day in September from a year earlier, the Energy Information Administration said on Tuesday.
Crude imports averaged 9.006 million bpd in September, down 2.4 percent from the 9.229 million bpd imported during the month in 2010.

Oil Trades Near Two-Week High on Bank Liquidity Move, U.S. Economy Outlook (Source: Bloomberg)
Oil traded near a two-week high in New York as steps by six central banks to make funds available and ease strains from Europe’s debt crisis countered a more-than projected rise in U.S. crude stockpiles. West Texas Intermediate futures were little changed after rising 0.6 percent yesterday, capping a second month of gains. The Federal Reserve and five other banks cut the cost of emergency funding for European banks. The Energy Department said U.S. oil supplies rose by 3.9 million barrels last week, compared with a forecast for a 50,000 barrel increase in a Bloomberg News survey. The U.K. said it’s pulling some diplomats out of Tehran after its embassy was attacked.
“Central bank intervention should have provided a stronger lead for oil, but there was that inventory build,” said Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney, who sees technical resistance for New York crude at about $102.20. “The market is not looking at what’s happening in Iran. If it starts to develop then you may see a restriction of Iranian oil supply to Europe and that could push the spread between WTI and Brent back out.”

IRON ORE-SPOT AT 3-WEEK LOW, SHANGHAI REBAR SLIPS
SINGAPORE/SHANGHAI, Nov 30 (Reuters) - Offer prices for iron ore fell further on Wednesday as spot rates dropped to three-week lows with steelmakers in top producer China largely staying out of the market amid thin demand.
Iron ore with 62 percent iron content dropped 0.9 percent to $130.80 a tonne on Tuesday, said the Steel Index, the lowest since Nov. 8.

BALTIC INDEX RISES FOR 2ND DAY, RATES SEEN CAPPED
LONDON, Nov 29 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose for a second session on Tuesday helped by firmer bookings on the larger capesizes.
Nevertheless, the shipping sector was set to see more turmoil in the coming months as a supply glut and growing economic gloom would keep earnings under pressure.