Corn (Source: CME)
US corn futures finish at record high as USDA increases supply concerns by slashing its inventory outlooks more than expected. Traders worry poor weather will prevent farmers from harvesting a large crop. USDA projects inventories will dwindle in the coming year even if they harvest a record crop. "Corn traders will likely stay on their buying spree and bring buyers to the other grains as well," predicts John Roach of Roach Ag Marketing. CBOT July corn closes up 21 1/2c at $7.85 1/2 a bushel, topping the previous high close of $7.76 from April.
Wheat (Source: CME)
US wheat futures fall as federal forecasters raise their outlook for global inventories. The increases for 2010-11 and 2011-12 season-ending stocks were "decidedly bearish," writes Doane Advisory Services. Traders say there is enough wheat to go around, particularly low-quality wheat that can be used to feed livestock. In the US, the harvest is accelerating in the South, bringing new supplies in from the fields. The USDA estimated output above expectations. CBOT July wheat drops 3c to $7.45/bushel, KCBT July loses 13 3/4c to $8.71 1/4 and MGE July slips 3/4c to $10.20 3/4.
Rice (Source: CME)
US rice futures rise as the USDA cuts its view on ending stocks due to planting disruptions from flooding. The 2011-12 inventory forecast drops 13% from last month to 42.1M hundredweight. The outlook declines, as planted area was lowered 5.6% to 2.85M acres. Flooding in the Mississippi River Delta in the mid-South reduced plantings, with long-grain rice in Arkansas and Missouri accounting for most of the losses. CBOT July rice jumps 16 1/2c to $14.94 per hundredweight.
Russian wheat offered in port, export outlook up
GELENDZHIK, Russia, June 8 (Reuters) - The Russian grain industry expects to make strong return to the export market in the coming crop season, with sentiment lifted by the prospects for a large harvest and sizeable stocks from earlier years.
While forecasts vary, several experts at the Russian Grain Union's XII International Grain Round said they expected wheat exports of 10 million tonnes, and that resistance from disgruntled North African and Middle Eastern clients who lost deliveries to last year's grain export ban will be limited.
French farm body sees plunge in wheat crop, exports
PARIS, June 8 (Reuters) - French soft wheat production is expected to fall 13 percent in 2011 to a four-year low after a drought-affected growing season, the country's farm office said on Wednesday in its first forecasts for the upcoming harvest.
FranceAgriMer estimated this year's French wheat crop would drop to 31 million tonnes from 35.6 million in 2010, with the average yield seen down 15 percent at 6.15 tonnes per hectare.
Rains return to the US Midwest, stall late planting
CHICAGO, June 8 (Reuters) - Showers will begin late Wednesday in the western U.S. Midwest and continue off and on through the weekend, ending a week-long stretch of mostly clear skies that promoted late planting, a forecaster said Wednesday.
"I would think the onset of this rain would put an end to any further corn planting. Farmers will either take prevent planting or go to soybeans," said Telvent DTN forecaster Mike Palmerino.
Canada farm department lowers crop area due flooding
WINNIPEG, Manitoba, June 8 (Reuters) - Canada's agriculture department has lowered its estimates of crop harvested areas, as flooding and excessive rain look to leave much land fallow this year.
Agriculture Canada released its grain and oilseed outlook, which is based on analysis not a farmer survey, late on Tuesday.
Monsoon to reach India's rice areas this weekend
NEW DELHI, June 8 (Reuters) - Monsoon rains are expected to arrive over India's main rice growing areas this weekend, which could help erase an initial delay in planting of the main summer food crop, weather office sources said on Wednesday.
Monsoon normally spreads to the rice belt of West Bengal and Orissa states in the east by the first week of June, but this year it had paused for about three days.
U.S. wheat rallies as crop forecasts shrink
CHICAGO, June 8 (Reuters) - Hot and windy weather is helping the Kansas wheat harvest progress rapidly, and yield reports are widely variable.
The weather likely stressing any late-filling hard red winter wheat in southern Kansas, but further northward conditions are generally favorable. Hot and dry weather permitting active harvest of winter wheat in drought-plagued Texas and Oklahoma.
US corn adds to gains ahead of USDA report
SYDNEY, June 9 (Reuters) - U.S. corn futures edged up adding to nearly 4 percent gains in the previous session ahead of a U.S. government report likely to forecast reduced corn output and a sharp reduction in old-crop stocks.
"Corn consumption in the U.S. has been quite high, particularly for use in ethanol production where demand has been quite sticky and has shown little sign of abating despite high prices," said Luke Mathews, an agricultural commodities strategist at Commonwealth Bank of Australia.
Late sowing, high demand trim US corn stocks - trade
WASHINGTON, June 9 (Reuters) - The U.S. government will forecast tighter corn supplies through the fall of 2012 thanks to a cold, rainy spring that took the top off this year's crop, analysts said ahead of an update of crop prospects.
Strong demand by livestock feeders and ethanol makers will mean smaller-than-expected supplies this summer, they said. And the new corn crop, even if it is record-large, would barely meet demand during the marketing year that opens on Sept. 1.
US corn adds to gains ahead of USDA report
SYDNEY, June 9 (Reuters) - Analysts expect the U.S. Department of Agriculture (USDA) monthly supply and demand report at 1230 GMT to cut the end 2010/11 estimate for U.S. corn stocks to 706 million bushels, from 730 million bushels forecast in May.
"Corn consumption in the U.S. has been quite high, particularly for use in ethanol production where demand has been quite sticky and has shown little sign of abating despite high prices," said Luke Mathews, an agricultural commodities strategist at Commonwealth Bank of Australia.
EU grain output revised down on low rain-attache
WASHINGTON, June 8 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in the European Union:
"With significantly less rainfall than normal recorded in the past three months in the key growing areas in France, Germany and the UK, farmers are reported to be increasingly concerned about both grain yield and quality, particularly in northwestern France. As such, the EU27 grain crop forecast is now revised downward to 277 million tonnes. The focus firmly remains on the EU ending stock number despite a reduction in forecast feed and industrial grain usage and in exports."
France To Help Drought-Hit Farmers With Around EUR1B-Prime Minister (Source: CME)
France will make available around EUR1 billion of aid through a variety of mechanisms to help farmers suffering from the impact of drought, French Prime Minister Francois Fillon said. "It is our independence and food security that is at stake," Fillon told senators. "In addition to emergency measures for transport and fighting speculation in animal feed, the President [Nicolas Sarkozy] has announced an expression of national solidarity that I would put at EUR1 billion," he said. Fillon said the figure is not very precise as it depends on the quantity of requests made by farmers. Firstly, the government will ensure that the necessary credits are available from its national agricultural emergency fund. A payment of EUR200 million will be made into the fund to respond to the most urgent cases, Fillon said. Secondly, the state will grant an exoneration from taxes on land without buildings for around EUR350 million.
Thirdly, the government will delay repayments of loans taken out by farmers in 2010 as part of state support for agriculture during the economic crisis, Fillon said. All the aid will be distributed through procedures that are accepted by the European Union, Fillon added.
Crop Weather Mayhem Delays U.S. Corn, Rice Planting as Prices Extend Gains (Source: Bloomberg)
When the overflowing Mississippi River breached Arkansas’s levees and flooded Michael Oxner’s farm in May, the waters didn’t just wipe out his hopes of planting 1,400 acres of rice. It destroyed last year’s crop, too. Water inundated the bins that held the rice he’d harvested in 2010, ruining 25,000 bushels and leaving a fermented smell that turned his remaining grain into pet food. Oxner lost $375,000 in 2010 rice alone. His rice land, along with 300 acres planted with corn, won’t be usable this season, Bloomberg Businessweek reports in its June 13 issue. Since it’s too late to plant more corn, the 2,000 acres he has left will go into soybeans, which grow faster than other crops but fetch less on the market. Even with soybeans, Oxner is cutting it close: Soybeans usually go into the fields in May. This year’s planting started on June 4.
Corn Trades Near Three-Year High Almost 40 Cents More Expensive Than Wheat (Source: Bloomberg)
Corn for July delivery traded little changed at $7.8475 a bushel after jumping as much as 3.8 percent yesterday to the highest level in three years following the U.S. Department of Agriculture’s estimate cutting supplies.
China a wild card for commodities- MF
NEW YORK, June 8 (Reuters) - China is a wild card for global commodity prices, but with a slowing economy it's a more likely trigger to a downdraft than the U.S. dollar, a senior analyst at brokerage MF Global said on Wednesday.
China has been the world's growth engine for the past decade. But with an annual growth rate close to double-digits and an undervalued currency, the government has been trying to tap down a rising pace of inflation.
China's commodity imports seen subdued in May
BEIJING, June 9 (Reuters) - Chinese trade data on Friday may show imports of major commodities were subdued in May, with an expected revival in copper shipments not yet underway and crude oil cargoes hit by higher prices after four months of bumper volumes.
The standout may be the soybeans trade, which is thought to have gathered pace in May after a lull in seemingly insatiable demand from the world's biggest buyer.
Coffee, cocoa firm, sugar slips, soft dollar underpins
LONDON, June 9 (Reuters) - ICE arabica coffee futures firmed early with upside capped by Brazil's harvest, while cocoa edged up, although potential further gains were limited by a steady flow of supplies from top producer Ivory Coast. Liffe white sugar futures eased, consolidating after rising to a six-week high this week, driven by shortages during a period of high demand before Ramadan in August.
Cotton area jumps in India's Punjab, Haryana
CHANDIGARH, India, June 9 (Reuters) - Farmers in India's northern Punjab and Haryana states have raised area under cotton for 2011/12 cotton year beginning in October after they received higher prices this year, state farm ministry officials said.
Cotton marketing year in India runs from October to September, though farmers start cultivation from May onwards.
Brazil mills to shift more cane to ethanol-analyst
SAO PAULO, June 8 (Reuters) - Brazil's center-south could divert slightly more cane to ethanol production than initially expected in the current season as prices of the fuel remain buoyed by strong demand, Job Economia analysts said Wednesday.
After reaching record levels earlier this year, prices of the fuel slumped in early May with the start of the 2011/12 cane crop harvest but then stabilized again in recent weeks.
Brazil cocoa arrivals pick up after shaky start
SAO PAULO, June 8 (Reuters) - Deliveries of Brazil's mid-crop cocoa to local warehouses in the last week improved after appearing to stagnate in the previous fortnight, data from Bahia Commercial Association showed.
Arrivals from top cocoa state Bahia rose to 76,321 60-kg bags in the week to June 1 from 64,115 bags in the previous week, resuming their upward trajectory as the mid-crop advances.
US ethanol production climbs to 915,000 bpd-EIA
KANSAS CITY, June 8 (Reuters) - U.S. ethanol production rose to the highest level since late January in the latest reporting week, even as stocks dropped to their lowest in six weeks, the government said on Wednesday.
Ethanol output totaled 915,000 barrels per day (bpd) for the week ended June 3, up 6,000 bpd from the prior week, the Energy Information Administration said.
Ivory Coast cocoa prices firm on rising demand
ABIDJAN, June 8 (Reuters) - A purchase manager for an international exporter said local grinders were buying enough beans to run their factories with prices ranging from 775 CFA francs ($1.73) to 875 CFA francs compared with an average of 850 CFA francs the previous week.
"The price margin is wide because there is a lot of humidity and mouldy beans in the deliveries," the manager said, requesting not to be named.
India allows extra 1 mln bales of cotton exports
NEW DELHI/MUMBAI, June 8 (Reuters) - India allowed an extra one million bales of cotton exports on Wednesday and will review within two months whether to permit further overseas sales of the fibre at a time when global demand appears to be flagging.
India, the world's second biggest grower and exporter of the fibre, had already allowed 5.5 million bales (1 bale = 170 kg) in the current cotton year which started in October.
Mauritius 2011 sugar output seen falling 7 pct
PORT LOUIS, June 8 (Reuters) - Mauritius' sugar output is seen falling to 420,000 tonnes this year from 452,473 tonnes in 2010 largely due to a reduced area under cultivation and poor weather, the Chamber of Agriculture said on Wednesday.
Sugar, a centuries-old pillar of the Indian Ocean island's now almost $10 billion economy, accounts for roughly 3 percent of gross domestic product and is a major employer.
Sugar shortage to ease in Q4 with more EU supply
LONDON, June 8 (Reuters) - Acute refined sugar shortages are likely to ease in the fourth quarter of this year when fresh EU supplies are expected to enter the world market.
Liffe white sugar futures have surged due to a cocktail of factors including high seasonal demand before Ramadan in August, port loading delays in Brazil, insufficient demand by refiners for raw sugar earlier this year and fears over tight EU supplies due to dry weather.
Indian mills to seek nod for more sugar exports
NEW DELHI, June 8 (Reuters) - India's sugar mills will soon seek government permission to export an additional half a million tonnes of the sweetner as output is expected to rise in the next season from October, the chief of a leading industry body said on Wednesday.
"Now, it makes sense to export another 500,000 tonnes this season," Abinash Verma, director general of the Indian Sugar Mills Association (ISMA), a producers' body, told Reuters in an interview.
Oil Near Highest This Month Heads for Weekly Gain on U.S. Economy, OPEC (Source: Bloomberg)
Oil traded near the highest this month in New York, heading for a weekly increase, after the U.S. trade deficit unexpectedly narrowed and OPEC failed to reach an accord on output targets. Futures were little changed, with the biggest weekly gain in four weeks, after the Commerce Department said the trade gap shrank 6.7 percent to $43.7 billion, the lowest since December. A separate report showed jobless claims unexpectedly rose. The Organization of Petroleum Exporting Countries on June 8 failed to agree quotas for the first time in at least 20 years.
Rising mining costs may trigger sector correction
LONDON, June 8 (Reuters) - Consensus forecasts for miners' earnings are failing to price in the full impact of rising costs, a gap that could trigger a correction in the sector's shares after the summer results season.
Rises in both capital and operating costs have become a growing problem for the booming industry, which faces ever higher price tags for everything from skilled labour to power, maintenance and even explosives and prefabricated buildings.
Gold Futures Rise as Higher Energy Costs Boost Demand for Inflation Hedge (Source: Bloomberg)
Gold rose for the first time in three days on speculation that higher energy costs will boost demand for the precious metal as a hedge against inflation. Palladium futures jumped to a three-month high. Crude oil topped $102 a barrel in New York after the Organization of Petroleum Exporting Countries failed to reach an agreement on production targets. Federal Reserve Chairman Ben S. Bernanke signaled this week that there won’t be a third round of so-called quantitative easing and U.S. interest rates will remain low.
METALS-Copper slips, China helps shore up sentiment
LONDON, June 9 (Reuters) - Copper was softer on Thursday as traders fretted about further signs of U.S. economic weakness, but prices were buttressed by expectations of higher demand from top consumer China.
Benchmark copper on the London Metal Exchange was trading at $8,960 a tonne at 1010 GMT from $9,045 a tonne at the close on Wednesday.
The metal used widely in power and construction slid to near $8,500 a tonne last month on fears of dwindling consumption.
PRECIOUS-Gold steady; palladium firms on auto recovery
SINGAPORE, June 9 (Reuters) - Spot gold held steady on Thursday as a wait-and-see sentiment prevailed on future U.S. monetary policy moves, while palladium strengthened as the automobile sector recovers from the Japan earthquake in March.
The dollar index edged lower, as the euro was underpinned by expectations that the European Central Bank will likely flag a July rate hike at a meeting later in the day.
Copper Falls to One-Week Low as Rising Global Interest Rates May Curb Use (Source: Bloomberg)
Copper fell to a one-week low on speculation that demand will wane as central banks worldwide raise borrowing costs to curb inflation. European Central Bank President Jean-Claude Trichet signaled an interest-rate increase next month, saying “strong vigilance” is warranted to contain consumer prices. Last month, nations from Norway to India boosted borrowing costs. Inflation risks in the U.S. are “clearly to the upside,” Philadelphia Federal Reserve Bank President Charles Plosser said today.
Chile copper mine protest drags on, no end in sight
SANTIAGO, June 8 (Reuters) - A strike by contract workers that has halved output at the world's No. 5 copper mine, El Teniente in Chile, entered its 15th day on Wednesday with no end in sight as wage talks stalled, protest leaders said.
Mine owner Codelco slowed output at the world's top underground copper operation over the weekend after protests by contractors turned violent and forced staff workers to stay home.
Baosteel cuts July steel product prices by 100-200 yuan/tonne
BEIJING, June 9 (Reuters) - Leading Chinese steelmaker Baoshan Iron and Steel will cut prices for July delivery of its major products by 100-200 yuan ($15-30) per tonne, it said on Thursday.
It said in an announcement on its website that prices of hot-rolled products would be cut by 200 yuan compared with June, while cold-rolled steel prices would fall by 100 yuan
Africa may turn major iron ore exporter after 2020
CAPE TOWN, June 8 (Reuters) - Africa, regarded as the next iron ore frontier, is only likely to boost global supply from 2020 and only if countries overcome infrastructure and political hurdles, analysts and producers said this week.
The market for iron ore, used in stainless steel production, is the second biggest commodity trading market in the world, valued at some $150 billion, said Phillip Killicoat, iron ore manager at Credit Suisse commodities.
