Monday, June 20, 2011

20110620 1836 FCPO EOD Daily Chart Study.

FCPO closed : 3193, changed : -5 points, volume : lower.
Bollinger band reading : downside biased with possible pullback correction.
MACD Histrogram : turned upward, seller take profit.
Support : 3150, 3100, 3070, 3050 level.
Resistance : 3200, 3250, 3270, 3300 level.
Comment :
32 points range FCPO closed recorded small loss with slower volume changed hand while overnight last Friday closed recorded soy oil closed recorded loss and currently rebounding little higher.
Export reported for the period of 1~20 Jun 2011 showing sustaining demand however rising production level seems outpaced export thus leading price litter lower today while World Oilseed Conference starts today in Turkey.
Daily chart formed a down doji bar candle with longer upper shadow positioned little higher from lower Bollinger band level after market opened higher, traded range bound and closed near the low of the day.
Chart reading remained suggesting a downside biased market development with possible pullback correction testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110620 1745 FKLI EOD Daily Chart Study.

FKLI closed : 1555 changed : 1 points, volume : lower.
Bollinger band reading : correction range bound little upside biased.
MACD Histrogram : recovering, buyer seller battling.
Support : 1550, 1540, 1530, 1515 level.
Resistance : 1565, 1580, 1590, 1600 level.
Comment :
FKLI closed 2 ticks higher with half of last Friday volume exchanged doing 4 points discount compare to cash market that closed recorded loss while Asia and Europe trading mostly lower despite last Friday U.S. market closed little higher.
A possible Greek default due to European leaders fails to agree on aid payout dragged on market negative sentiment.
Daily chart formed a down doji bar candle positioned between middle and upper Bollinger band level after market opened higher, traded side way within tight range market followed by second session downward movement before recovered slightly to closed off the low of the day.
Again, FKLI still likely to trade in correction range bound little upside biased development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110620 1020 Global Economic Related News.

China: Existing home market cools in May amid government curbs
China’s effort to cool home prices is damping the market for existing homes, with prices in May falling from the previous month in 23 of 70 cities measured. That’s more than the 16 cities that posted declines in April, data from the National Bureau of Statistics posted to its website June 18 showed. Existing home prices in Beijing fell 0.2% from April while those in Shanghai increased 0.2%. The price of new homes, typically sold by developers, rose last month in 67 of the 70 cities monitored. (Bloomberg)

India: Signals slower pace of rate increases on global risks
India’s central bank signaled it may slow the most aggressive monetary tightening among Asia’s major economies as risks to global growth threaten to undermine consumer demand. Asian nations such as China and the Philippines refrained from boosting interest rates this week, pausing to gauge the strength of the global economy. The Reserve Bank of India said lead indicators suggest growth moderated in advanced and emerging countries, and uncertainty about the resolution of Europe’s sovereign debt crisis has “increased.” (Bloomberg)

Japan: Yen heading to new high on no intervention as fed rates on hold
As the Yen rallies to levels that prompted the Group of Seven to weaken the currency in March, traders are forecasting more gains, even as Japan falls into its third recession in a decade. Three months ago, the Yen soared as much as 8.5% in less than a week on speculation insurance companies would repatriate assets to pay for damages from the record earthquake and tsunami in northeastern Japan that triggered the worst nuclear disaster in 25 years. Now, politicians and central bankers are focused more on the slowdown in US growth, Europe’s sovereign-debt crisis and uprisings in the Middle East. (Bloomberg)

Singapore: Exports rebounded in May as pharmaceutical companies shipped more goods to customers, offsetting a slump in electronic sales. Non-oil domestic exports gained 7.8% YoY, after a revised 2% YoY decline in April, the island's trade promotion agency said in a statement. (Source: Bloomberg)     

E.U: Exports rose in April on greater demand from the U.S. and China, shrugging off the effects of a stronger euro. Exports from the economy of the 17 nations that use the euro rose a seasonally adjusted 0.6 % MoM from March, when they increased by the same amount. Euro-region construction output rose 0.7% MoM from the previous month, when it declined 0.1% MoM, a separate report showed. (Source: Bloomberg)

UK: Facing larger deficit because of weak economy
The Office for Budget Responsibility, Britain’s independent fiscal watchdog, said in March the government’s fiscal shortfall will be GBP368bn (USD596bn) between 2011 and 2016, GBP46bn more than Osborne predicted in October, as it lowered its 2011 growth estimate. The economy stagnated in the six months through March, while consumer spending slumped the most in almost two years in the first quarter. Surveys of manufacturing and services growth published earlier this month by Markit Economics Ltd. indicate economic growth this quarter may not exceed 0.3%. (Bloomberg)

US: Leading indicators rise in sign of growth rebound
The index of US leading indicators rose more than forecast in May after declining for the first time in almost a year, a sign economic growth may pick up by the end of 2011. The Conference Board’s gauge of the outlook for the next three to six months rose 0.8% after a revised 0.4% drop in April, the New York-based research group said. Another report showed consumer sentiment dropped more than forecast in June. (Bloomberg)

U.S: Consumer sentiment declines more than forecast in June as households contended with higher prices that are eating into incomes amid slowing job growth. The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 71.8 from 74.3 in May. (Source: Bloomberg)

Global: IMF cuts U.S. growth forecast, sees European contagion risk. The U.S. economy will grow 2.5% this year, down from 2.8% projected in April, the IMF said, citing higher commodity prices and bad weather in the first quarter and a weak housing market. The IMF forecasts 2.7% growth in 2012, slower than the previous estimate of 2.9%. The Washington-based IMF sees the world economy expanding 4.3% this year, down from 4.4% two months ago. It left a 4.5% forecast for next year unchanged. (Source: Bloomberg)

20110620 1019 Malaysia Corporate Related News.

KLCI chart reading :
correction range bound upside biased.

Iskandar Malaysia enters second phase of development
The Iskandar Regional Development Authority (IRDA) is seeking higher allocation of funds from the Government in the upcoming Budget 2012, compared with 2011. For 2011, the Government had allocated RM945m to the economic growth corridor in Johor. IRDA CEO Ismail Ibrahim said the allocation of funds for 2012 is presently being discussed with the Government’s Economic Planning Unit.(Starbiz)

Sarawak Plantation to expand planted land
Sarawak Plantation (SP) is in advanced negotiations to acquire a 3,000ha matured oil palm plantation from a private company in northern Sarawak. Group MD Datuk Hamden Ahmad said SP was now carrying out a survey on the land, particularly on the conditions of the oil palm trees, which were between seven and eight years old. (StarBiz)

ADCB sells RHB shares at RM10.80 each
Abu Dhabi Commercial Bank PJSC (ADCB) has signed an agreement with its sister company Aabar Investments PJS to sell its 24.9% stake in RHB Capital to the latter for RM10.80 per share. ADCB CEO Ala'a Eraiqat said the sale was expected to enhance the company's first-half year profitability and would result in the release of capital. Upon completion of the transaction, ADCB's tier-1 ratio would increase to 14.43% from 12.39% while capital-adequacy ratio would rise to 21.11% from 17.03%. Ala'a said while ADCB had benefited tremendously from its ownership in RHB Cap, the management and board were now clearly focused on executing its strategy of being a UAE-centric bank. (Starbiz)

EPF in SGD3.2bn Singapore project
The Employees' Provident Fund (EPF) has entered into a joint-venture agreement with Singapore's GuocoLand group to develop a piece of land for mixed-used development above Singapore's Tanjong Pagar MRT station.A statement from GuocoLand Ltd said the agreement was for the development of a piece of land at Peck Seah Street and Chon Guan site, known as the Tanjong Pagar White Site. The EPF purchase and 20% joint-venture involvement in the upcoming SGD3.2bn mixed-use development marks another milestone for the pension fund, which has been on an acquisition trail since unveiling its interest in acquiring property assets since August 2010. (Starbiz)

No capital outlay from Naim
Naim Holdings (Naim) will not have to come up with any capital outlay in implementing the RM2.5bn Sabah oil and gas terminal project. MD Datuk Hasmi Hasnan said the project, a JV between South Korea's Samsung Engineering and Naim, was implemented under an alliance concept whereby the JV partners were not allowed to carry out any construction works. (StarBiz)

Vehicle sales down in May
Total vehicle sales fell 9.5% in May to 46,045 units from 50,883 a year earlier due to a shortfall in production for the month of April. This was a result of insufficient supply to cater to deliveries stemming from the impact of the earthquake and tsunami that hit Japan in March. The drop in sales marked the biggest decline of the year since February when local vehicle sales fell to 40,387 units from 40,654 in January. However, for the five-month period ended May 2011, cumulative sales were still higher at 255,413 units from 247,110 in the previous corresponding period, said the Malaysian Automotive Association. (StarBiz)

Talam reprimanded for rules breach
Talam Corp has been reprimanded by Bursa Malaysia for a breach of the Main Market listing requirements. The regulator said due mainly to Talam's oversight and errors, there was a difference of RM1.2m (or a 17.2% deviation) in profit after taxation and minority interest between the unaudited and audited results of the company for FYE 31 Jan 2010. (StarBiz)

Sunway terminates deal in Sri Lanka
SunwayMas SB and textile and garment manufacturer Dasa Tourist Complex Ltd, based in Sri Lanka, have mutually terminated a joint-venture agreement. Property developer SunwayMas is a wholly-owned subsidiary of Sunway Holdings. The termination was due to both companies being unable to fulfill their obligations in accordance with the terms and conditions of the agreement, said Sunway Holdings. (StarBiz)

F&N Holdings: Aims for regional expansion. Fraser & Neave Holdings Bhd is keen to buy another food company to expand and become a regional food and beverage group. Last year, it spent some RM55m for 23% stake in Cocoaland Holdings Bhd. It also aims to double its dairy business in Thailand over the next five years. (Source: Business Times)

Genting: Hires architect for USD3b Resorts World Miami. In just three weeks from Genting Malaysia Bhd's successful USD236m (RM717m) bid for a 13.9-acre (5.6ha) waterfront land in northern downtown Miami, Genting Group chieftain Tan Sri Lim Kok Thay announced the hiring of Miami-based Arquitectonica to create the master plan for its USSD3b Resorts World Miami mixed development, though a casino licence is not yet within reach.

SPB: To expand planted land. Sarawak Plantation Bhd (SPB) is in advanced negotiations to acquire a 3,000ha matured oil palm plantation from a private company in northern Sarawak. Group MD Datuik Hamden Ahmad said SPB's target is to expand its plantation by at least 5,000ha a year while the group's capital expenditure is between RM30m and Rm40m a year. (Source: The Star)

TSH: Young plantations start ielding returns. TSH Resources is entering harvest time. So far, only 36% of its Indonesian palms are currently in the mature phase. TSH plans to acquire more land in Kalimantan and if all goes well, chairman Datuk Kelvin Tan Aik Pen expects two acquisitions in the current financial year. (Source: The Edge Daily) 

20110620 1010 Global Market Related News.

 DJIA chart reading : correction range bound downside biased.

Hang Seng chart reading : downside biased with possible pullback correction

Asia Stocks Gain, Snapping Seven Weeks of Losses, as Australian Banks Rise (Source: Bloomberg)
Asian stocks rose, snapping seven straight weeks of decline, as Australian banks, seen by some investors as a refuge amid Europe’s sovereign debt crisis, advanced, and Japanese automakers rallied.

Asian Stocks Rise on Optimism Europe to Force Greek Austerity (Source: Bloomberg)
Asian stocks rose, snapping seven straight weeks of decline, on optimism the European Union will force Greece to deliver on debt-reduction commitments. Australian banks, seen by some investors as a refuge amid Europe’s sovereign debt crisis, advanced.

U.S. Leading Indicators Rise in Sign Growth May Pick Up by End of the Year (Source: Bloomberg)
The index of U.S. leading indicators rose more than forecast in May after declining for the first time in almost a year, a sign economic growth may pick up by the end of 2011. The Conference Board’s gauge of the outlook for the next three to six months rose 0.8 percent after a revised 0.4 percent drop in April, the New York-based research group said today. Another report showed consumer sentiment dropped more than forecast in June.

U.S. Stocks Rise, Averting Longest S&P 500 Index Losing Streak Since 2001 (Source: Bloomberg)
U.S. stocks rose for the first time in seven weeks, preventing the longest losing streaks for the Standard & Poor’s 500 Index and Dow Jones Industrial Average since 2001, as concern about the American economy ebbed even as the Greek debt crisis deepened. Home Depot Inc. (HD), McDonald’s Corp. and Microsoft Corp. advanced more than 2.4 percent this week to lead gains in the Dow after reports on jobless claims, retail sales and housing beat economist estimates. VF Corp. (VFC) jumped 12 percent after agreeing to buy Timberland Co. (TBL), while J.C. Penney Co. surged 15 percent after hiring an Apple Inc. vice president as its chief executive officer. Owens-Illinois Inc. (OI) fell 13 percent, the most in the S&P 500, after cutting its profit-margin forecast.

Home Sales Probably Dropped to Year’s Low: U.S. Economy Preview (Source: Bloomberg)
Home sales probably dropped in May to the lowest level of the year, while orders placed with factories climbed, showing housing remains a soft spot as other parts of the U.S. economy recover, economists said before reports this week. Purchases of new and existing houses decreased 4.8 percent to a 5.11 million annual rate last month, the weakest since November, according to the median forecast of economists surveyed by Bloomberg News. Another report may show bookings for goods made to last at least three years increased after falling in April by the most in six months.

China Home Prices Cool on Government Curbs (Source: Bloomberg)
China’s effort to cool home prices is damping the market for existing homes, with prices in May falling from the previous month in 23 of 70 cities measured.

Japanese Stocks Advance on Optimism Greece Will Meet EU Budget Cut Demands (Source: Bloomberg)
Japanese stocks rose for the first time in three days on expectation Greece will meet demands by European governments to cut its debt and after a report signaled U.S. economic growth may pick up by the end of this year.

Banks Holding Record $1.45 Trillion to Buy Treasuries as Savings Top Loans (Source: Bloomberg)
Japan’s biggest bond investors see increasing parallels between the nation’s government debt market and Treasuries, indicating that historically low yields in the U.S. have room to fall.

Europe Fails to Agree on Greek Aid Payout (Source: Bloomberg)
European governments failed to agree on releasing a loan payout to spare Greece from default, ramping up pressure on Prime Minister George Papandreou to first deliver budget cuts in the face of domestic opposition.

EU Finance Ministers May Approve Only Half of Next Greek Aid Installment (Source: Bloomberg)
Belgian Finance Minister Didier Reynders raised the prospect of finance ministers reaching a deal on payment of only half of the 12 billion-euro ($17.2 billion) next installment to Greece. “I’m only saying that financing has to be released by the International Monetary Fund and the European Union,” Reynders told reporters in Luxembourg today. “That’s the short-term. We will in any case try to release the necessary funds for the short-term, which should happen with a financing of a bit less than 6 billion euros in the beginning of July.’’

Europe May Withhold Half of Greek Payment (Source: Bloomberg)
European governments weighed withholding half of Greece’s next 12 billion-euro ($17.2 billion) aid payment, seeking to keep the country solvent while maintaining pressure on the government to slash the debt that pitched the euro area into crisis. Euro-area finance ministers may authorize only a 6 billion- euro loan to tide Greece through bond redemptions in July, while further aid hinges on Greek budget cuts, Belgian Finance Minister Didier Reynders said.

Greek Default Would Spell ‘Havoc’ for Banks (Source: Bloomberg)
A year after European officials bailed out Greece, investors say the region’s banks haven’t raised sufficient capital or cut loans enough to withstand the contagion that may follow a default. While European lenders reduced their risk tied to Greece by 30 percent to $136.3 billion last year by not renewing loans, writing down the value of debt and shifting it off their books, they still have almost $2 trillion linked to Portugal, Ireland, Spain and Italy, figures from the Bank for International Settlements show, leaving them vulnerable if the crisis spreads.

20110620 1006 Global Commodities Related News.

Corn (Source: CME)
US corn futures end slightly lower, capping a week straight of declines and dropping 11% from last Friday's record high near $8/bushel. "The bears won this week," says Dave Marshall, an independent commodities broker in Illinois. Prices traded higher and lower during the session, eventually succumbing to continued selling pressure. CBOT July corn slipped 1 1/4c to $7.00 1/4 a bushel.

Wheat (Source: CME)
US wheat futures finish mixed as the markets stabilize after dropping sharply earlier in the week. Traders were assessing the ongoing harvest, which has pressured prices by bringing in fresh supplies. The harvest is revealing "outstanding protein levels" in the southern Plains, making the crop desirable to grain users, according to US Wheat Associates, a trade group. Harvest is quickly winding down in Oklahoma but expected to slow down in as it moves north into Nebraska. CBOT July wheat slips 1c to $6.72 1/4 a bushel; KCBT July rises 6 1/2c to $8.04 1/2; MGE May stumbles 3c to $8.97 1/4.

Rice (Source: CME)
US rice futures finish at a 1-month low as expectations for favorable weather pressure prices. Crops should benefit from rains in dry areas of the Mississippi Delta next week, analysts note. Conditions have already improved in producing state like Arkansas and Louisiana, according to federal data issued this week. The USDA will update its crop ratings Monday. CBOT July rice sheds 4c to $13.96 1/2 per hundredweight.

Brazil's Winter Corn Crop May Miss Output Forecast - Analyst (Source: CME)
Dry weather and late-season planting could cause Brazil's winter corn harvest to miss official output estimates, though the shortfall should be partially offset by a larger crop area, according to Rabobank. Conab, as the crop-forecasting agency of the Agricultural Ministry is known, estimated that Brazil's 2010-11 corn crop will reach 56.7 million metric tons, up 1.3% from a year earlier. The second crop, which was planted in March and will be harvested in the coming weeks, is expected to account for 21.7 million tons of corn, according to Conab's latest forecasts. Renato Rasmussen, Rabobank's grain and oilseed analyst in Brazil, said in an interview that scarce rainfall during much of April and May will likely hurt crop yields. He expects the winter harvest to yield around 17 million tons of corn, bringing the total for the 2010-11 crop year to 52 million tons. Corn growers took a gamble by planting corn late in the season, after a delayed soy harvest, when dry weather typically prevails, Rasmussen said.
"Although it was very risky to plant in such a late harvest, they decided to do it anyway because of the prices," he said. Until last week's rains in southern Brazil, the situation was looking even worse. Central-western Mato Grosso state, which didn't get a break from a drought, could still suffer a 30% to 35% drop in overall corn output, Rasmussen said. Likely helping to balance out some of the lost productivity is an 8.8% year-over-year increase in the planted area of corn, which Conab estimates at 5.71 million hectares for the second harvest.

Crusting Hurts Ontario's Corn Emergence -Report (Source: CME)
The development of corn planted in some of Ontario's heavier soils was being hampered by crusting soils, according to the Ontario Ministry of Agriculture, Food and Rural Affairs' field crop update for the week ended June 15. The crusting has resulted in emergence problems in those areas, the report said. Soybean development in the province ranges from the vegetative emergence stage to the trifoliate leaf stage, the report said. In dry areas plant emergence was seen as poor on fields that were not planted into moisture. Flea beetle pressure was described as high in select areas of the canola growing regions. The report also indicated that Swede Midge damage was also evident in certain canola fields. Most of the winter wheat crop in southern Ontario was now at or past the 75% heading stage and well into full flowering stage, the report said. The advanced fields were now past the window for fusarium control products.
There is a significant amount of white or bleached wheat heads reported in fields in areas of south-western Ontario. Advanced spring cereal crops were at the flag leaf stage of development and about 7 to 10 days before heading, the report said. First cut forage maturity was advanced.

China Adds Argentina's Farmlands To Its Commodities Shopping List (Source: CME)
Chinese investment is flooding into Argentina as the Asian giant expands its global commodity hunt from the raw materials used in industry to the foodstuffs needed to feed its 1.3 billion citizens. China's investment in Latin America hit $15.6 billion during the 12-month period through the end of May, nearly three times greater than the year-ago period, consulting firm Deloitte said in a report. Of that amount, Brazil received about 60% and Argentina close to 40%. During the last three years, more than 70% of China's investment in the region went to energy and minerals, but farming is attracting more attention as the country seeks to fill its bowls from foreign fields. China already buys the bulk of Argentina's soybean exports, its top crop and largest source of export revenue. Soybeans are mainly used as livestock feed in China, where meat consumption is rising along with personal incomes. At the same time, urbanization is shrinking the amount of arable land available in China.
Last week, China's largest farming company, Heilongjiang Beidahuang Nongken Group, inked a joint venture with Argentina's Cresud SA to buy land and farm soybeans. Cresud is one of Argentina's top agriculture firms with control over more than 1 million hectares (2.47 million acres) of farmland that produce grain, cattle and milk. Heilongjiang Beidahuang's chairman, Sui Fengfu, told Dow Jones Newswires in March that the company plans to buy 200,000 hectares of overseas farmland this year, and that Latin America is a key target. The company is already farming 2 million hectares of land outside China. Heilongjiang Beidahuang is also spending $1.5 billion to lease and develop farms on 300,000 hectares in Argentina's Rio Negro Province. Over a five- to 10-year period, the company plans to grow wheat, corn, soybeans, fruits, vegetables and wine grapes for export to China. The Cresud and Rio Negro deals appear aimed at avoiding a backlash against foreign ownership of farmland in Argentina.
President Cristina Fernandez has introduced legislation limiting land purchases by foreign individuals and companies to 1,000 hectares in rural areas. Heilongjiang Beidahuang's incursion in agriculture comes hot on the heels of heavy Chinese investment in Argentina's oil sector. In February, Occidental Petroleum Corp. sold its local assets to China Petroleum & Chemical Corp. for $2.5 billion. Last year, China's Cnooc Ltd., in partnership with Argentina's Bridas Corp., agreed to buy a 60% stake in Pan American Energy from BP PLC for $7.1 billion. China's hunger for raw materials has also led it into mining, with MCC Minera Sierra Grande SA, a unit of state-run China Metallurgical Group, buying the Sierra Grande iron mine in Rio Negro Province in 2006. The mine, which had been shuttered since 1991, made its first shipment of iron-ore concentrate to China in February.
Deloitte predicts that Chinese investment will continue pouring into Latin America, but expects a diversification in the future into other industries such as manufacturing, infrastructure and finance. Though its growing exponentially, China's investment still makes up a relatively small share of total foreign direct investment flows to the region. Foreign direct investment in Latin America grew 40% on the year to $113 billion in 2010, and is expected to rise 15% to 20% this year, according to the U.N.'s Economic Commission for Latin America and the Caribbean.

OECD Sees A Decade Of High, Volatile Food Prices (Source: CME)
Food prices will be up to 30% higher on average over the next decade as slowing grains production fails to keep pace with rising demand, the Organization for Economic Cooperation and Development said, but it said financial speculation has no long-term effect on food prices. Price volatility, which has plagued agricultural markets in recent years, is also set to become commonplace as lower output gradually erodes world stocks, the OECD said in a joint report with the United Nations' Food and Agriculture Organization. And with climate change expected to make yields vary far more wildly from year to year and world stocks expected to fall, the report said that feeding the world's almost 1 billion hungry people will become harder. "A slow-growing supply set against expected high demand underlines the projection of high and more volatile agricultural commodity prices," said the report.
Ministers from the Group of 20 industrialized nations are expected to announce next week plans to create a global database on food production and stocks, to mirror existing schemes in oil markets. The OECD and the FAO backed the need for improving transparency through better forecasting, but stopped short of arguing that financial investors were responsible for driving up food prices in the long term. "High levels of speculative activity in futures markets may amplify price movements in the short term although there is no conclusive evidence of longer term systemic effects on volatility," they said. Instead, they argue that the rise in prices is likely to be driven by an increasing imbalance in fundamentals. A forecast 30% increase in the price of poultry and 20% increase in pigmeat, for example, is down to growing consumption by developing world's rapidly-expanding middle class, they said.
Rising demand from biofuels and the increased use of grains for feed are also expected to push up cereals prices by a fifth as production growth slows to 1.7% a year due to stagnating yields in the developed world, down from 2.6% over the previous decade. Wheat yields are predicted to increase only 0.8% a year, leaving production and consumption on an even keel at 746 million metric tons. Production of rice, the staple grain consumed in Asia, is expected to increase to 528 million tons by 2020, a rate of only 1.3% a year. "Weather-related crop yield variations are expected to become an even more critical driver of price volatility in the future," the report said. Yet the bodies shied away from predicting any shortfall in output of major grains, forecasting that global coarse grain production will rise 18% by 2020 to 1.321 billion tons by 2020, the same pace as consumption.
They said that any slowdown in output in the developed world is likely to be made up for by rising production in emerging countries, particularly in Latin America and Eastern Europe. "The projections confirm the continuation of the gradual shift in agricultural market share from developed to developing countries," they said. Still, they noted that external influences, such as oil and the movement of currencies, will have a growing influence on food prices and are likely to drive volatility in the markets in the years ahead. By 2020 biofuels are projected to absorb 13% of global production of coarse grains, primarily corn, 15% of vegetable oil and some 30% of sugar.

Funds Reduce Long Positions in Commodities in Bet Global Growth to Decline (Source: Bloomberg)
Funds reduced bullish bets on commodity prices for the first time in four weeks as Greek’s debt crisis spurred speculation that global growth will decline, curbing demand for raw materials.

World Faces Century of Hunger Without Farm Deal, France’s Le Maire Says (Source: Bloomberg)
The Group of 20 countries must reach an agreement at a meeting of farm ministers in Paris next week to avoid the 21st century from becoming “the century of hunger,” French Agriculture Minister Bruno Le Maire said. France, as president of the G-20 this year, is proposing a shared database on food stocks and harvests, a forum on export restrictions, emergency stocks in food-deficient countries and regulation to reduce commodity-price swings, Le Maire said.

Corn Stocks Plunging to 1974 Low as China Adds Brazil-Sized Crop to Demand (Source: Bloomberg)
Even a fifth consecutive year of record global corn harvests will fail to meet demand for food, fuel and livestock feed, reducing world stockpiles to the lowest in two generations. Consumption will rise 3 percent in the next marketing year, a 16th consecutive annual gain that saw demand jump 66 percent, according to U.S. Department of Agriculture estimates. Inventory will drop to 47 days of use, the fewest since 1974, the data show. Waterlogged fields in the U.S., the largest exporter, will curb yields, Goldman Sachs Group Inc. says. Corn may jump 36 percent to a record $9 a bushel if conditions worsen, Morgan Stanley says.

Oil Declines for Second Day on Concerns Over European Debt, Global Economy (Source: Bloomberg)
Oil declined a second day in New York on speculation a slowing global economy and Greece’s debt crisis will lead to lower fuel demand. Futures fell as much as 0.4 percent today after the biggest weekly decline in six weeks. European governments weighed withholding half of Greece’s next 12 billion-euro ($17.2 billion) aid payment to maintain pressure on the government to slash its debt. Japan’s exports fell 10.3 percent in May from a year earlier. Economists surveyed by Bloomberg News forecast an 8.4 percent drop. A report tomorrow may show U.S. home sales last month slid to the lowest this year.

Crude Oil Falls to Near a Four-Month Low on European Debt Crisis, Economy (Source: Bloomberg)
Crude oil dropped to the lowest price in four months in New York on doubts European efforts to resolve the Greek debt crisis will succeed, and on concern of reduced economic growth and fuel demand. Futures fell 2 percent as Greek Prime Minister George Papandreou attempted to get the country’s parliament to pass austerity measures needed for a bailout. The International Monetary Fund cut its forecast for U.S. growth in 2011. Oil tumbled 6.3 percent this week as U.S. manufacturers turned pessimistic and fuel consumption dropped.

Gold May Drop as Growth Risk Hurts Commodities (Source: Bloomberg)
Gold is poised for a second weekly decline as growing evidence of an economic slowdown and the dollar’s strength curb demand for commodities. Immediate-delivery gold dropped as much as 0.3 percent to $1,525.73 an ounce before trading at $1,526 at 2:35 p.m. in Singapore. The metal lost 0.3 percent this week after a 0.7 percent drop the previous week. The August-delivery contract decreased 0.2 percent to $1,527.60. Cash silver lost 2.4 percent this week and was set for a third weekly decline.

20110620 1004 Soy Oil Related News.

Soy Oil chart reading : downside biased with possible pullback correction.

ITS CPO export up 22% to 969,804 tonnes for the period of 1~20 Jun 2011.
SGS CPO export up 18.8% to 973,211 tonnes for the period of 1~20 Jun 2011.

Soybeans (Source: CME)
US soybean futures stumble, with improved crop outlooks, falling crude oil futures and sagging demand spuring salling. Ongoing concerns about the global economy kept traders in a cautious mood, with the absence of fresh supportive news providing little incentive for buyers to step into the market, analysts say. Traders buying corn and selling soybeans on spreads as well as forecasts calling for rains to reach drought stricken areas of the south provided further incentives for buyers to head to the sidelines, analysts add. CBOT July soy down 17 1/2c at $13.33/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures end lower, consistent with the lower theme in soybeans. Soyoil futures dropped to a one month low, falling in unison with falling crude oil and soybean futures, analysts said. Soymeal futures stumble, moving in step with the lower theme filtering through soy complex futures. CBOT July soyoil settled down 0.7% at 55.92 cents/pound, and July soymeal ended down 1.3% at $349.00/short ton.