Monday, October 10, 2011

20111010 1810 FCPO EOD Daily Chart Study.

FCPO closed : 2793, changed : +21 points, volume : higher.
Bollinger band reading : pullback correction downside biased.
MACD Histrogram : recovering, seller taking profit.
Support : 2770, 2750, 2720, 2700 level.
Resistance : 2800, 2850, 2900, 2920 level.
Comment :
FCPO closed recorded small gain with improved volume changed hand while last Friday soy oil ended little higher and currently surging higher recording huge gains while crude oil also climbing higher.
Official MPOB report released showing negative impact data by registering lower exports with higher stocks and output level however both cargo surveyor reported double digit percentage surge in exports for the period of 1~10 lifted FCPO price to trade higher.
Daily chart formed a doji bar candle closed farer from middle Bollinger band after market opened and tested higher ground followed by after lunch downward slide before recovered upward partly to closed near opening price.
Chart study remained suggesting a pullback correction downside biased market 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.

20111010 1740 FKLI EOD Daily Chart Study.

FKLI closed : 1403.5, changed : +17.5 points, volume : lower.
Bollinger band reading : side way range bound downside biased.
MACD Histrogram : rising, seller closing position while buyer testing market.
Support : 1400, 1395, 1385, 1375 level.
Resistance : 1420, 1425, 1440, 1445 level.
Comment :
FKLI closed recorded gains with slower volume participation doing 6 points premium compare to cash market that ended little lower. Last Friday U.S. market closed little lower and today's Asia markets traded mostly higher while European markets currently trading in positive tones.
Germany and France move to support European banks with adequate capital and U.S. better than estimates payroll data lifted most regional markets higher.
Daily chart formed an up bar candle with lower shadow closed above middle Bollinger band level after market opened and traded higher for the first 30 minutes and slide lower tested middle Bollinger band level before last hour upward surge to closed near the high of the day.
Chart reading still suggesting a side way range bound downside biased market 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 resistance or strength with moderate cut loss and profit target.

20111010 1712 Regional Markets EOD Daily Chart Study.

 DJIA chart reading : side way range bound.
 Hang Seng chart reading :  pullback correction downside biased.
KLCI chart reading : pullback correction downside biased.

20111010 1648 Global Market & Commodities Related News.

Euro up on debt deal hopes, China drags on stocks
SINGAPORE, Oct 10 (Reuters) - The euro rose on Monday after the leaders of France and Germany pledged to unveil a plan to solve the euro zone's sovereign debt crisis by the end of the month, but Asian shares struggled to make gains as Hong Kong and China stocks dragged.  
"They are looking at sorting out the European debt issue sooner rather than later," said Phillip Weinberg, dealer at Melbourne-based investment management firm Karara Capital.

European Stocks Rise; U.S. Futures Advance (Bloomberg)
European stocks were little changed, halting a two-week rally, as banks fell, following a report that BNP Paribas SA and Societe Generale (GLE) SA plan to raise more capital. U.S. index futures and Asian shares rose. BNP Paribas and Societe Generale both lost more than 2 percent after they denied a newspaper report that they may seek to raise billions of euros. Dexia SA (DEXB) may be active when trading in the shares resumes after Belgium stepped in to shore up the company. Premier Oil Plc (PMO) rose 3.2 percent as analysts increased their recommendations on the shares. The benchmark Stoxx Europe 600 Index rose 0.2 percent to 232.39 at 8:55 a.m. in London as the leaders of Germany and France gave themselves three weeks to create a plan to recapitalize banks. Futures on the Standard & Poor’s 500 Index climbed 1 percent, while the MSCI Asia Pacific Index added 0.4 percent.

FOREX - Euro rises on EU pledge, markets cautious
SINGAPORE/SYDNEY, Oct 10 (Reuters) - The euro edged higher on Monday after leaders of Germany and France promised a new comprehensive plan to recapitalise euro zone banks by the end of the month, though markets remain wary as they have been disappointed many times before.
The meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy offered no details, but drew a pledge to do what is necessary to shore up banks, settle the Greek crisis and help growth in Europe, giving a gentle boost to risk sentiment.

Global growth a worry, China to the rescue
LONDON, Oct 7 (Reuters) - Demand for base metals has softened only slightly, propped up by tight supplies and strong Chinese appetite, even while prices have dropped as investors have retreated from markets in fear of a global economic downturn and Europe's debt crisis.
This is the message that echoed through London Metal Exchange Week, the main fixture in the global metals industry calendar, which drew thousands of professionals this week.

CFTC takes wait-and-see approach on Volcker rule
WASHINGTON, Oct 7 (Reuters) - The U.S. futures regulator may break with other agencies on a much-anticipated plan to ban most proprietary trading by banks, and could opt to put forth a slightly different version of the Volcker rule.
An independent approach from the Commodity Futures Trading Commission could raise questions about coordation and embolden banks to challenge the Volcker rule, although the agency -- which polices futures and derivatives markets -- is not believed to play a central role in implementing it.

Slight drop seen in US corn crop; more stocks
CHICAGO, Oct 7 (Reuters) - The size of the U.S. corn crop should be down less than 1 percent from last month as a drop in harvested acreage will largely be countered by better yields, analysts polled by Reuters said ahead of a government report.
The U.S. Department of Agriculture's supply-demand report on Oct. 12 is likely to peg this year's U.S. corn crop at 12.471 billion bushels on a yield of 148.7 bushels per acre (bpa), according a Reuters survey of 27 analysts.

India could burn fingers with aid to domestic palm refiners
KUALA LUMPUR/NEW DELHI, Oct 7 (Reuters) - India's plan to hike a domestic levy on refined palm oil, designed to protect its refiners from cheaper exports by top palm oil producer Indonesia, will backfire in the absence of  rival suppliers to meet the appetite of the south Asian nation.
The world's top edible oil buyer could end up spending more on Indonesian crude palm oil , which has risen as high as $84 over benchmark Malaysian futures  after Indonesia raised taxes on the crude in the middle of September.

Kansas wheat acres seen rising despite drought
CHICAGO, Oct 7 (Reuters) - Wheat planting in Kansas this year may rise 1 to 3 percent from a year ago despite more than half of the top U.S. winter wheat state being under a severe drought, the head of a Kansas wheat group said on Friday.
Disappointing corn yields this year, especially in bone-dry southern areas of the state, may have some producers resisting the urge to set aside acres for corn planting next spring and they may instead revert back to wheat, Justin Gilpin, chief executive of the Kansas Wheat Commission, told the Reuters Global Ags Forum.

U.S. soy stocks bolstered by weak exports
CHICAGO, Oct 7 (Reuters) - U.S. soybean stocks are expected to rise 11 percent from a month ago due to high prices denting demand, but a government report next week is likely to keep its estimate of yield unchanged, analysts polled by Reuters said.
Global soybeans stocks are also expected to rise, but by less than 1 percent, the analysts said, ahead of the U.S. Department of Agriculture's supply-demand report on Wednesday.
US soy at 1-week top on Euro zone debt deal hopes
SINGAPORE, Oct 10 (Reuters) - U.S. soybean futures rose to a one-week top on Monday, while wheat recovered after five straight weeks of losses on optimism as Europe's two biggest economies, France and Germany, promised a package by month-end to solve the euro zone's debt crisis.
"There is improved risk appetite with efforts being made in Europe to solve the debt crisis and also there was good news from the U.S.," said Ker Chung Yang, a commodities analyst at Phillip Futures in Singapore. "The harvest of corn and soybeans is progressing well which may add some pressure."
Kazakh 2011 grain crop seen at 22-23 mln T - AgMin
ASTANA, Oct 10 (Reuters) - Kazakhstan expects a post-Soviet record grain crop of 22-23 million tonnes by clean weight this year, Agriculture Minister Asylzhan Mamytbekov said on Monday.
"We are forecasting a grain harvest of 22 million to 23 million tonnes by clean weight," Mamytbekov told a government meeting.

Rain delays Vietnam's coffee maturing, harvesting
HANOI, Oct 10 (Reuters) - Recent rains in Vietnam's Central Highlands coffee belt has delayed cherries from maturing and discouraged farmers' drying, dashing market expectation of the early arrival of fresh beans, traders said on Monday.
Traders fear the rains could overstay late this month, disrupting harvesting in the world's second-largest coffee producing nation after Brazil, given forecasts of late ending of the rainy season and more storms.

China projected to import 14.2 mln T soy in 4Q -CNGOIC
BEIJING, Oct 10 (Reuters) - China will likely import a total of 14.2 million tonnes of soybeans in the last quarter, the China National Grain and Oils Information Center said in its daily report on Monday.
If the projection is confirmed, that would be a 3.0 percent fall from 14.64 million tonnes it imported in the same period last year.

Brazil Sept green coffee exports down 15 pct on yr
BRASILIA, Oct 7 (Reuters) - Brazil exported 2.56 million 60-kg bags of green coffee in September, down from the 2.99 million bags shipped in the same month a year ago, the Council of Green Coffee Exporters, Cecafe, said on Friday.
Brazil's 2011 smaller off-year harvest is now finished and the world's top coffee producer will be running down stocks from that crop until next year's expected larger on-year harvest starts in May.

India wheat exports seen at 1.2 mln tones- attache
Oct 7 (Reuters) - Following are selected highlights from areport issued by a U.S. Department of Agriculture attach&#233 in India:&#8221 On September 9, 2011, the Government of India removedits export bans on wheat and no basmati rice.
Consequently, the MY 2011/12 wheat export forecast has been raised to 1.2 million tonnes and the MY 2011/12 rice export forecast has been raised to 4.5 million tones.-

Canada says law to end grain monopoly coming soon
WINNIPEG, Manitoba - Oct 7 (Reuters) - Canada's Conservative government will pass legislation "very soon" to end the Canadian Wheat Board's monopoly on marketing western wheat and barley for milling or export, Prime Minister Stephen Harper said on Friday, strongly warning the board to get out of the way.
Harper, in Regina, Saskatchewan for the announcement for construction of Western Canada's first major durum-processing plant in years, said his government will introduce legislation shortly after next week's House of Commons break and pass it soon after. The monopoly would end as of Aug. 1, 2012.

Brent up near $106 on euro debt steps, U.S. data
SINGAPORE, Oct 10 (Reuters) - Brent rose on Monday to near $106, fuelled by optimism that demand in the world's largest consumer would hold after U.S. data allayed fears of a renewed recession while the euro zone edged closer to a resolution of its debt crisis.
"There is a positive feel to problems being solved at the moment," said Jonathan Barratt, managing director at Commodity Broking Services in Sydney.

Saudi to supply full Nov crude to 2 Asia buyers - sources
SINGAPORE, Oct 10 (Reuters) - Saudi Arabia, the world's top crude exporter, will supply full contracted volumes of crude oil in November to at least two Asian term buyers, steady with October, industry sources familiar with the matter said on Monday.
Saudi Arabia made no changes to the operational tolerance in the supply allocation, the sources added, meaning buyers have the option of asking for cargoes to be loaded with up to 10 percent more or less crude than contracted.

Shanghai copper up after week-long holiday
SHANGHAI, Oct 10 (Reuters) - Shanghai copper slipped 0.8 percent by midday on Monday, weighed down by cautious sentiment as the market reopened after a week-long holiday.
"I expect Shanghai copper's upside to be limited today. The upward momentum from London's previous gains is stifled by a lack of open positions in Shanghai," CIFCO Futures analyst Zhou Jie said.

Indonesia's Sept tin exports fall 24 pct y/y
JAKARTA, Oct 10 (Reuters) - Indonesia's refined tin exports in September slipped 24 percent compared to the same month a year ago, a trade ministry official said on Monday.   Indonesia, the world's top refined tin exporter, shipped 5,233.06 tonnes in September, compared to 6,904.37 tonnes in September last year, trade ministry data showed.

Union pessimistic as Freeport Peru strike drags on
LIMA, Oct 7 (Reuters) - Union leaders said they were pessimistic on Friday after failing to reach an accord with officials from Freeport-McMoRan to end an indefinite strike at the Cerro Verde mine.
Workers at the mine that produces 2 percent of the world's copper put down their tools on Sept. 29 demanding higher wages.

Iron ore, coal to move to shorter index-based pricing-ENRC
LONDON, Oct 7 (Reuters) - Pricing for steel ingredients iron ore and coking coal is likely to move to shorter-term index-based mechanisms, Jim Cochrane, chief commercial officer of Kazakh miner ENRC , said.
The top three iron ore miners Vale , Rio Tinto   and BHP Billiton   dumped a decades-old annual scheme last year in favour of quarterly pricing.

Zambia strikes spread at China-owned copper mines
LUSAKA, Oct 7 (Reuters) - Strikes spread in Zambia's copper industry on Friday, with more than 500 workers at a Chinese plant demanding higher pay, just two weeks after a new president took office on the promise of improving mining conditions.
"The strike today spread to Sino Metals where workers want higher salaries," National Union of Mine and Allied Workers general secretary Goodwell Kaluba told Reuters on Friday.

China Nickel to buy $266 mln stake in Indonesian mining firm
HONG KONG, Oct 10 (Reuters) - China Nickel Resources Holdings Co Ltd  said on Sunday it would buy an 80 percent equity stake in Indonesian iron-nickel ore firm PT Yiwan Mining for HK$2.067 billion ($266 million) in a bid to secure supply of nickel-iron ores and mineral resources.
The Chinese integrated mineral resources, nickel and special steel maker said in a statement that HK$1.907 billion of the acquisition costs would be settled by the issue of convertible notes.

Indonesia's Sept tin exports fall 24 pct y/y
JAKARTA, Oct 10 (Reuters) - Indonesia's refined tin exports in September slipped 24 percent compared to the same month a year ago, a trade ministry official said on Monday.  
Indonesia, the world's top refined tin exporter, shipped 5,233.06 tonnes in September, compared to 6,904.37 tonnes in September last year, trade ministry data showed.

Australia's Extract shares jump on Chinese bid speculation
MELBOURNE, Oct 10 (Reuters) - Shares in Extract Resources  surged over 10 percent on Monday on expectations it may get a takeover offer from a Chinese company that is lining up a $1 billion bid for Extract's biggest shareholder, Kalahari Minerals .
Extract, which is developing the Husab uranium project in Namibia, potentially the second-largest uranium mine in the world, halted trading in its shares pending an announcement by Oct 12.

Congo copper output up, power a worry
LUBUMBASHI, Democratic Republic of Congo, Oct 7 (Reuters) - Democratic Republic of Congo's Katanga province is expected to produce 500,000 tonnes of copper this year, up 13 percent from 2010 despite power cuts that may threaten future investment and output in the mining sector, a government official said.  
Katanga has some of the largest copper and cobalt deposits in the world, and it has enjoyed a post-war flood in investment, but a lack of infrastructure following decades of dictatorship and mismanagement continues to dog mining companies.

METALS - Euro rises on EU pledge, markets cautious
SINGAPORE/SYDNEY, Oct 10 (Reuters) - The euro edged higher on Monday after leaders of Germany and France promised a new comprehensive plan to recapitalise euro zone banks by the end of the month, though markets remain wary as they have been disappointed many times before.
The meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy offered no details, but drew a pledge to do what is necessary to shore up banks, settle the Greek crisis and help growth in Europe, giving a gentle boost to risk sentiment.

PRECIOUS - Gold up 1 pct as hopes rise on Europe debt
SINGAPORE, Oct 10 (Reuters) - Gold prices rose 1 percent on Monday, reversing a decline in the previous session, after the leaders of France and Germany promised to unveil new steps by the end of the month to resolve the euro zone's debt crisis, spurring commodities and equities.
The announcement by leaders of the bloc's top two economies followed the downgrade of credit ratings of Italy and Spain last week, which depressed the price of bullion.

Gold up 1 pct as hopes rise on Europe debt
SINGAPORE, Oct 10 (Reuters) - Gold prices rose 1 percent on Monday, reversing a decline in the previous session, after the leaders of France and Germany promised to unveil new steps by the end of the month to resolve the euro zone's debt crisis, spurring commodities and equities.
"For now, gold seems to follow the movement in the commodities market," said Ong Yi Ling, an analyst at Phillip Futures, adding that the safe-haven appeal of gold had faded after unprecedented huge volatility in recent months.

20111010 1233 Malaysia Corporate Related News.

Budget 2012: Reducing inflation, enhancing well-being of rakyat
The RM230.8bn Federal Government Budget 2012 proposals unveiled last Friday, will focus on seven core areas including reducing the impact of inflation while focusing on the rakyat, especially the lower-income group and those in the rural areas. The Economic Report 2011/2012 said the theme of the Budget 2012 would be “Transformational Budget: Welfare for the rakyat, well-being of the nation”. The Budget would focus on the concerns of the rakyat, including the effects of a weak external sector on the economy though the implementation of several programmes including the Economic Transformation Programme, Government Transformation Programme and 10th Malaysia Plan. The seven key areas are: i) Reducing the impact of inflation; ii) Enhancing the well-being of the rakyat; iii) Accelerating rural transformation; iv) Reinvigorating investment activities; v) Innovating Malaysia; vi) Developing human capital; and vii) Improving public service delivery. (Financial Daily)

Blue-chip firm in the making
Felda Global Group has been given the green light by the Government to list its commercial unit, Felda Global Ventures Holdings SB, on Bursa Malaysia by the middle of next year. Felda Global Group comprises Felda Global Ventures and Felda Holdings, which are the commercial entities of Federal Land and Development Authority (Felda). Prime Minister Datuk Seri Najib Tun Razak said in his Budget 2012 speech that the listing was to raise funds to enable the company to be a global conglomerate. The listing would also create another blue-chip plantation company, besides attracting international investors to the local bourse, he said. (StarBizWeek)

Proton sees fillip to green car ownership
The Government's efforts in driving the "green" initiative as outlined in the 2012 Budget, will encourage market acceptance and further motivate Malaysians to own green vehicles, says Proton Holdings. It‟s Group Managing Director, Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir said: "This is a positive point for Proton as we are moving towards this direction with the development of green vehicles, namely the Saga EV and Exora REEV."Both cars are now being put on road-trial via Proton's Fleeting Testing Vehicle (FTV) Programme with the Government, he said in a statement today. However, he hoped, that this will be subsequently followed with more initiatives by the government to further encourage the take-up of such vehicles, including measures to reduce cost of ownership and localisation of related component parts. (BT)

Pasdec buys into S. African firm
Pasdec Holdings subsidiary Pasdec Automotive Technologies (Pty) Ltd is buying a 30.9% stake in CRH Africa Automotive (Pty) Ltd for ZAR48m (RM18.26m) cash. In a filing with Bursa Malaysia, Pasdec Holdings said CRH manufactured seat components and catalytic converters for the automotive industry, and had two operating plants in South Africa. The major shareholder of CRH is automotive component supplier CR Hammerstein of Germany with a 69.1% stake. (StarBiz)

Firefly jets to be absorbed into MAS fleet?
It is understood its turboprop operations, which is what the airline started with, out of Subang, will continue until further notice. Firefly has a fleet of eight jet aircraft, six Boeing 737-800s and two Boeing 737-400s. The B737-800s were based in Kuala Lumpur and Kota Kinabalu while the B737-400s were in Johor Baru. It is understood that the jets will then be absorbed into Malaysia Airlines' fleet. Malaysia Airlines and Firefly have been conspicuously silent since the announcement of its plans to re-brand Firefly into a regional premium full-service carrier. This has not stopped the low-cost carrier, however, from winding down its jet operations, in some cases axing routes without prior notice. (BT)

Malaysia-led group set to bag Gujarat finance city project
A Malaysian-led consortium is likely to sign a pact with the Gujarat government to develop a next generation city, modern enough to compete with Shanghai or Tokyo as a global financial hub. A consortium called Malaysian Developers for Gujarat Projects is expected to participate in the development of the Gujarat International Finance Tec-City (GIFT) on a public-private partnership model. "The Malaysian Developers for Gujarat Projects will build commercial, as well as social projects, including schools and hotels at GIFT," Dipesh Shah, GIFT's vice-president for corporate services and business development, was quoted as saying in "Times of India" on 7 Oct. (BT)

MAS: A380 delay? The delivery of Malaysia Airlines' first Airbus 380 jumbo jet may be delayed again, but this time it will not be due to manufacturing issues. It is understood that the new management of MAS is considering the reconfiguration of its seats to offer a product that will reflect its new premium status. (Source: Business Times)

Genting: Lawmakers get go-ahead to debate Bill on resort casinos. Genting Group seems to be a step closer to the casino licence in Miami after an appeals court said lawmakers could expand gaming companies without first seeking voters' approval. (Source: The Edge Financial Weekly)

Dijaya: Buys KL land for RM65m. Dijaya Corp Bhd has acquired a one-acre freehold land along Jalan Sultan Ismail, Kuala Lumpur, for RM65.3m. The land will be transformed into a mixed development consisting of serviced apartments and commercial lots with a GDV of RM650m. (Source: Bursa Malaysia)

Semiconductor: Global slowdown to impact local manufacturers. Malaysia-made automated semiconductor equipments are likely to be priced lower next year due to a projected drop in global spending on semiconductor equipment. Owing to excess inventory and poor demand as a result of the slowing macro economy, worldwide semiconductor capital equipment spending is expected decline by 19.2% from a projected USD43.5b (RM137.3b) in 2011 to USD35.2b (RM111.1b) next year. (Source: The Star)

20111010 1232 Local & Global Economic Related News.

Malaysia: Malaysia to boost wages, help poor in pre-election budget
Malaysian Prime Minister Najib Razak will give cash to low-income families, raise civil servants‟ pay and boost spending on railways to spur growth as the global economy cools and elections loom. Gross domestic product may expand 5% to 6% next year after growing as much as 5.5% in 2011, Najib, also finance minister, said in an annual budget speech last Friday. The government may spend about RM232.8bn (USD74bn) in 2012, he said, 1.4% more than this year‟s outlay. The budget deficit is forecast to narrow to 4.7% of GDP from 5.4%. (Bloomberg)

Canada: Unemployment rate falls as economy adds 60,900 jobs
Canada‟s economy added the most jobs in eight months in September, led by hiring at schools, bringing the country‟s jobless rate to its lowest since 2008 and adding to evidence the country is averting a new recession. Employment rose by 60,900 after a decline of 5,500 in August, Statistics Canada said in Ottawa. The unemployment rate fell to 7.1%, its lowest since December 2008. Bloomberg News surveys called for a job gain of 15,000 and unemployment to remain at 7.3%. (Bloomberg)

UK: Weale says Bank of England can increase asset purchases plan
Bank of England policy maker Martin Weale said the central bank has “a lot of scope” to increase asset purchases if it‟s deemed necessary to boost economic growth. The UK central bank last week raised the ceiling for its asset purchases, or so-called quantitative easing, to GBP275bn (USD428bn) from GBP200bn. Governor Mervyn King said the move, the first loosening of U.K. monetary policy since the depths of the recession in 2009, was a response to what may be the worst financial crisis ever. (Bloomberg)

EU: Merkel, Sarkozy pledge bank recapitalization in next crisis plan
Angela Merkel and Nicolas Sarkozy, racing to stamp out the euro debt crisis threatening to engulf the financial system, gave themselves three weeks to devise a plan to recapitalize banks, get Greece on the right track and fix Europe‟s economic governance. Under increasing pressure to defuse turmoil that has raged for 18 months and facing growing concern that Greece is headed to default, Merkel said European leaders will do “everything necessary” to ensure that banks have enough capital. Sarkozy said they would deliver a plan by the 3 Nov Group of 20 summit. (Bloomberg)

US: Payroll gain in US beats forecasts, easing recession concerns
American employers added more workers in September than forecast and earnings and hours also rose, allaying concern the economy is slipping into another recession. Payrolls increased by 103,000 after a 57,000 gain in August, the Labor Department said yesterday in Washington. The median forecast in a Bloomberg News survey of economists called for an increase of 60,000. The figures reflected the end of a strike at Verizon Communications Inc. that brought 45,000 people back to work. The jobless rate held at 9.1%. (Bloomberg)

U.S: Payrolls gain beats forecasts in September. Payrolls increased by 103,000 after a 57,000 gain in August compared to a survey that called for an increase of 60,000. The figures reflected the end of a strike at Verizon Communications Inc. that brought 45,000 people back to work. The jobless rate held at 9.1%. (Source: Bloomberg)

U.S: Consumer credit fell by USD 9.5b in August following a USD 11.9b increase the previous month, the Federal Reserve said in Washington. Non-revolving credit, which includes student loans and financing for automobile purchases, slumped by the most in three years. (Source: Bloomberg)

Germany: Industrial production fell in August after surging in the previous month. Output fell 1% MoM from July, when it jumped 3.9% MoM. In the year, production rose 7.7% YoY when adjusted for working days. (Source: Bloomberg)

U.K: Output prices rose more than forecast in September, led by petroleum products and electrical equipment. Prices charged at factory gates rose 0.3% MoM from August, the Office for National Statistics said in London. (Source: Bloomberg)

Pakistan: Reduces key rate to boost expansion. Pakistan's central bank cut its benchmark interest rate by a more-than-expected 1.5 ppts to spur investment after terrorism and floods undermined economic growth. The State Bank of Pakistan lowered the discount rate to 12% from 13.5%. (Source: Bloomberg)

Vietnam: Central bank increased its refinancing rate for the first time since May, as the nation tries to steady its currency and tame Asia's fastest inflation. The State Bank of Vietnam raised the refinancing rate to 15% from 14%, effective Oct. 10, it said in a statement on its website. The central bank weakened the dong's reference exchange rate for the third straight day, to VND20,653 per USD from VND20,648 per USD. (Source: Bloomberg)

20111010 1154 Global Market Related News.

GLOBAL MARKETS-U.S. stocks, euro slip after euro-zone downgrades
By Walter Brandimarte
NEW YORK, Oct 7 (Reuters) - U.S. stocks ended lower on Friday, but European and Asian equities markets mostly finished higher, after several days of gains supported by assurances that European banks would be recapitalized to help deal with a potential debt default by Greece.
"The employment data was viewed as being relatively good, but this issue in Europe keeps rearing its head. We just can't seem to escape Europe's debt crisis," said Thomas Villalta, portfolio manager for Jones Villalta Asset Management in Austin, Texas.

Most Asian Stocks Rise as Merkel Eases Concerns (Source: Bloomberg)
Most Asian stocks rose, led by exporters and mining companies, after the heads of Europe’s two biggest economies pledged to shield banks from a debt crisis, easing concern the region’s troubles will derail a global economic recovery. Rio Tinto Group, the world’s second-largest mining company by sales, gained 2.1 percent in Sydney after commodity prices climbed. Billabong International Ltd., a global surfwear maker, advanced 2.2 percent. Samsung Electronics, the world’s second- biggest maker of mobile phones, rose 2.7 percent in Seoul, while Hanjin Heavy Industries & Construction Co., which gets 62 percent of its revenue overseas, surged 14 percent.
The MSCI Asia Pacific Excluding Japan Index advanced 0.6 percent to 384.75 as of 10:12 a.m. in Tokyo. More than three stocks rose for each that fell after German Chancellor Angela Merkel said European leaders would do “everything necessary” to ensure banks have adequate capital. The gauge dropped 14 percent in September on speculation Europe’s sovereign-debt crisis and slowing U.S. economic growth may derail a global recovery.

U.S. Stocks Advance on European Debt Optimism, Economic Data (Source: Bloomberg)
U.S. stocks rose this week, driving the Standard & Poor’s 500 Index up from the threshold of a bear market, amid optimism European leaders will tame the region’s debt crisis and after American economic data improved. Equities fell yesterday after Fitch Ratings cut Italy and Spain’s debt ratings, overshadowing faster-than-estimated U.S. job growth. Raw-material producers in the S&P 500 surged 6.2 percent this week, the most among 10 groups, while energy stocks and companies reliant on discretionary consumer spending climbed more than 3.4 percent. Hewlett-Packard Co. (HPQ) and Cisco Systems Inc. (CSCO) jumped at least 7.4 percent, leading gains in the Dow Jones Industrial Average. The S&P 500 advanced 2.1 percent to 1,155.46, breaking a two-week losing streak. It surged 6 percent between Oct. 3 and Oct. 6, the biggest three-day rally since August. The Dow rose 189.74 points, or 1.7 percent, to 11,103.12 this week.

U.S. Stock Futures Rise on Merkel Bank Pledge (Source: Bloomberg)
U.S. stock futures gained, indicating the Standard & Poor’s 500 Index will extend last week’s rally, after German Chancellor Angela Merkel said European leaders will do “everything necessary” to ensure that banks have adequate capital. Merkel joined French President Nicolas Sarkozy to persuade investors they can stamp out the debt crisis roiling global markets. At a joint press conference in Berlin, Sarkozy set a Nov. 3 deadline for a response that addresses the immediate crisis in Greece and what he called the structural defects in the 17-nation euro area. No details were provided. S&P 500 futures expiring in December advanced 0.8 percent to 1,163.70 at 9:35 a.m. Tokyo time.

Retail Sales Likely Rose in September (Source: Bloomberg)
U.S. retail sales increased in September at the fastest pace in six months, providing a sign of optimism for some merchants heading into the holiday shopping season, economists said before a report this week. The projected 0.7 percent gain would follow no change in the previous month, according to the median of 69 forecasts in a Bloomberg News survey ahead of Commerce Department figures on Oct. 14. The trade gap widened in August, other data may show. Macy’s Inc. (M) and Kohl’s Corp. (KSS) are among retailers adding more workers than last year in anticipation demand will hold up even amid limited job growth and stock-market volatility that’s left Americans more pessimistic. President Barack Obama, lawmakers and the Federal Reserve face pressure to spur the employment gains needed to support household spending, which accounts for about 70 percent of the world’s largest economy.

Payroll Gain in U.S. Beats Forecasts, Easing Recession Concerns (Source: Bloomberg)
American employers added more workers in September than forecast and earnings and hours also rose, allaying concern the economy is slipping into another recession. Payrolls increased by 103,000 after a 57,000 gain in August, the Labor Department said yesterday in Washington. The median forecast in a Bloomberg News survey of economists called for an increase of 60,000. The figures reflected the end of a strike at Verizon Communications Inc. (VZ) that brought 45,000 people back to work. The jobless rate held at 9.1 percent. Treasuries fell as the report added to evidence the world’s largest economy is maintaining its expansion. The pace of job growth is still too slow to push down the unemployment rate as companies hold back on hiring amid a debt crisis in Europe, political gridlock in the U.S. and a plunge in stock prices.

Business Jet Sales May Increase in 2012 as Asia Blunts Slow Global Economy (Source: Bloomberg)
Business-jet sales may increase worldwide starting in 2012 as emerging-market demand blunts a sluggish U.S. economy that fueled a probable decline this year, Honeywell International Inc. (HON) projected. Purchase expectations are growing in Asia, followed by the Middle East and Africa, while the free-fall in developed markets like North America following 2008’s recession has stabilized, according to an annual survey of 1,500 companies by the Morris Township, New Jersey-based avionics and cockpit-instruments maker. Companies also have cash to spend now, compensating for individuals that might hold back amid economic uncertainty, Rob Wilson, president of Honeywell’s business and general aviation unit, said in an interview. Replacement of aging planes has combined with international travel demand to boost potential sales of longer-range models, he said.

Corporate Profit Rebound Loses Steam (Source: Bloomberg)
This year’s rebound in corporate earnings is losing steam as slower economic growth and greater strain on consumers threaten sales and profit margins at companies from Texas Instruments Inc. (TXN) to Google Inc. (GOOG) Earnings per share for the Standard & Poor’s 500, excluding financial companies, rose 14 percent in the third quarter, the smallest gain since the end of 2009, analysts’ estimates compiled by Bloomberg show. That compares with 19 percent in the second quarter and 20 percent in the first. Analysts have begun reducing forecasts for the current quarter and beyond. Chipmaker Texas Instruments and air conditioner maker Ingersoll Rand Plc are among companies that have lowered their guidance because of faltering demand. With U.S. unemployment stuck above 9 percent, political squabbling about the government debt ceiling and a downgrade of the nation’s credit rating, confidence has been sapped, said Matt McCormick, who helps manage $4 billion with Bahl & Gaynor Inc. in Cincinnati.

Treasuries Decline on European Optimism, Improved U.S. Employment Outlook (Source: Bloomberg)
Treasuries fell, pushing 10-year note yields up the most since July, on optimism Europe’s leaders will adopt a coordinated approach to supporting banks and as U.S. employers added more jobs last month than forecast. Yields rose this week even as the Federal Reserve began buying longer-term debt and selling shorter maturities to keep borrowing costs low under a policy known as Operation Twist. The U.S. Treasury Department is scheduled to sell $66 billion of notes and bonds next week. “Markets have caught the idea that something is coming or something seems to be coming out of policy talks in Europe,” said David Ader, head of government bond strategy at CRT Capital Group LLC in Stamford, Connecticut. “That has taken some of the flight-to-quality rally out of Treasuries.”

Pakistan Reduces Key Rate, Beating Forecasts to Boost Expansion (Source: Bloomberg)
Pakistan’s central bank cut its benchmark interest rate by a more-than-expected 1.5 percentage points to spur investment after terrorism and floods undermined economic growth. The State Bank of Pakistan lowered the discount rate to 12 percent from 13.5 percent, Syed Wasimuddin, a central bank spokesman, said in Karachi yesterday. Three of five economists surveyed by Bloomberg News predicted a 1 percentage point cut, and the remainder forecast a 0.5 percent reduction. Acting Governor Yaseen Anwar had room to act and join emerging markets from Russia to Brazil in lowering borrowing costs after Pakistan’s inflation rate dropped 2 percentage points in the past three months. A rate cut might support an economy that’s seen growing less than half the pace of fellow South Asian nations India, Bangladesh and Sri Lanka this year.

Merkel, Sarkozy Pledge Bank Recapitalization (Source: Bloomberg)
Angela Merkel and Nicolas Sarkozy, racing to stamp out the euro debt crisis threatening to engulf the financial system, gave themselves three weeks to devise a plan to recapitalize banks, get Greece on the right track and fix Europe’s economic governance. “By the end of the month, we will have responded to the crisis issue and to the vision issue,” the French president said in Berlin yesterday at a joint briefing with the German chancellor before they dined at her office. Under increasing pressure to defuse turmoil that has raged for 18 months and facing growing concern that Greece is headed to default, Merkel said European leaders will do “everything necessary” to ensure that banks have enough capital. Sarkozy said they would deliver a plan by the Nov. 3 Group of 20 summit.

Euro Drops Versus Yen for Sixth Week as Region’s Debt Crisis Damps Demand (Source: Bloomberg)
The euro weakened against the yen for a sixth straight week, matching a string of losses ended in June 2010, after Italy and Spain saw their ratings cut even after the European Central Bank said it would aid regional banks. The 17-nation currency slid against most of its major counterparts amid increased speculation Greece may have to default, deepening the region’s debt crisis. Higher-yielding currencies, such as the Brazilian real and Mexican peso, rose as stocks advanced and after a report showed employment in the world’s biggest economy rose more than forecast. Group of 20 finance ministers meet in Paris Oct. 14-15 before a G-20 summit in Cannes in November. “The U.S. dollar has some legs to gain against the euro going into the end of the year,” said John Doyle, a strategist in Washington at currency-trading firm Tempus Consulting Inc. “It’s not a matter of if, it’s a matter of when Greece is going to default, and that’s going to weigh on the common currency.”

Euro Maintains Declines as Sarkozy, Merkel Fail to Reassure on Debt Crisis (Source: Bloomberg)
The yen fell against the majority of its most-traded counterparts as optimism Europe can contain its debt crisis spurred a climb in U.S. equity futures, damping demand for haven currencies. The euro strengthened versus most of its 16 peers after French and German leaders pledged to deliver a plan in three weeks to recapitalize banks and reiterated their intention to keep Greece in the euro. The Australian dollar gained for a fifth day against the U.S. currency before a report this week that may show employment in the South Pacific nation increased. “People are cautiously optimistic,” said Adam Carr, a senior economist in Sydney at ICAP Australia Ltd., a unit of the world’s largest interdealer broker. “The European economy is probably going to strengthen over the third quarter. The yen will probably weaken a little bit as funds maybe start to trickle out of Japan into risk assets.”

European Stocks Post Second Weekly Advance on BOE Easing, U.S. Jobs Data (Source: Bloomberg)
European stocks advanced for a second week as central banks eased lending, investors speculated that policy makers will act to support the region’s debt crisis and U.S. jobs data spurred optimism the world’s largest economy will avoid a recession. Antofagasta Plc (ANTO), Rio Tinto Group and Eni SpA led gains in commodity shares as base metals and oil climbed. Axa SA, Europe’s second-biggest insurer, rallied 11 percent after reiterating its earnings target. Dexia SA (DEXB) sank 42 percent as Belgium’s biggest bank headed toward a breakup. National Bank of Greece SA (ETE) slid the most since August.
The Stoxx Europe 600 Index advanced 2.6 percent to 231.99 this past week as the Bank of England expanded its bond-purchase program and German Chancellor Angela Merkel said she’s ready to discuss recapitalizing lenders. The gauge has still retreated 20 percent since this year’s high on Feb. 17 and is trading at 9.8 times its companies’ estimated earnings, near the cheapest since March 2009, according to data compiled by Bloomberg.

U.K. Stocks Advance on U.S. Jobs Report; Rio Tinto Advances (Source: Bloomberg)
U.K. stocks gained for a third day after a report showed employers in the U.S. added more jobs than forecast last month, easing concern amid investors that the economic recovery is faltering. Commodities companies, whose profits are closely tied to growth, led the advance, with Rio Tinto Group rising 1.2 percent. Royal Bank of Scotland Group Plc (RBS) and Lloyds Banking Group Plc (LLOY) retreated more than 3 percent as Moody’s Investors Service cut the ratings on their debt. Premier Foods Plc (PFD) plunged 42 percent after saying third-quarter results were “significantly” below forecasts. The FTSE 100 Index (UKX) gained 12.14, or 0.2 percent, to 5,303.4 at the 4:30 p.m. close in London. The gauge has rallied 3.4 percent this week as investors speculated policy makers will reach agreement to shield financial institutions from the European debt crisis and as the Bank of England expanded its bond-purchase program. The FTSE All-Share Index added 0.3 percent today, while Ireland’s ISEQ Index rallied 0.5 percent.

BoE’s Weale Says the Bank Has a ‘Lot of Scope’ to Increase Asset Purchases (Source: Bloomberg)
Bank of England policy maker Martin Weale said the central bank has “a lot of scope” to increase asset purchases if it’s deemed necessary to boost economic growth. “There is quite a lot of scope for further quantitative easing,” Weale said in an interview on Sky News yesterday. The U.K. central bank last week raised the ceiling for its asset purchases, or so-called quantitative easing, to 275 billion pounds ($428 billion) from 200 billion pounds. Governor Mervyn King said the move, the first loosening of U.K. monetary policy since the depths of the recession in 2009, was a response to what may be the worst financial crisis ever. Asked if he agreed with King’s description, Weale said there are similarities to the 1930s and the economic situation is “very difficult.” He cautioned that central banks can’t resolve all the world’s economic woes.

Stevens Rate Cut Seen Smallest in Two Months on Europe: Australia Credit (Source: Bloomberg)
European efforts to avert a banking crisis are reducing expectations for lower interest rates in Australia, bond market measures show. Reserve Bank of Australia Governor Glenn Stevens suggested less than a week ago that he’s willing to lower the developed world’s highest benchmark rate of 4.75 percent as Greece’s struggle to avoid default damps investor confidence and growth. As markets rallied last week after the European Central Bank said it will give banks access to unlimited cash, bond investors pared bets the RBA will repeat the series of cuts that followed Lehman Brothers Holdings Inc.’s collapse in 2008. “The market has now got it into its head that there’s going to be some sort of solution,” Matthew Johnson, a strategist at UBS AG in Sydney, said in a telephone interview on Oct. 7. “There are some serious headwinds playing out there, so I don’t really see the market moving away from pricing in rate cuts because the RBA is now talking about it as well.”

Australian Lawmakers Will Vote on Carbon Tax Proposal This Week, Swan Says (Source: Bloomberg)
Australia’s parliament will vote this week to put into law the nation’s first tax on greenhouse gas emissions aimed at cutting reliance on fossil fuels and boosting renewable energy. “Putting a price on carbon will break the link between emissions growth and economic growth, driving innovation to find better, less polluting ways of producing power, goods and services,” Treasurer Wayne Swan said in a statement yesterday. The developed world’s biggest per capita polluter will raise A$27.8 billion ($27.2 billion) in three years by making companies pay for carbon emissions, Prime Minister Julia Gillard said in July when unveiling details of the policy.

20111010 1153 Global Commodities Related News.

Commodity indexes in rebalancing act as Brent rises
NEW YORK, Oct 6 (Reuters) - Every year around this time, the world's commodity index managers go through the annual rite of rebalancing their mix, shifting ratios that can swing billions of dollars from one market to another come January.
It is an important, but rarely dramatic, process. These mammoth products, which now boast more than $300 billion in tracking funds after growing from nearly nil a decade ago, follow fairly clear formulas for deciding whether to add or subtract oil, wheat or copper from their plan.

COMMODITIES-Strong weekly gains as copper, oil surge
NEW YORK, Oct 7 (Reuters) - Commodities fell on Friday but ended with the biggest weekly gains in three months in volatile trading, as Europe's debt problems continued to weigh on a sector recovering from a dismal third quarter.  A downgrade for the credit ratings of Spain and Italy served as the latest twist in the euro zone debt saga, offsetting the positive impact of a better-than-expected U.S. jobs report for September
"Each downgrade is a more visible acknowledgment of the problems"

Corn (Source: CME)
US corn futures end lower, retreating on seasonal harvest selling ahead of an active harvest weekend. Traders were cautious not to push prices higher, bracing for an influx of freshly harvested US corn to enter the supply chain. Industry analysts expect harvest to accelerate amid warm, dry Midwest weather. Harvest was the dominant feature for traders to focus on ahead of next week's government crop report, analysts say. Corn remained vulnerable to external financial market influences, with a better than expected US jobs report helping limit declines. CBOT Dec corn ended down 5 1/2c at $6.00/bushel.

Wheat (Source: CME)
US wheat futures close mixed, with prices in Chicago and Kansas City declining while Minneapolis spring wheat continuing to surge on tight near-term supplies. MGEX, particularly the spot month, has surged due a small crop and farmers' refusal to sell at prices they feel are bound to rise, analysts say. But CBOT and KCBT fell on expected export competition from the Ukraine and ample rains expected in the southern Plains, which are badly needed for the hard red-winter-wheat crop. December CBOT ends down 1.4% at $6.07 1/2 while KCBT December falls 1.9% to $6.84 1/2. MGEX December jumped 2.7% to $9.19 1/2 while deferred contracts showed modest gains.

Rice (Source: CME)
US rice futures stumble to a three-month low amid harvest pressure and weak demand. The ongoing harvest is putting seasonal pressure on the market, which lacks any fresh fundamental news to counteract that. Outside markets also weigh, as other grains, including corn and wheat, also end lower. Weather damage to crops in Asia could give support to the market, analysts say. CBOT Nov. rice ends down 30 1/2c, or 1.9% to $15.62 1/2 per hundredweight.

China kick-starts soybean market recovery: Gavin Maguire

--Gavin Maguire is a Reuters market analyst. The views expressed are his own. To get his real-time views on the market, please join the Global Ags Forum. --
The recent heavy slump in soybean prices has reignited buy-side interest in the commodity and looks set to pave the way for a sustained recovery in the soy market.
China's 354,100-metric-ton purchase of U.S. soybeans announced on Thursday follows that country's purchase of 845,000 tons
the week prior, and has helped turn trader focus to the demand side of the market equation following weeks of supply and
macro-related attention. And with the cost of U.S. soybeans still hovering at close to its lowest levels in a year,
additional acquisitions from overseas buyers look likely in the near future.

Soy falls on yield outlook, harvest pressure; wheat firms
SINGAPORE, Oct 7 (Reuters) - Chicago soy slid half a percent, trading close to a one-year low as the market was weighed down by a forecast of higher U.S. crop yields and ideal weather aiding the harvest in the Midwest.
"There is pressure on corn and soybean prices as the harvest is progressing well with dry weather in the Midwest," said Lynette Tan, a grains analyst at Phillip Futures in Singapore.

Kazakh grain exports seen 1 mln T/month from Nov
AKKOL, Kazakhstan, Oct 7 (Reuters) - Kazakhstan, expecting a record grain crop this year, plans to raise monthly exports to 1 million tonnes from November and is trying to secure extra rail wagons to boost shipments, Agriculture Minister Asylzhan Mamytbekov said on Friday.
"In October, we plan to reach an export level of 650,000 tonnes. From the following month, we plan to export 1 million tonnes every month," Mamytbekov said during a visit to a grain elevator 100 km (63 miles) north of the capital Astana.

Argentina's key wheat area helped by rain –exchange
BUENOS AIRES, Oct 6 (Reuters) - Rains over the last week in key Argentine wheat areas improved conditions of 2011/12 crop after a dry September had raised concerns about it, the Buenos Aires Grains Exchange said on Thursday.
Lack of precipitation last month delayed corn planting and battered wheat crops in Argentina. The South American grains powerhouse is a leading wheat exporter and the world's No. 2 corn supplier.

US drought expands in Texas but rain seen soon
Oct 6 (Reuters) - A devastating drought expanded in Texas over the last week as rain showers dotting the U.S. Plains mostly missed the thirsty Southern state, according to a national drought report issued Thursday.
Moderate to locally heavy rains fell on northeastern Oklahoma and southern Missouri, but appeared insufficient to substantially change the drought there.

Coceral ups EU 2011 wheat, maize crop forecasts
PARIS, Oct 6 (Reuters) - European Union grain trade lobby Coceral raised its forecast for the bloc's soft wheat harvest in 2011 to 128.39 million tonnes from the 126.53 million tonnes estimated in July.
The forecast was in line with recent estimates by French analysts Strategie Grains, which last month put the bloc's total soft wheat output at 129.0 million tonnes.

UK 2011 wheat harvest up 3 pct on year -farm ministry
LONDON, Oct 6 (Reuters) - The U.K.'s 2011 wheat harvest is estimated at 15.4 million tonnes, up 3 percent on the year, the farm ministry reported on Thursday.
"This increase is a combination of a slightly increased yield of 7.8 tonnes a hectare, along with a 1 percent increase in the wheat area," the ministry said.

End To Ukraine Wheat, Corn Duties Boosts Export Hopes (Source: CME)
Ukraine's parliament voted to end duties on grain exports as of next year, in a move industry sources say will boost shipments from this year's expected bumper harvest. The new bill plans to abolish duties on wheat and corn put in place last year, while keeping the barley export duty at 14% but not less than EUR23 per metric ton, according to the parliamentary press service. The bill now needs to be signed by president Victor Yanukovich but is expected to come into force on July 1, 2012--a year after the current taxes were put in place. Industry groups welcomed the move to reduce the duties, which they blame for Ukraine's modest grain exports so far this year. Ukraine's agriculture ministry forecasts grain production could reach 50 million to 53 million tons in 2011, up from the less than 40 million tons harvested from last year's drought-hit crop.
"The tariffs had a very negative influence on the market as a result of which traders suffered very large losses," Leonid Kozachenko, president of the Ukrainian Agrarian Confederation, told Dow Jones Newswires. "And the state also didn't receive the desired revenues into the budget." He estimates that Ukraine has the potential to export 23 million to 24 million tons of grain in the 2011-12 marketing year. In the first three months, traders have exported a little over 3 million tons in the first three months of the current marketing year, compared to around 3.5 million tons last season. The move also comes at a time when higher grain prices in Russia--a key supplier to the world market since the Kremlin lifted a ban on shipments this year--have made Ukrainian grain more attractive.
This week, the state grain buyer for Egypt, the world's largest wheat importer, signalled it intends to add Ukraine to its approved suppliers for the first time since 2008; Ukrainian wheat was also offered as the cheapest origin in its latest tender. "Russian wheat is still the cheapest offer into Egypt, but the fact that Ukrainian wheat was offered cheaper (but not accepted) may point the way to the future, especially if current export duties are relaxed," said U.K.-based merchant, Gleadell. Still, local traders in Ukraine said they don't expect a sudden flood of exports any time soon. Poor weather earlier in the season could also limit demand as much of the wheat harvest will be of feed wheat, Gleadell added. Ukraine's government imposed export duties on grain July 1 as a result of last year's drought. Wheat export duty was 9% of the contract price but not less than EUR17 per metric ton. The corn export duty was EUR12 but not less than EUR20 per ton.

Up To 8% Of Thai Rice Crop Hit By Flooding But Price Impact Seen Limited (Source: CME)
At least two million metric tons of unmilled rice or about 8% of Thailand's main harvest has been hit by severe flooding in the northern and central parts of the country, potentially lowering output this year, trading executives and industry officials said. However, this is unlikely to have an immediate impact on global prices as Thai rice is already priced out of the market following a controversial decision by the new government earlier this year to buy rice from farmers at sharply higher prices, making exports un-viable. Rice prices in Thailand and Vietnam, two of the biggest exporters of the grain, have already been around three-year highs for more than a month, prompting most buyers to turn to cheaper sources such as India, Pakistan and Myanmar. Rice from India and Pakistan is offered at least $100/ton below Thail and Vietnamese prices. Moreover, it is too early to estimate the real damage to the crop as that would depend on how long the flooding continues.
Unless flood waters stay at current levels for long, which seems unlikely, any further increase in rice prices will be short-term and limited, said Santitarn Sathirathai, an economist with Credit Suisse. "Most of the damage is in the central Thailand and production may fall this year but we are hopeful of making up with the secondary harvest in April because the water has actually benefited the crop in the north-eastern highlands," said Chookiat Ophaswongse, former president of Thai Rice Exporters Association. While Thai government estimates show more than 1.3 million hectares or 13% of the total rice acreage affected by flooding, Chookiat said serious damage may occur only in half that area. He said the harvest will gather momentum only in December-January and waters may recede by then.
Some traders said there could still be further upside potential in prices, although that would be more a result of a new government procurement program that got underway. Under the program, the new government is buying rice from farmers at prices that are some 50% higher than last year. The other wild cards are supply fro Vietnam and demand in the Philippines. The Philippines had cut back imports last year but Typhoon Nesat has damaged part of the local crop this year, potentially raising the need for higher imports. Rainfall has also been high in Vietnam's Mekong Delta which accounts for most of the rice is exported from the country, although only a small third crop is currently being harvested in the region. Still, such developments will only have limited impact on prices as there are plentiful stocks elsewhere, said Concepcion Calpe, a senior economist with United Nations' Food and Agriculture Organization.

Rain Brings More Relief To Argentina's Parched Wheat Crop - Exchange (Source: CME)
Argentina's developing wheat crop got some relief from dry conditions thanks to mild showers during the last week, the Buenos Aires Cereals Exchange said in its weekly crop report. "Though the demand for water is still greater than the rainfall that is available, the showers gave some breathing room following a prolonged period without rain," the exchange said. The exchange forecast abundant rainfall over a large portion of the country's farming belt during the next seven days. The Agriculture Ministry is expecting 2011-12 wheat production to total 11 million to 13 million metric tons, compared with the 15 million metric tons the U.S. Department of Agriculture pegged the 2010-11 crop at.

Japan Seeks New Rice Source (Source: CME)
Japanese consumers typically prefer fresh, home-grown rice, but that isn't true this year. Demand has surged for remaining supplies of last year's harvest of the country's staple crop, as well as for foreign-grown grains. Shoppers worry that the latest domestic harvest may be contaminated with radiation from the Fukushima Daiichi nuclear accident. In Hyogo prefecture in western Japan, rice-store owner Toshikazu Nishira said online orders for U.S.-grown organic rice have jumped, despite steep tariffs on rice imports designed to protect the domestic market. In August, the orders, mostly from eastern Japan, were nearly 20 times more than normal, as people who couldn't find domestic rice from last year ordered imported rice, Mr. Nishira said. "For the first time, Japanese people seem to be worried about domestic rice," said Mr. Nishira, who has been running the business for almost 30 years. "I have no idea how long this will last, and how it might turn out."
Fukushima prefecture, showered with radiation in March, is the fourth-largest rice-producing region in Japan. It is also a big supplier for Tokyo, where government tests for rice contamination are expected to be largely finished next week. So far, one tested batch has turned up contamination near levels triggering a sales ban. But consumer advocates and others criticize the government's testing method. Mariko Sano, secretary-general of Tokyo-based consumer group Shufuren, said the amount of contamination allowed is too high, because it is the same level for rice -- which Japanese consume in quantities seven times greater than Americans -- as it is for beef and other types of food eaten in smaller quantities. "The government seems to only tighten its rules after problems have occurred, and that is creating mistrust among consumers," she said. Japan has gone through other food-safety scares since the nuclear accident, particularly the discovery this summer that contaminated beef had escaped testing.
But the safety of rice is particularly important in Japan, a country where people pay as much as $1,000 for rice cookers flecked with silver, gold or diamond dust that promise to steam up the perfect bowl.

Thailand Bolsters Flood Defenses (Source: Bloomberg)
Thai Prime Minister Yingluck Shinawatra ordered authorities in Bangkok to bolster flood defenses as the nation’s worst deluge in more than 50 years threatens to inundate the capital over the next few days. At least 269 people have been killed as a result of the seasonal monsoon rains that have hit the country since July 25, the Department of Disaster Prevention and Mitigation said on its website today. About 30 of Thailand’s 77 provinces remain underwater, the agency said. Floodwaters that shut down factories operated by Honda Motor Co., Nikon Corp. and Canon Inc. over the weekend will reach Bangkok later this week, said Yingluck, who conceded that her two-month-old administration is struggling to respond to the crisis. The city of more than 6 million people is less than 2 meters above sea level, making its susceptible to flooding.

Sugar, coffee rise aftercommodities advance
LONDON, Oct 7 (Reuters) - ICE sugar, coffee and cocoa futures advanced in early trade, after gains in other commodities due to steps by the European Central Bank to aid struggling banks helped to temper concerns about the euro zone debt crisis.
Arabica coffee futures were higher in early trade as the market extended its recent rebound, boosted by a more positive tone to other financial markets.

Indonesian cocoa output seen at 450,000 T in 2011
JAKARTA, Oct 7 (Reuters) - Cocoa output in Indonesia, the world's third-largest producer, is seen down about 25 percent this year due to wet weather and disease and will improve in 2012 to a level below initial estimates, the Indonesian Cocoa Association (Askindo) said on Friday.
Indonesia has been grappling with pests and diseases for years. Heavy rains in the main growing island of Sulawesi have again triggered the spread of Vascular-streak Dieback (VSD), a disease that attacks branches, leaves and trunk, eventually killing the trees.

I.Coast cocoa arrivals 1,460,191 T by Sept 25-data
ABIDJAN Oct 6 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast reached 1,460,191 tonnes by September 25, up from 1,184,195 tonnes in the same period a year ago, according to data from the Bourse du Cafe et Cacao (BCC) obtained by Reuters on Thursday.
The figures showed 8,427 tonnes of beans declared at the ports of Abidjan and San Pedro from Sept 19 to September 25, down from 24,025 tonnes in the same week of the 2009/2010 season. A further 2,473 tonnes were declared late by some exporters.

Armajaro sees Brazil sugar output recovery in 2012/13
LONDON, Oct 6 (Reuters) - Trade house Armajaro Trading Limited, in a preliminary forecast, sees a small year-on-year recovery in centre-south Brazilian cane output to 500 million tonnes and sugar production to 32 million tonnes in 2012/13.
The forecast is subject to no government intervention over production of ethanol from cane, Guy Toller, a director of Armajaro Trading and head of global sugar operations, told Reuters in an interview late on Wednesday.

Oil edges up in choppy trade, posts weekly gain  
NEW YORK, Oct 7 (Reuters) - Oil prices edged higher in volatile trading on Friday and posted a weekly gain as supportive U.S. jobs data and a ratings downgrades of Spain and Italy buffeted markets.
"Some late price recovery came after the shock that Spain was included in the downgrades wore off,"

Natural gas ends down 3 pct on weather, supplies
NEW YORK, Oct 7 (Reuters) - U.S. natural gas futures ended down sharply on Friday as forecasts for extended mild weather plus growing supplies drove the front-month contract to another 11-month spot chart low.
"People are impressed with the big storage numbers - it looks like storage is making a beeline back to last year's record levels - and the short-term weather looks pretty bearish,"

Crude Oil Gains a Fourth Day on U.S. Jobs Growth, European Crisis Pledge (Source: Bloomberg)
Oil climbed for a fourth day in New York as investors bet that fuel demand may increase on signs of an economic recovery in the U.S. and a pledge by Europe to contain its sovereign-debt crisis. Futures gained as much as 0.5 percent, after the biggest weekly gain in seven months. U.S. employers added more workers in September than forecast, a report showed Oct. 7. German Chancellor Angela Merkel said yesterday that European leaders will do “everything necessary” to ensure that banks have adequate capital. OPEC members are likely to keep their output target for oil unchanged when they meet in December, according to Iran’s representative. “Better-than-expected U.S. data boosted the outlook for the broader economy and oil demand,” James McIntyre, an economist at Commonwealth Bank of Australia, said in a note.

Malaysia says 2012 crude oil output may rise 3.3 pct
KUALA LUMPUR, Oct 7 (Reuters) - Malaysia's crude oil production is seen rising 3.3 percent in 2012, reversing a decline this year, and liquefied natural gas production may increase, the Ministry of Finance said on Friday.
Crude output is forecast to increase to 620,000 barrels a day after an estimated 6 percent drop in 2011.

Iraq's Rumaila South output back at 460,000 bpd - oil official
BASRA, Iraq, Oct 9 (Reuters) - Iraq's Rumaila South oilfield output has been restored to 460,000 barrels per day after pipeline bombings last week and normal production of about 650,000 bpd is expected to start on Monday, the head of Rumaila operations told Reuters on Sunday.

China's refined oil product stocks up in early Oct
BEIJING, Oct 9 (Reuters) - Refined oil product stocks in China, the world's second largest oil consumer, stood at 11.62 million tonnes as of Friday, edging up slightly from the end of September despite rising fuel sales, the top economic planner said on Sunday.
The oil product inventory saw a big increase from a year earlier, the National Development and Reform Commission said on its website (, but did not give a percentage change.

Euro Coal-Prices stable on scant trade by few buyers
LONDON, Oct 6 (Reuters) - Prompt physical coal prices were little changed on Thursday, after a steep fall of $2 a tonne early in the week, while buyers were thin on the ground.
Coal has largely been immune to the volatility seen in other markets, although prices have slowly drifted lower by around $10-$15 a tonne since June.  

U.S. coal co shares rally after recent battering
NEW YORK, Oct 5 (Reuters) - Shares in U.S. coal companies, which had been hammered in recent sessions, rallied on Wednesday, with Alpha Natural Resources  rising 8.7 percent.
The Dow Jones coal index, which hit a year-low on Tuesday, rose 5 percent as analysts said investors were moving back into the sector after sell-offs for the past two weeks on concerns over the global economy.

Asia Coal-Australia thermal coal prices lower, China on holiday
Oct 5 (Reuters) - Australia's thermal coal price index fell slightly during the past week, with holidays in China slowing buying from the world's biggest coal consumer and Japan, Australia's biggest customer, still on the sidelines after settling a long-term contract last month.  
Thermal coal on the global COAL Newcastle index for the week to date closed at $121.51 per tonne on Tuesday, down from $122.20 per tonne a week earlier.

S.Korean utilities seeking more high calorific coal-sources
SEOUL, Oct 5 (Reuters) - South Korean utilities are seeking more high calorific coal than they usually consume in a year as they prepare for winter demand and hedge against any shortage due to possible floods in Australia, industry sources said on Wednesday.  The government of South Korea, the world's third-largest thermal coal buyer after Japan and China, said last Friday that it will instruct domestic utilities to secure the coal to prevent blackouts similar to the ones that hit earlier this month during the winter.

Iron Ore-Swaps fall, spot seen down when China returns
SINGAPORE, Oct 7 (Reuters) - Iron ore forward swaps mostly fell as investors bet on declining spot rates when top buyer China returns next week after a week-long break, though the focus is on how steel prices in Shanghai will perform after suffering their worst month in September.
The recent selloff in risky assets as well as signs of slower steel demand in China, the world's biggest consumer and producer, dragged Shanghai rebar futures  down more than 11 percent in September, their biggest monthly loss ever.

Copper Traders the Most Bullish Since August After Biggest Rout Since ’08 (Source: Bloomberg)
Copper traders and analysts are the most bullish since August on speculation prices at a one-year low will spur China, the world’s largest buyer, to build stockpiles. Gold, sugar, corn and soybeans may also climb. Ten of 15 respondents surveyed by Bloomberg expect copper to rise next week and 5 predicted a drop, the most bullish reading in six weeks. It’s the first time in four weeks that the separate surveys forecast gains for all five commodities. Copper slumped to a 14-month low on Oct. 3 as commodities slid on concern that demand may wane as economies slow. Diego Hernandez, chief executive officer of Codelco, the world’s largest copper producer, said the next day that China should take advantage of the slump to restock. In 2008, during the worst global recession since World War II, China’s copper demand still jumped 4.9 percent, according to Morgan Stanley.

Baltic index up for 2nd day, more gains eyed
LONDON, Oct 6 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose for a second day on Thursday with expectations for firmer cargo activity in the coming days.
Brokers said growing vessel supply, which was outpacing commodity demand, was set to cap dry bulk freight rate gains in the coming months with economic uncertainty adding to headwinds.

Shipping faces financing squeeze
LONDON, Oct 6 (Reuters) - The shipping industry will face tougher financing conditions in the next 24 months as banks tighten credit lines with more asset sales and ship seizures expected as a rout in seaborne earnings also takes its toll, a senior banker said on Thursday.
Many European banks are restructuring and are under pressure to shrink their balance sheets in response to tougher regulations requiring them to hold more capital against their loans. Shipping companies especially in the crude oil tanker and dry bulk sectors, hit by weak earnings and an oversupply of vessels, have already found it hard to find financing.

20111010 1151 Soy Oil & Palm Oil Related News.

ITS CPO export up 31.8% to 496,918 tonnes for the period of 1~10 Oct 2011.
SGS CPO export up 25.1% to 486,882 tonnes for the period of 1~10 Oct 2011.

MPOB Official Data for the month of Sep 2011 vs Aug 2011
Exports down 8.8% to 1,543,425 tonnes
Stocks up 12.4% to 2,119,985 tonnes
Output up 12.1% to 1,869,369 tonnes
Imports up 9.4% to 69,857 tonnes

Soybeans (Source: CME)
US soybean futures end lower, succumbing to harvest released selling pressure. Traders bracing for an aggressive harvest weekend pace, were cautious not to push prices higher, analysts say. Industry analysts were also gearing up for a potential increased in production estimates when government forecasters release their latest crop production outlooks next week, analysts add. Otherwise, traders were unwilling to aggressive move prices amid lingering uncertainty about the global economy. CBOT Nov soybeans ended down 5 1/2c at $11.58 1/4/bushel.

Soybean Meal/Oil (Source: CME)
Soy product futures end mixed, with prices trading in both positive and negative territory. Traders say prices were consolidating ahead of the weekend and next week's crop report. CBOT Dec soymeal ended up $0.20 higher at $304.30/short ton, and Dec soyoil was up 0.18c at 49.32 cents/pound.

Palm oil falls, set for worst weekly performance since June
KUALA LUMPUR, Oct 7 (Reuters) - Malaysian palm oil fell and is on course for its worst weekly showing since June as short-sellers continued to offload more holdings than bargain hunters could scoop up.
"There is a bit of a war going on," said a trader with a foreign commodities brokerage.

India's Sept oilmeal exports up 11.5 pct y/y-trade
NEW DELHI, Oct 7 (Reuters) - India's oilmeal exports rose 11.5 percent in September, its eleventh straight monthly rise, helped by a jump in oilseeds output and improved demand from Southeast Asia, a leading trade body said on Friday.
Oilmeal exports from India, Asia's leading supplier, were  394,877 tonnes in September compared with 354,252 tonnes a year earlier.

Linn Group raises US soy yield forecast by 2.9 pct
CHICAGO, Oct 6 (Reuters) - The Linn Group, a Chicago-based commodity research and brokerage firm, on Thursday raised its
estimate of the 2011 U.S. soybean yield to 42.2 bushels per acre (bpa), up 2.9 percent from 41.0 bpa in late August.
The firm raised its soybean production estimate to 3.086 billion bushels from its prior estimate of 2.997 billion.

Yields to bring down Brazil's new soy crop-gov't
BRASILIA, Oct 6 (Reuters) - Brazil may suffer its biggest drop in soy output in decades next year if dry conditions from a possible return of La Nina weather descend on the southern grain belt, the government said on Thursday.
In its first forecast of 2011/12, the government's crop supply agency Conab said soy output will fall to 72.18-73.29 million tonnes from a record 75.3 million last year.

UK rapeseed exports to rise following record crop
LONDON, Oct 6 (Reuters) - UK exports of rapeseed could rise to more than 500,000 tonnes in 2011/12, boosted by a record crop and diminished competition from Germany, David Eudall, senior analyst at Britain's Home-Grown Cereals Authority said on Thursday.
"There is a very large export market for the UK," he told the HGCA's annual outlook conference, adding UK exports could be "500,000 tonnes or above".

Malaysia to talk to Indonesia about palm oil export tax cuts-report
KUALA LUMPUR, Oct 6 (Reuters) - Malaysia, the world's second biggest palm oil producer, wants to hold talks with top producer Indonesia over its decision to slash exports for processed vegetable oils, Commodities Minister Bernard Dompok was quoted on Thursday as saying.
Dompok was quoted by state news agency Bernama as saying the government was studying the impact of the Indonesian tax cut, which Malaysian refiners says puts them at a price disadvantage

Malaysia's Sept. palm oil stocks seen climbing again
KUALA LUMPUR, Oct 6 (Reuters) - Malaysian palm oil stocks likely rebounded in September from the previous month as production outpaced moderating export demand after a major Muslim festival, a Reuters survey of five plantation houses showed on Thursday.
Stocks in the world's second biggest producer likely rose 3.5 percent to 1.95 million tonnes, snapping two months of declines and further weighing on benchmark palm oil futures.